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January 9, 2014

IBM to spend $1bn on Watson business unit

The new unit will develop new consumer and enterprise applications.

By CBR Staff Writer

IBM has announced plans to spend about $1bn (€606m) to create a new business unit for its Watson supercomputer as it looks at new ways to create growth.

The company is looking to generate more revenue from the unit by supplying a new cloud-based technology that can be used to develop new consumer and enterprise applications.

Michael Rhodin, the former IBM software solutions group SVP, will be heading the new IBM Watson Group unit, which will be set up in New York.

Watson Business VP Stephen Gold said: "We have reached the inflection point where the interest is overwhelming and we recognised we need to move faster."

About $100m of the total investment will be used to develop new products at the Watson Developers Cloud, which has been opened to external application developers since last year.

Watson supercomputer was designed to answer questions asked in natural language and it came popular after it beat human contestants on the US television quiz show Jeopardy in 2011.

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