https://finance.yahoo.com/news/ibm-simplifies-modernization-mission-critical-140000263.html
5 replies (most recent on top)
Zzzzzzzzzzzz
The "miss" with their plan, and they have to know this already... is that for it to be truly successful they would need to partner with AWS, AZ and GCP. Or at least two of those.
Not many will be roped into doing ZAAS with IBM when everything else they run is in another cloud and the latency makes it a non-starter for some applications.
If they do get roped into it, short term, it will only be for long enough to do what most are doing already... moving on to other platforms. It's slow, but it's happening.
z/OS as-a-service in the public cloud actually makes a lot of sense. But IBM should've offered it 10-15 years ago. Even the article says won't be GA until 2H 2022, typical lack of urgency. AWS/Azure/GCP all making a big play to move mainframe workloads to the cloud RIGHT NOW - customers get their flavor of hosted Kubernetes free (no need to pay for OpenShift), free migration services/consulting, deep consumption discounts/credits for signing multi year deals.
AK can only play the cards he has. What has every other cloud company exploited? Their monopoly power! Google has search, Microsoft has windows, Amazon has first mover. All exploit their monopoly pricing power for advantage THUS IBM exploits mainframe. The equation is simple Does legacy modernization of mainframe cobol grow faster than the shrink rate of legacy “everything else” If yes, IBM has a future due to the VAST amount of legacy cobol and it’s opportunity to move to LINUX via Redhat. If no, IBM is an annuity harvesting it’s cash flow for annuity payments. So if it’s not modernization, what is AK’s play? It’s lowering your cost for the established Legacy cash flow to show a growth of earnings per share. In other words how does a services business lower their costs. Automate, or cut employee costs. My guess is IBM will do both, but automation is non-predictable, while lowering employee costs are very predictable. So where is the low hanging fruit? IBM will attack the employee costs because they are predictable and Wall Street demands predictability.
IBM has no choice... the only place where IBM still rules is the mainframe. When that is gone, bye bye IBM.
But it is also the realization for AK that IBM has lost everywhere else!