IBM inks $1.25bn cloud computing deal with WPP

US tech major IBM has signed more than a billion dollar contract with the world's largest advertising firm WPP to take the company's operations to the cloud.

IBM said it signed a seven-year $1.25bn (£796m, €1bn) deal to transform and manage WPP's global technology platform.

The agreement will enable WPP to innovate new digital services that will be run and managed within a global hybrid cloud infrastructure, IBM said in a statement.

"IBM will provide a service delivery and technology platform that allows WPP to integrate its operations while delivering significantly improved productivity," the company said.

"As the world's largest communications group, we are seeking to exploit IBM's cloud computing expertise to allow us to innovate and add value to both the service and the product we deliver to clients across 111 countries," said Robin Dargue, WPP Group chief investment officer.

Erich Clementi, senior vice president, IBM Global Technology Services, noted that the agreement extends the company's position as "the premier global cloud platform."

The company, which has been suffering from a profit decline, has recently clinched a number of deals with big multinationals, most of them valuing at more than $1bn.

On 2 December, the company signed a multi-year services agreement with financial information firm Thomson Reuters to provide IT services to employees globally.

That comes a day after IBM announced a multibillion-dollar deal to provide computer infrastructure services to Dutch bank ABN Amro.

In November, the company signed a $1.2bn agreement with air carrier Lufthansa to take over its information technology operations and staff.

In an interview with Reuters, Bart Van den Daele, IBM's general manager for strategic outsourcing in Europe, said big contract signings are coming into play again after a slowdown during the euro crisis.

"(There's) a new wave of these deals which is still continuing and we see it going forward," Van den Daele said.