IBM Reports Surging Mainframe Sales as AI Tackles COBOL Modernization Challenge
Big Blue bets on generative AI to help enterprises modernize decades-old code as z17 demand exceeds expectations
The mainframe, long considered legacy technology, is experiencing a renaissance as companies realize the prohibitive cost and risk of full cloud migrations for mission-critical systems. IBM's pitch: use AI to understand, modernize, and extend existing COBOL code rather than replace it entirely.
The strategy addresses a looming crisis. The average COBOL programmer is over 50, and few new developers learn the language. Yet COBOL still processes an estimated 95% of ATM transactions and 80% of in-person banking transactions globally.
IBM's AI tools can analyze COBOL codebases, generate documentation, and even suggest modernization paths, making the technology accessible to developers without mainframe expertise.
Analysis
Why This Matters
COBOL runs critical infrastructure. The developer shortage is real. AI-assisted modernization may be the only practical path forward for many enterprises.
Background
Trillion-dollar industries run on COBOL. Previous modernization attempts have often failed catastrophically, making incremental AI-assisted approaches attractive.
What to Watch
Watch for major bank and insurance company announcements about mainframe modernization. This could be a multi-decade market opportunity.