Boeing and IBM form strategic alliance

Boeing Co. and IBM Corp. today announced a 10-year alliance established to pursue what the partners estimate is a $200 billion market for ground and space-based systems used in network-centric operations.

The two companies will develop digital communications and information technologies necessary to share information among multiple platforms, including satellites, aircraft and handheld radios, company officials said. The two already are investing jointly in research and development of software and communications.

Jim Albaugh, president and chief executive officer of Boeing Integrated Defense Systems, said the agreement is in line with Boeing's strategy of partnering with IT companies rather than vertically integrating a wide range of technical capabilities under one roof.

"The Boeing and IBM team will deliver the finest digital information technology industry has to offer," Albaugh said. "With capabilities enhanced by this new technology our defense and intelligence community will gather real-time information and communicate it across all levels of command for maximum effect."

The partners are actively pursuing four intelligence and eight Defense Department programs, Albaugh said, although he declined to name the programs. Depending on the nature of the contracts, he said, either company could lead the effort, with the other acting as subcontractor.

IBM will provide Chicago's Boeing with off-the-shelf information management middleware, applications, microprocessor technology and designs for electronic systems. The company will also help integrate technology into networking and computing systems being developed for the Defense Department and other government agencies.

"We want to help government toward horizontal integration using commercial technologies," said John Kelly, senior vice president at IBM, Armonk, N.Y.

With 2003 prime federal IT revenue of $3.4 billion, Boeing ranked No. 4 on Washington Technology's 2004 Top 100 list, which measures federal contracting revenue. IBM ranked No. 11 with more than $900 million in prime federal IT revenues.