IBM (NYSE:IBM) Signs Deal for Data Analytics with Twitter (NYSE:TWTR): Why?

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By Hanson So on November 3, 2014 Social Media, Us News

IBM (NYSE:IBM), a manufacturer of computers, struck a deal last week with social networking website, Twitter (NYSE:TWTR), regarding data analytics. The move, initiated by IBM (NYSE:IBM), allows the computer manufacturing company to incorporate the data, which Twitter (NYSE:TWTR) has, within its products, to meet consumer needs in a more precise manner.

In what is being termed as one of the most unlikely alliances in the technology world this year, Twitter (NYSE:TWTR) has shaken hands with IBM (NYSE:IBM) to supply the latter with data in order to run its business analytics division. According to IBM (NYSE:IBM)’s General Manager for business analytics, the move to bring in more data into the program is superb for the data analytics division of the company, because “when it’s an incredibly unique dataset like Twitter (NYSE:TWTR), the analytics become better and the decisions become clearer.”

Twitter (NYSE:TWTR) is a social networking website unlike any other in the world; it is highly basic. There is nothing innately complicated about Twitter (NYSE:TWTR), as it serves a very basic function: connecting people with other people, celebrities, and even companies like Microsoft, Google, IBM (NYSE:IBM) etc. The maximum allowed characters in a “tweet” are 140, hence each and every tweet is short, precise, and concrete.

This limiting factor makes Twitter (NYSE:TWTR) an excellent source of data for analytical purposes, as it is easier to analyze millions of users’ data, as all of it is in a single format. Also, this forces users to structure their tweets in a manner which delivers as much information within 140 characters as possible. According to Chris Moody, VP data strategy at Twitter (NYSE:TWTR), “there’s lots of information in the payload of a tweet, much more than 140 characters.”

Talking to Fortune magazine, Rennie explained that the data which will pour in from Twitter (NYSE:TWTR) will be utilized in steps: Firstly, all the data which will be provided will be uploaded on cloud tools for analytics, which will make it easier for customers to access it; Secondly, Rennie specified that specific needs of business will be targeted, and business solutions will be made in light of user data. Finally, he declared that over 10,000 consultants from all over the world will be trained and certified as experts of Twitter (NYSE:TWTR), by IBM (NYSE:IBM).

But what exactly is IBM (NYSE:IBM) going to accomplish with Twitter (NYSE:TWTR)’s data set? According to Rennie, the data will prove useful for many divisions including R&D, marketing, human resources, and logistics, as the company will be able to base its decisions on the analysis of the input of millions of consumers worldwide. Talking to Fortune magazine, Rennie said, “From an IBM perspective, we think having this data is a big differentiator in terms of our ability to attract clients.”

In all this, analysts wondered what Twitter (NYSE:TWTR) is receiving at the other end of the bargain. For Twitter (NYSE:TWTR), the biggest incentive is that its data set would be put together with other data sources in a manner which would make it a fruitful analytical tool for businesses worldwide. According to Moody, “[Twitter’s] data is useful[; it] need[s]someone to come along and build value on top of it and combine it with other data sources.”