IBM and WPP sign £800m cloud agreement

<p>WPP is to merge the operations of more than 300 agencies.</p>

US technology company IBM has agreed a $1.25 billion (£796 million) cloud-computing deal with WPP, the world’s largest advertising agency. The seven-year agreement will allow WPP to merge the operations of more than 300 agencies it has bought up over the past ten year.

IBM will use hybrid clouds – which mix private and on-site computer systems – with newer public-facing internet and mobile systems. It will run WPP operations within global hybrid cloud infrastructure

"As the world’s largest communications group, we are seeking to exploit IBM’s cloud computing expertise to allow us to innovate and add value to both the service and the product we deliver to clients across 111 countries," said Robin Dargue, WPP’s chief information officer.

IBM has recently signed a string of similar agreements with European firms. On Monday, IBM disclosed a multibillion-dollar deal to provide computer infrastructure services to Dutch bank ABN Amro.

Last month, Lufthansa agreed a $1.25 billion contract for IBM to take over the German airline's information technology operations and staff.

And the new contract signings are not over yet, an executive for the computer services giant told Reuters.

Bart Van den Daele, IBM's general manager for strategic outsourcing in Europe, said big contract signings slowed in the depths of the euro crisis but that the region's customers are ready to play catch-up.

"(There's) a new wave of these deals which is still continuing and we see it going forward," Van den Daele told Reuters, referring to cloud contracts. He did not specify, however, whether these deals would be similar in scale to the recent billion-dollar plus awards. "Now you see the first results with Lufthansa, ABN Amro and WPP and there will be others," he added.

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