Like all brilliant minds in America, IBM’s Watson computer won’t be used to solve the great scientific problems of the world, but will instead be used for the time being on Wall Street. Specifically, Citigroup is renting Watson to help process financial, economic and client data to advance and personalize digital banking.
IBM expects to generate billions in new revenue by 2015 by putting Watson to work. The technology giant has already sold Watson to health-care clients, helping WellPoint Inc. (WLP) and Seton Health Family analyze data to improve care. IBM executives say Watson’s skills — understanding and processing natural language, consulting vast volumes of unstructured information, and accurately answering questions with humanlike cognition — are also well suited for the finance industry.
Financial services is the “next big one for us,” said Manoj Saxena, the man responsible for finding Watson work. IBM is confident that with a little training, the quiz-show star that can read and understand 200 million pages in three seconds can make money for IBM by helping financial firms identify risks, rewards and customer wants mere human experts may overlook.
Banks spent about $400 billion on information technology last year, said Michael Versace, head of risk research at International Data Corp.’s Financial Insights, which has done research for IBM.
Watson the financial assistant will be delivered as a cloud-based service and earn a percentage of the additional revenue and cost savings it is able to help financial institutions realize. Watson, including its work in the health- care and finance industries, will contribute “a portion” of IBM’s target of $16 billion of analytics revenues in 2015, Saxena said, and that portion will “have a B next to it.”