IBM, Magna sign 5-year development deal

IBM Corp. and Magna Electronics in Sailauf, German have signed a five-year, multimillion dollar deal to support Magna's entry into the vehicle electronic systems market. Financial terms of the pact were not disclosed.

"By combining the respective expertise of IBM and Magna Electronics, we expect to bring vehicle electronic systems with enhanced innovative features and functions to the automotive market more quickly and efficiently," Matthias Arleth, Vice President of Magna Electronics Europe, an operating unit of Magna International Inc., said in the statement.

Under the deal, IBM will provide Magna with systems design, software development and engineering expertise to help the company develop vehicle electronic information systems. In return, Magna gets IBM's expertise in automotive products and production know-how, combined with IBM's knowledge of custom design, engineering and intellectual property issues, the companies said.

"...If you take a look at the automotive industry, the car is becoming an incredibly complex IT environment operating today," said Bernie Meyerson, CTO for IBM's Systems and Technology Group.

Meyerson said IBM technology like speech recognition can be used to develop applications in the automotive field that require immensely sophisticated bits of software, hardware and optics. But to do so successfully, IBM needs to work "very closely with Magna because Magna has enormous industry expertise and a terrific relationship with the OEMs. Magna understands this market.... This has tremendous opportunity for both organizations."

The system the two companies envision building includes: