That's somewhat narrowly defined considering they're really the only remaining producer of mainframes. I'm not sure if that's literally true but it may as well be.
There are some things that mainframes are legitimately better at, and some things that POWER is better at than x86, and so on. AMD and Intel benefit from incredible economies of scale that IBM could never dream of, and that's mostly where IBM loses -- the price is a lot higher and the volume a lot lower on the IBM side.
The main competitor isn't other mainframes, but PCs.
A lot of mainframe users never needed a mainframe, they just didn't want to get fired for not buying IBM. Other users need some sort of mainframe reliability, but that's also achievable on a distributed system running on unreliable PCs.
There are some users whose use is genuinely deeply entwined with features mainframes provide, but those are dying out.
"For instance, IBM now has about a 90% share of the mainframe market, but mainframe sales account for just a fraction of IBM's total revenues and profits."
Look at how much of the rest of IBM's revenues come from services related to mainframes. A significant part of IBM's service and support revenue is tied directly to IBM's mainframes -- a bit like Microsoft's Office, which isn't a core product, but it's tied to Windows, and it's part of what makes Windows profitable.
What differentiates IBM's mainframes from the few remaining competitors (there are only something like 10 companies in the world in that space) are advantages that Windows has no analog for -- Windows' biggest advantage right now is, comically, Windows (i.e. market share).
I'm curious, how many real competitors are there to IBM in the mainframe space? From what I've seen the majority of the products in use are basically IBM only.
You have no idea just how hilariously wrong you are. Just read this passage from an Economist article about IBM mainframes:
> At any rate, the mainframe is a hugely profitable business for IBM. Only around 4% of the firm’s revenues come from mainframe sales. But once additional hardware, storage, software and all kinds of related services have been factored in, the mainframe accounts for a quarter of IBM’s revenue and nearly half of profits, estimates Toni Sacconaghi of Berstein Research.
Read that again. HALF of profits. A QUARTER of revenue.
It's because they're not cost competitive. For the same amount of money you can get a whole heck of a lot more servers (CPU and memory!) running Intel, AMD, or more specialized hardware. Even if we're only talking about their (IBM's) cost!
If mainframes were actually competitive with modern server hardware everyone would be using them. Even IBM uses regular Intel hardware in their cloud stuff!
Mainframes aren't even fast... IBM will make all sorts of BS claims about memory speed and the bandwidth of their interconnects and whatnot but all of it is 100% artificial benchmark nonsense that doesn't translate into real-world usefulness because nobody is rewriting their mainframe shit to take advantage of it.
I don't know about you but in the time I've been in IT "hardware failures" that actually had any sort of serious impact on operations were few and far between. The whole point of modern solutions (everything from N-tier architecture to containers and on-demand compute/function stuff) is to make the hardware irrelevant. At my work we had a whole data center taken down as part of a planned test and I doubt that any end users even noticed (and it was down for hours because they screwed something up when bringing things back online hehe). I think something like 6,000 servers and some large amount of networking equipment were complete powered down? I don't know the specifics (and probably shouldn't give them out anyway).
The whole point of mainframes is to serve a function: All the hardware is redundant/super robust (within itself). That function is mostly meaningless in today's IT infrastructure world.
Yeah. Mainframes are arguably the most vertically integrated products there are and yet they’re a dying breed in a rent-maximizing at best industry than a growing one.
It's too painful for people to check their facts before declaring mainframes dead or something IBM is leaving. As you said, they're incredibly profitable. Same thing happened with OpenVMS, which turned out much profit for HP despite little investment. Next they'll be telling us Group Bull, Unisys, and Fujitsu are similarly scraping by in the mainframe business. And NonStop and IBM i are on verge of cancellation. And blah blah blah.
I'm sure we'll be hearing the same crap in a decade while said crap is posted via a service that imtegrates with a COBOL app on a mainframe. ;)
Mainframes are a category of their own and IBM is the last company in the category.
Mainframes have spectacular capabilities, like running a compute on multiple CPUs in multiple data centers to ensure integrity and survivability built in so that any software can take advantage of it. They have the lowest transaction processing costs of any machine. They detect hardware issues and phone home to order repairs without user intervention. And on and on and on.
Quite frankly, a lot more companies should be using IBM mainframes than trying to build a reliable infrastructure on the cloud.
They also aren’t very powerful in reality, just old software that is proven and reliable. Almost all of the non-IBM mainframes are just Xeon boxes these days.
One vendor that I’m familiar with sells a box equivalent to a HP DL580 that would cost about $50-100k for $2-3 million.
Mainframes have to implement a fifty years old architecture, and I suspect they have vastly smaller engineering teams, since their market is orders of magnitude smaller than those of Intel or ARM. Also I seem to remember IBM being seriously hostile towards independent benchmarks.
Also, if they were competitive wrt performance, people would be using them. In real life they are rarely found outside of financial institutions.
This is what IBM and people living off mainframes tell the world all day long, but I think you'll have trouble showing that mainframe's job can't be replaced by a few hi-end x86 servers under cost.
Inertia, regulators, and company having lots of money to the point they don't care (banks...) explains mainframes. They do the job well, so why bother replacing them if you don't care that they cost more.
the mainframe / high end server market generates only a small portion of the overall profit at IBM. And it has by far not the highest margin (that would be software and services). Just read the earnings report from last year.
Those mainframes are actually pretty modern and interesting.
If IBM split off half of their mainframe division and let some competition get going I think the segment could actually be something to contend with.
The basic idea of the IBM mainframe is almost perfect for what a lot of companies actually need (massively reliable hardware to support lots of middling software; most work is shunting data around) but everyone knows they're going to get locked into IBM.
There are some things that mainframes are legitimately better at, and some things that POWER is better at than x86, and so on. AMD and Intel benefit from incredible economies of scale that IBM could never dream of, and that's mostly where IBM loses -- the price is a lot higher and the volume a lot lower on the IBM side.
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