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With Red Hat, IBM Just Won a Billion Dollar AT&T Deal

Just days into Red Hat’s tenure as an IBM company, and the $34 billion marriage is already paying off for Big Blue.

Tuesday, IBM announced a “multi-year strategic alliance” with wireless giant AT&T communications centered on cloud computing.

Via a spokesman, IBM declined to give financial details, but the transaction was described by CNBC as a “multibillion” dollar deal.

In a press release, IBM notes that, as part of the deal, AT&T Business “will utilized Red Hat’s open source platform to manage workloads and applications.”

That’s as AT&T uses IBM’s expertise and infrastructure to modernize its own software and business applications.

Executives at both AT&T and IBM released statements about the deal in a press release:

“In AT&T Business, we’re constantly evolving to better serve business customers around the globe by securely connecting them to the digital capabilities they need,” stated Thaddeus Arroyo, CEO of AT&T Business. “This includes optimizing our core operations and modernizing our internal business applications to accelerate innovation. Through our collaboration with IBM, we’re adopting open, flexible, cloud technologies, that will ultimately help accelerate our business leadership.”

“Building on IBM’s 20-year relationship with AT&T, today’s agreement is another major step forward in delivering flexibility to AT&T Business so it can provide IBM and its customers with innovative services at a faster pace than ever before,” stated Arvind Krishna, Senior Vice President, Cloud and Cognitive Software, IBM, in the release. “We are proud to collaborate with AT&T Business, provide the scale and performance of our global footprint of cloud data centers, and deliver a common environment on which they can build once and deploy in any one of the appropriate footprints to be faster and more agile.”

IBM releases its next earnings report Wednesday – its first since closing on Raleigh-based Red Hat last week. The deal, execs said last week, will propel Red Hat – not constrain it under the IBM umbrella.

IBM “accelerate[s] our journey for us in spades, something that would have taken us many, many years to get to, if ever,” Paul Cormier, executive vice president and president of products and technologies, said July 9.

Red Hat CEO Jim Whitehurst said in a letter last week to employees that one of the next steps will be “exploring how to expand the availability of Red Hat’s portfolio in more places.” And, with 84 percent of enterprises working on a multicloud strategy, Red Hat is positioned to take full advantage of big contract wins, he wrote.

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