I’ve been getting a steady trickle of inquires this year about the future of the mainframe from our enterprise clients. Most of them are more or less in the form of “I have a lot of stuff running on mainframes. Is this a viable platform for the next decade or is IBM going to abandon them.” I think the answer is that the platform is secure, and in the majority of cases the large business-critical workloads that are currently on the mainframe probably should remain on the mainframes. In the interests of transparency I’ve tried to lay out my reasoning below so that you can see if it applies to your own situation.
How Big is the Mainframe LOB?
It's hard to get exact figures for the mainframe contributions to IBM's STG (System & Technology Group) total revenues, but the data they have shared shows that their mainframe revenues seem to have recovered from the declines of previous quarters and at worst flattened. Because the business is inherently somewhat cyclical, I would expect that the next cycle of mainframes, rumored to be arriving next year, should give them a boost similar to the last major cycle, allowing them to show positive revenues next year.
I’ve been talking to a number of users and providers of bare-metal cloud services, and am finding the common threads among the high-profile use cases both interesting individually and starting to connect some dots in terms of common use cases for these service providers who provide the ability to provision and use dedicated physical servers with very similar semantics to the common VM IaaS cloud – servers that can be instantiated at will in the cloud, provisioned with a variety of OS images, be connected to storage and run applications. The differentiation for the customers is in behavior of the resulting images:
Deterministic performance – Your workload is running on a dedicated resource, so there is no question of any “noisy neighbor” problem, or even of sharing resources with otherwise well-behaved neighbors.
Extreme low latency – Like it or not, VMs, even lightweight ones, impose some level of additional latency compared to bare-metal OS images. Where this latency is a factor, bare-metal clouds offer a differentiated alternative.
Raw performance – Under the right conditions, a single bare-metal server can process more work than a collection of VMs, even when their nominal aggregate performance is similar. Benchmarking is always tricky, but several of the bare metal cloud vendors can show some impressive comparative benchmarks to prospective customers.
The word on the street is that Nuance is buying the online virtual agent company VirtuOz for an undisclosed sum (see the TechCrunch article here). So what does this acquisition mean?
Let's start with Nuance. Nuance’s solutions help engage customers with what it terms “smart, automated conversations.” Its customer service solutions revolve primarily around the voice channel and support both inbound and outbound interactions. Nuance’s main building blocks focus on speech and touch-tone automation solutions, speech-enabled call-routing solutions, voice authentication, and outbound notifications. Recently, it launched Nina, a virtual assistant product targeted at the enterprise for mobile customer service. Again, Nina leverages much of Nuance’s core expertise in voice biometrics, speech recognition, text-to-speech rendering, and natural language understanding to empower customers to ask questions and receive relevant answers to questions like “Did my last check clear?” without tortuous back-and-forth conversations between the customer and the service organization.
What Nuance does not have is a complete customer service solution, being so focused on voice interactions. Specifically, Nuance lacks web self-service solutions to support the increasing popularity and usage of these digital channels. This is where VirtuOz comes in.