Why focus on the mainframe for a look forward? If you’ve read the rest of the IT-based rhetoric about 2022 and 2023, there is not much talk about the mainframe. This comes as no surprise since in many ways the mainframe is still siloed in many organizations. Even though this is changing, the IT journalism crowd does not put focus on the mainframe. Here is an example: a well-done article about what folks think 2023 will bring to IT—but no mention of the mainframe, and the only IBM mention is about the Power E1080 Server.
Not to pick on the journalists, but with the mainframe responsible for handling the largest workloads for the largest businesses, and supporting most new technologies, as opposed to being a legacy platform, I think we need to cover what’s going on with the mainframe in 2022–2023.
With the winding down of the world pandemic in 2022, I expected that there would be a significant business upturn as companies strive to recover from two years of uncertainty. However, the massive layoffs at Microsoft and Google indicate that instead, we may be seeing the start of at least a temporary tech recession. Whether this pans out or not is speculative. Further, we may have to temper some of the early 2023 predictions of an economic boom.
What has this got to do with the price of tea in China? That depends on of the direction the world’s economic trend, and with a war going on in Europe, that is going to be a very difficult thing to guess. Either way, the mainframe and its technological, and economic ecosystems should not be seriously impacted, at least not in a downward direction.
The reason for that is that historically, an economic recession resulted in a slowing of business in general, causing businesses running mainframe data centers to experience lower levels of transaction processing—and that meant a reduced need for mainframe upgrades from IBM and less demand for mainframe efficiency improvements from the mainframe ecosystem.
But at the same time, where there are employment reductions with affected businesses, there has been a corresponding increase in social assistance business with associated banking business – the result is that increases in transaction processing for government and banking systems have tended to offset the general business declines. At least, this has been a trend in past recessions.
Okay, maybe we’re getting ahead of ourselves—With uncertainty, the price of fuel and food is on the rise, and while that’s bad news for the population in general, it means more profits for those related businesses. And if those businesses are running mainframe data centers, that means there will be increased opportunities for upgrading and revamping those systems. It’s a vicious circle, and tough to guess what the crystal ball will reveal. No more guesswork, let’s take a closer look at what we do know.
The Arcati Mainframe Survey
Recently, the Arcati Mainframe Survey was published and the results were not unexpected. In general, MIPS usage has grown between 10 to 50% in 2022; 20 percent of sites are expecting growth in excess of 26 percent for 2023; generally, there has been more capacity increase for existing mainframe systems than there has been for existing cloud systems. Generally, mainframe data centers carry a higher percentage of the overall business data than their percentage of overall IT budget reflects. Yet these organizations consider moving off the mainframe a major cost reduction priority.
That seems to indicate that at least some people with budgetary authority do not understand what the mainframe does for their organization but really only see the associated cost. But that’s nothing new. We’ve seen that type of thinking for a long time, and IBM and ISV salespeople can confirm.
At this time, most shops are running the recent z15 platform, as the z16 is in its infancy in the market. Almost everyone uses zIIP, and almost half runs Linux (IFL). The largest mainframe shops don’t plan to move much processing off the mainframe over the next five years. Most mainframe shops also use cloud services of some sort (AWS, Google, Azure, etc.), but over 25% do not use cloud services, which is a surprise.
The priorities of mainframe shops also include reducing the number of vendors (bad news for the smaller ISVs in the mainframe ecosystem) and looking to gain new functionality in the cloud. IBM regularly argues that some ISVs are too inflexible and need to change their software pricing strategies, while the third-party suppliers respond that IBM is placing excessive pressure on them by using its size and influence to win over their customers.
The Mainframe in the News
Perhaps the biggest news in the mainframe world is IBM’s release of the new Z16, with its built-in on-chip AI, hardware improvements (like more memory fitting into a smaller footprint), and improved processing power and throughput. The pandemic saw serious uptake of the z15, which slowed the early uptake on the z16, but that is changing, and IBM expects 2023 to see significant z16 uptake. There is a lot more information on the z16 on the IBM site., on the Forbes site, and in Steve Guendert’s article. Only time will tell how the uptake on the new system will be, but honestly, pretty much every new mainframe system has seen eventual success, as upgrades are always desired by mainframe shops seeking more performance, more throughput, and more capacity for growth. The z16 will be a big winner as the larger shops make the upgrade eventually, followed by most other shops. And certainly, no big financial services IT shop will want to remain on an older platform when its life-and-death competitors are upgrading—it is the nature of the beast.
The AWS Situation
2022 saw an agreement between AWS and IBM, essentially partnering to work with IBM to improve the value of customer investments and to innovate faster. This was in response to an announcement in 2021 indicating that AWS was targeting the mainframe to “wipe it out.” Unsurprisingly, this apparently caused a lot of worry at IBM, as Amazon has become an industry behemoth. While the partnership announcement was good news for many, let’s be frank; Amazon would still like to target the mainframe and displace all that business, which would be a huge win in new business for them. Realistically, however, Amazon is about as likely to “wipe out” the mainframe as any other efforts in the past. The outcome of these past efforts has usually resulted in failure, typically because people obsessed with the mission don’t fully understand that the mainframe is actually the best and most cost-effective platform for large businesses running heavy-duty transaction processing. In the end, the AWS/IBM partnership makes the most sense for AWS, IBM, and organizations running mainframes in their data centers.
What are others saying?
I came down hard, perhaps unfairly, on one or two reputable IT news organizations for their lack of discourse regarding such an important part of the IT world, but are they all equally silent? The Forecast, a forward-looking IT news blog, says that the “Mainframe is a mainstay. Why take on a project to replace something that is working better than its potential replacement?” – which should resonate with business IT execs in the know.
Deloitte identifies trust as a common theme for 2023 tech trends and that mainframes will continue to prove their value as data stores—a pretty fair statement from a significant IT services player, despite their characterization of the mainframe being a “legacy” technology.
In summary, 2022 was a business-as-usual year for the mainframe, with continued IBM successes, and some important announcements. And 2023 looks to be the same for the mainframe, regardless of which direction the economy turns. Probably.
In addition to the planning, development and management of the Planet Mainframe blog, Keith is a marketing copywriting consultant where he provides messaging for corporate and partner products and solutions.