Why IBM spent billions buying a tech they already had access to

IBM reportedly paid about $2 billion for Weather Company's digital assets even though the two tech companies had already formed a partnership that gave IBM access to the company's weather data.

After securing the initial partnership IBM's Inhi Suh, VP and GM of Big Data, Integration, & Governance, realized that the Weather Company was working on some mind-blowing technology, she told Business Insider.

She realized that marrying that tech with IBM's own super smart computer Watson, which can analyze and predict things, would be a very powerful combination.

"I got to see, along with a few members of IBM, some of the technical capabilities the Weather Company was developing," Suh told Business Insider.

The team at IBM quickly realized the Weather Company was solving a very hard technical problem.

"If you think about how Google has mapped the earth with Google Earth, the Weather Company was beginning to map the entire atmosphere," Suh explains.

"Think about how hard it is to map the weather and the climate. It's moving all the time. It's one thing to map static things such as an object or a continent. It's completely different when trying to ingest data about the moving climate, the wind, humidity, barometric pressure," Suh says.

Suh is excited about the program's growing ability to capture data in the Karman line, the 62-mile boundary between Earth's atmosphere and outer space.

"[The Karman line is] Significantly shorter than the distance between Boston and NY. In that 62 mile distance, all the things happen [in weather] that impacts everything from agriculture, flights, and traffic. Now we have a platform, that lets me see and make sense of it all," Suh says.

The ability to accurately track weather minutiae could have huge implications for business operators. Suh says weather events have a half a trillion dollar impact on businesses every day.

"A couple of clients talked to IBM about weather data. If you think of the insurance industry as one example, one client told us that a single hail storm in the middle of Phoenix one year, and a hail storm that lasted only a few hours, caused more than $20 million in damages," Suh says.

The Weather Company purchase goes beyond weather.

The team at IBM envisions a platform that is innovative "not only for business-to-business, but for every day society, with the potential of solving a whole set of problems," Suh explains.

That excitement was echoed by IBM CFO Martin Schroeter, who recently took part in a fireside chat at the MIT Sloan Summit where he talked about the acquisition's benefits outside of the weather sector.

"The [Weather Company] has built a platform that pulls in 4GB of data per second. So it has this massive ingestion machine and it runs a lot of analytics. All of that data sits on a cloud and when you click on a forecast for your location it immediately gives you that data. All of that activity generates about 30 billion interactions a day," Schroeter says.

"So this is a platform that has an incredible amount of scale that's good for weather and really good for a lot of other things. The way this system was designed you have to think of end-points - right now the end-points are weather-based. But the end-point could be a smartwatch or it could be your refrigerator," he adds.

Schroeter sees a future where IBM's analytics capabilities are paired with the Weather Company's data ingestion technology to create the world's leading internet of things.

"We talked with our clients about how this technology will change their industries and change their businesses. When you match Weather Company's technical capabilities with Watson and its ability to understand a massive amount of data, and its ability to find insights, this becomes a very powerful platform," he says.