IBM is set to announce a deal with Turner Broadcasting Monday under which Turner will use IBM's hybrid cloud services to power its over-the-top, TV Everywhere channels in Latin America. Turner is a subsidiary of Time Warner (TWX) .
The deal, which will be announced at IBM's annual InterConnect conference in Las Vegas, marks one of the first hybrid cloud relationships that the technology giant has struck in the media and entertainment industry. A hybrid cloud model allows IBM's clients to manage some resources internally and others on IBM's platform.
Terms weren't disclosed, but IBM executives said that they see growing demand from media companies for cloud services as they rapidly move to an era where consumers are connected to content everywhere.
"It's a huge opportunity for us," Angel Luis Diaz, IBM vice president of cloud architecture and technology, said in an interview in Las Vegas. "It's about connecting, about bringing your content into new markets, with new uses and applications."
IBM has been investing heavily in hybrid cloud at a time when its overall business has been faltering. IBM's revenue from continuing operations fell 6% last year from 2013, but cloud-based revenue rose 60% year over year to $7 billion.
IBM has partnered with Kaltura, which will use its video software to power Turner's new over-the-top channels in Brazil and the rest of Latin America.
The deal kicked off Sunday when Turner's TNT Go channel streamed the Academy Awards live to more than 50 million cable subscribers in that region.
IBM's cloud infrastructure is hosting the Turner Broadcasting TV Everywhere platform, allowing the network to be accessed via smartphones and tablets.
Turner is expected to use the same platform when it launches another of its Latin America channels, Space Go, on mobile devices, Turner spokeswoman Caroline Rittenberry said.
In an interview late last year, Steven L. Canepa, general manager of IBM's media and entertainment division, touted the potential of the cloud in a "connected consumer era," predicting that it will allow media companies to reach 5 billion smartphones by 2018.
In 2013, IBM acquired cloud infrastructure provider SoftLayer Technologies for a reported $2 billion and has invested $1.2 billion to expand its global footprint in 40 cloud centers.
As of the fourth quarter last year, IBM was the hybrid cloud market leader with a 13% share of the market, according to Synergy Research Group.
"IBM has a long and rich history of association with that sector," John Dinsdale, a chief analyst at Synergy Research, said in an interview. "It has also made some huge investments."
IBM is expected to announce additional hybrid cloud investments and products at the InterConnect conference.
The company said that it will add four new cloud data centers.
It has also struck strategic partnerships with global technology consulting firms Computer Sciences Corp. (CSC) and Tech Mahindra.Tech Mahindra will train 5,000 of its developers to use IBM's digital platform BlueMix.
This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.