From Web Browsers To Mainframe Tools: Competition Drives Innovation

Today few organisations would deny that there exists a competitive web browser market. Organisations and consumers alike can choose from multiple, viable web browser solutions for various platforms. Marketing messages based on stronger security, faster browsing and better plug-ins are just some of the areas in which differentiation occurs.

But it was not that long ago that Microsoft had effectively mothballed its active investment in the web browser and sent the majority of the Internet Explorer (IE) development team off to do other things.  
 
With Netscape routed and IE embedded into every edition of Windows being shipped there was no need to invest in pushing the envelope when in 2004 IE's market share had reached over 90%. Browser innovation had died and focus shifted to addressing bugs. That is until the emergence of Firefox which by 2005 had forced Microsoft to once again consider features over fixes and saw the introduction of tabbed browsing, plug-ins, and more. Today Microsoft's share of this market, even on its own Windows platform has dropped by 20% (see Figure 1). 



When considering the mainframe market today it is very easy to spot the parallels to the fall of Netscape and the "age of IE" (brief as it was). IBM now has anywhere from 90 to 98% of the mainframe market, having recently put its last serious rivals in this space such as Fujitsu, Unisys, to the sword. Even the irrepressible march of the x86 based Linux and Windows machines seems to have failed to dent the global appetite for mainframe processing with global MIP usage growing at between 18-20% year-on-year. According to CA, MIP usage fell to an all time low around 2000, but has since grown back to its 1996 peak level s and continues to rise. In growth markets adoption of mainframes to support financial services and other economically critical processing has seen revenues for System Z grow by close to 40% in these regions.   
 
It is this type of buying behavior in both traditional and emerging markets which lead the Computer & Communications Industry Association (CCIA) to point out just how critical mainframes are to modern society, and therefore how important it was that regulators should monitor competition in this market. According to the CCIA "the backbone of the world's financial markets is built on mainframe computers" and specifically they noted "that over 80% of the world's corporate and government data resides on mainframes¹. The increasing use of virtualisation and cloud computing will only further the opportunity for public and private cloud providers alike to re-consider the stalwart of the mission critical data centre. Not to mention IBM's highly successful Linux on System Z strategy opening the mainframe platform up as a platform for consolidation of traditional mid-range and x86 workloads. At a recent briefing on their visions for the data centre of the future EMC's Chief Technology Officer for Asia Pacific, Par Botes noted that continued consolidation will ultimately seek to target fewer highly reliable servers than many commodity servers.
 
Given that many of our clients are counted among the mainframe users of today, Longhaus received a briefing from CA on their Mainframe 2.0 strategy at CA Expo 2009 in Melbourne this month. CA has made no secret that they are re-investing in their extensive portfolio of mainframe tools with announcements on the Mainframe 2.0 strategy made earlier this year. This commitment has now been followed-up with a demonstration of the tangible outputs from this investment in the form of their CA Mainframe Software Manager. Unlike traditional mainframe tools which for many years have languished with terminal-based inputs or dressed up with some Web 1.0 lipstick via screen scraping, CA's new approach represents a re-think of the role description for the modern mainframe support person. Specifically CA have recognised that the modern mainframe system administrator is often also supporting other non-mainframe platforms and performs functions that in the last century were done by multiple people. In the face of such a shift functions of traditional mainframe tools should logically be consolidated, the interface upgraded and made to look, feel and integrate into the suite of tools people have come to expect on Linux, Unix and Windows.
 
Like Firefox, CA is forcing innovation from a competitor whose software tools are deployed on a platform where they have a stranglehold in the market. Like Microsoft's use of its Windows dominance to saturate the browser market, IBM's dominance of the mainframe hardware and operating system business has allowed it to accept fixes over features when it comes to mainframe management tools. If the rate of compound growth for Firefox in the web browser market since 2004 is anything to go by, then CA is poised to see their existing market share grow by over 50% per annum over the next 2-4 years. In our view this is good news for enterprises seeking ICT management innovation in what has always been a mission critical platform of choice. It is an innovation wakeup call for CA's competitors, including IBM itself.

¹ http://www.ccianet.org/artmanager/publish/news/IBM_Tightens_Stranglehold_Over_Mainframe_Market_Gets_Hit_with_Antitrust_Complaint_in_Europe.shtml