Nokia and Bosch's Connected Devices and Solutions division are pooling resources to lead the way in the creation of IoT technology.
The two European giants will combine their respective expertise in connectivity and manufacturing to provide a range of solutions for businesses.
Announcing the agreement this week in a joint statement, the pair confirmed that special areas of focus will be logistics automation and tracking, environmental control and industrial automation.
Nokia will implement IMPACT, its IoT device management platform, and predicts that IoT's worth will be 36 times more than the potential value of today's internet by 2020.
Bosch will contribute with its smart connector sensor devices, which help manufacturers improve the safety and efficiency of their equipment.
"We are excited to announce this strategic partnership with Nokia," said Dr Markus Lang, CEO of Bosch Connected Devices and Solutions. "With our companies' complementary offering, Nokia is the perfect partner to build comprehensive IoT business solutions."
Nokia's head of strategic partnerships, Laurent Le Gourrierec, added: "We are delighted to have reached a strategic agreement with Bosch.
"This combination of devices, connectivity and services from two worldwide leaders will allow for the rapid deployment of large-scale, innovative IoT applications."