The Mainframe in Asia-Pacific: Challenges, Trends and Opportunities

Dallas Newton, Regional Director of Vertali APAC, discusses the continued relevance and growth of mainframe technology in the Asia-Pacific region

The mainframe continues to retain its status as a cornerstone of IT infrastructure around the world, and the Asia-Pacific region is no exception. Set to grow at a rate of almost 10% a year to 2031, the region accounts for almost one-quarter of the global mainframe market.[1]

Thirty or more years ago there was a proliferation of mainframes in the region, large and small, as well as various midrange computers in the market (e.g. AS/400 and Unix). Back then, there were many more equipment manufacturers, including Fujitsu, Hitachi, Amdahl and Unisys. Today, we’re really only talking about one, IBM, and the operating system z/OS (well, maybe also z/VM and zLinux).

Organizations started moving off the smaller mainframes to client/server environments and the lure of UNIX and Windows, mainly driven by cost and emerging technical skill considerations. Operating systems like DOS, VSE, z/VSE and OS/400 are gradually disappearing alongside the smaller mainframe platforms. Meanwhile, issues including downsizing and operational cost savings became front of mind, and sometimes entire sectors—such as manufacturing—moved to more cost-effective geographies.

Today, many smaller z/OS sites are working through outsourcers to benefit from consolidated licensing and operational cost savings. The larger mainframe users are typically found in government, semi-government, financial services organizations such as banking and insurance, and telecommunications, where some transformations off the platform have proved to be expensive, abject failures, or both.

It’s possibly a similar pattern across the region; I suspect the mainframe footprint in banking and finance is even greater in Southeast Asian countries and Japan, for example. We’re seeing the continued rise of China in mainframes, both in producing hardware and in the country’s own use of mainframe technology.

So, what are some of the other key trends we’ve seen over the last few years that continue to affect us today in the Asia-Pacific region? As you might expect, we’re subject to many of the same issues and challenges as other regions, but with some local variations.

Like the U.S. and Europe, we’ve had many years of organizations saying they plan to sunset the mainframe but, in many cases, it hasn’t happened. In its 60th year and beyond, the mainframe not only continues to be essential to the operations of many organizations, it’s actually increased its importance and footprint. Becoming a hub for digital transformation, it supports:

• Modernization initiatives such as DevOps
• Multiple operating systems such as Unix/Linux
• The transfer of some workloads to specialized processors such as ziiP
• Open-source technologies such as Java, Git, Jenkins
• Enhanced security features including multi-factor authentication (MFA), cryptography and quantum-safe processing

Indeed, the last few years have seen the increasing use of mainframes with new and emerging technologies and applications, such as artificial intelligence, machine learning, big data, natural language processing (NLP) and blockchain. There’s now a great deal of crossover between the mainframe and the open-source community, drawing on key mainframe design principles of security, stability, sustainability and performance. Interoperability and hybrid infrastructure are the name of the game.

Speaking of which, there’s an increasing use of hybrid and cloud solutions, which influence where best to consume processing power. Some applications, like customer relationship management (CRM), human resources (HR) and finance, are good candidates for the cloud. But secure transaction-intensive applications like large-scale data processing, banking, payments and credit cards are still perfect for mainframe processing. And in a climate of rising cybercrime and increased internal and external threats, there’s growing demand for more innovative and effective security measures as organizations work toward a zero trust stance.

The final trend I can mention will, I’m sure, come as no surprise. As it seems similar elsewhere in the world, there’s a lack of available technical expertise and experience when it comes to managing and optimizing mainframe installations in the region. In this area, we’ve had notable successes with our Grey Pool© offering – an on-demand consulting service that utilizes the skills and experience of older mainframers to provide consulting, project delivery and mainframe support services, as well as mentoring the “next-gen” of mainframers. Through this, and at a corporate level, our New to Mainframe (NTZ) program for mentoring our own “next-geners”, we are working as an active enabler of skills development, both inside our own organization and as part of the wider mainframe community. As for that bigger picture, programs developed to address this skills gap include the new IBM-sponsored Mainframe Skills Council, which seeks to foster a diverse global community of mainframe talent. Vertali is a founding member.

What we’re seeing in the field, and I’m hearing in my conversations with mainframe professionals in all sectors, is a continued appetite for mainframe operations and modernization, resulting in a high demand for expertise, skills and support in areas ranging from security and cyber resilience to software migration/consolidation, modernization and optimization projects.

In summary, despite the advent of alternatives, the mainframe has continued to evolve its unique, robust, scalable and secure architecture. Particularly suited to critical commercial and government sectors, it has embraced change and expanded its capabilities to connect and collaborate with the open-systems world. The mainframe today is leveraging its inherent capabilities to provide a single platform to run all workloads – a platform that is one of the most secure, scalable and, possibly for large enterprises, the most cost-effective computing platform available today.

However, a remaining challenge for the platform is the continuing skills shortage, as the mainframe transitions from the traditional support generation to that of the new generation. Vertali has embraced this transition, and I’ll return to this theme in a future blog.

About the author

Regional Director for Vertali APAC, Dallas Newton has more than 45 years’ experience in the IT industry and is a well-known figure in the Australian market. His long career includes stints working with mainframes in Australia and the UK with organizations including ICL, Fujitsu, Broadcom (formerly CA) and as a business partner of IBM. Dallas was previously CEO of The Business Agility Group (Australia) Pty Ltd (TBAG) before embarking on a joint venture with Vertali UK in September 2023, rebranding the business as Vertali APAC Pty Ltd.

[1] Mainframe Market Report 2024 (Global Edition) – Cognitive Market Research (Decipher Market Research). “Asia Pacific holds the market of around 23% of the global revenue with a market size of USD 725.01 million in 2024 and will grow at a compound annual growth rate (CAGR) of 9.6% from 2024 to 2031.”