GE and Microsoft to Announce Partnership

General Electric Co., along with Microsoft Corp., will be announcing a deeper partnership which involves GE’s Predix industrial internet platform and Microsoft's Azure cloud platform.

Predix is a software developed by GE. Its function is to link industrial equipment such as jet engines and power plants to computers that will be able to foresee failures as well as lessen operating costs.

According to GE Digital’s Chief Executive Bill Ruh, the agreement largely magnifies the integration of Microsoft’s cloud software with GE’s Predix applications.

The joint effort will initially focus on oil and gas mining companies but will then be available for use to other companies that runs Microsoft software, which, according to Ruh, includes the vast majority of industrial companies.

GE Chief Executive Officer John Flannery and Microsoft Chief Executive Officer Satya Nadella are set to announce the partnership on Wednesday; just days after GE’s announced partnership with Apple Inc., which demonstrates GE’s ability to recover from the shaky phase it faced with Predix.

GE CEO: More Partnerships in the Future

Flannery said on Wednesday that the company will use more alliances in order to construct its digital-industrial business in the coming years.

GE’s CEO’s statement suggests that the company will be reducing their expenses in that area.

The industrial conglomerate will be investing $2.1 billion this year in GE Digital, as executives stated that that amount will decline by fall 2018.

Flannery’s first direct remarks about the digital strategy, since he was seated on August 01, began on Wednesday. Costs in other areas were lessened, also reducing the staff, grounding corporate jets, and putting a stop to the “Maserati benefit” of corporate cars for about 600 senior executives.

New financial targets for GE is set to be announced by Flannery on November 13, while also under heavy pressure to turn around GE’s third quarter earnings and cash flow issues,  both of which had missed their targets.

Flannery also disclosed on Wednesday that the company will concentrate its full attention on selling Predix in its own businesses which are energy, oil-and-gas, aviation, healthcare, transportation and mining. In regards to other markets, he said, “We're going to be more selective ... and do it largely through partners.”

According to GE executives, they are currently focusing on creating apps for Predix in order to boost sales, they also said that the company is planning to bundle applications for both equipment monitoring and service technicians.

So far this year, GE stock has fallen 32 percent while the S&P 500 index is up 14 percent.

HQBroker is here to give you a daily news roundup about the forex, commodities, technologies, automobiles, and economies. You can open an account now and make yourself updated with essential news in the market.