Most AI-powered mainframe migration vendors expected to fail by 2030, Gartner warns

Gartner predicts 75% of mainframe exit vendors using generative AI will pivot or shut down by 2030 due to a gap between marketing and reality.

You may have read that many companies still run code written in ancient programming languages like COBOL and pay a handsome sum for those who can maintain that code. Well, it looks like this area of the tech world could be the scene of an AI bubble.

It turns out that there are mainframe exit vendors, helping companies move their legacy mainframe systems to modern cloud environments or servers such as Microsoft Azure and AWS, using generative AI tooling. Unfortunately, 75% of these vendors are now expected to pivot or cease operations as market realities take hold by 2030.

Alessandro Galimberti from Gartner said:

“There is a widening gap between the marketing promise of GenAI and its real-world ability to transform and migrate complex legacy code. At the same time, intense investor pressure is pushing vendors to embed AI into their offerings regardless of whether it meaningfully improves outcomes. When this is combined with the ‘too-big-to-fail’ nature of mission-critical mainframe applications and the accelerating loss of experienced talent, infrastructure and operations (I&O) leaders face a perfect storm of risk that makes poorly planned exit strategies increasingly untenable.”

Some of the companies in the mainframe exit market are IBM, 21CS, BMC, Broadcom, Rocket Software, DXC, GTSG, and Kyndryl. The reasons some of these firms are expected to quit the market are a reset of market expectations and a decline in demand for one-size-fits-all migration solutions. The reset in expectations is likely to be driven by cost overruns and threats to business, and the potential occurrence of critical failures within businesses as a result of bad transition implementations.

These insights from Gartner are pretty interesting because it’s a specific area of the market where doubt is being cast on generative AI. Many people have cast doubt on whether AI companies will successfully justify the massive amounts spent on GenAI to date, and this data from Gartner suggests the road could be rocky for GenAI.