IBM and Vodafone have joined forces to create a venture aimed at developing cloud, AI, and 5G solutions for enterprises ‘across Europe and beyond’. The eight-year deal is said be valued at around $550m (£426m/€480m).

Under the agreement, Vodafone Business customers will gain access to the full portfolio of IBM’s cloud offerings, while IBM provides managed services to Vodafone Business’ cloud and hosting unit. Furthermore, the pair will work together on digital solutions relating to the Internet of Things (IoT), 5G, and edge computing.

According to the companies, the venture has been designed work like a startup and “be responsive to rapidly changing market and customer demands”. The venture will become operational in the first half of this year.

“Together, IBM and Vodafone will use the power of the hybrid cloud to securely integrate critical business applications, driving business innovation – from agriculture to next-generation retail,” said Ginni Rometty, chairman, president and CEO of IBM.

“This strategic venture with IBM allows us to focus on our strengths in fixed and mobile technologies, whilst leveraging IBMs expertise in multicloud, AI and services,” added Nick Read, Vodafone CEO. “Through this new venture well accelerate our growth and deepen engagement with our customers while driving radical simplification and efficiency in our business.”