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The Mainframe Continues to Lure Wall Street

With the rise of big data, mainframe computers are enjoying a resurgence of sorts. But many experts point out that 'big iron' never really went away in the first place.

A Smart, If Not Trendy, Choice

While the mainframe has myriad uses, financial firms' choice to continue using the computers known as "big iron" as opposed to other technologies also is driven by a growing understanding of the economics of technology, notes Howard Rubin, founder of Rubin Worldwide. "The choice of a computing platform is an economic- and service- and risk-based decision. It's not a fashion decision," he says. "You're looking for superior economics for very complex times for the financial services community. They have to drive their margins. So they need performance at the best possible price. That doesn't always mean the mainframe, but it doesn't mean mainframes are out of the game."

IBM's Muckenhaupt reports that 96 of the top 100 banks today use mainframe computers. "The need to streamline their operations to bring workloads back on the mainframe allows them to save costs," he says.

[The Technology Economics of the Mainframe: Mainframe Computing Still Growing in Banking]

Far from being stuck in a time warp, mainframes actually are a highly current -- and constantly updated -- platform. In August, for example, IBM launched its latest mainframe server, the zEnterprise EC12, with a clear focus on boosting security and performance. "With operational analytics and near-real-time workload monitoring and analysis, clients can use the new zEC12 for a variety of workloads, including hybrid clouds that can take advantage of the system's 25 percent more performance per core and 50 percent greater total system capacity than its predecessor as well as the world's fastest chip," IBM said in a release announcing the new server. The new IBM mainframe includes new memory technology called Flash Express that can help boost the performance of data-intensive applications or workloads, according to the computer giant, which says the technology is designed to provide improved availability during bursts of system activity experienced at transitional periods, such as when financial markets open.

And while massive mainframes have historically had a huge footprint in data centers, that too is changing. In 2010, IBM introduced hybrid computing with the launch of the IBM zEnterprise System and the IBM zEnterprise BladeCenter Extension (zBX), allowing firms to deploy and integrate workloads across mainframe, POWER7 and System x servers and manage these diverse resources as a single, virtualized system. Firms can also consolidate thousands of distributed systems using Linux running on the new zEC12 mainframe, lowering the IT operating expenses associated with energy use, floor space and software licensing, IBM notes. "One zEC12 can encompass the capacity of an entire multiplatform data center in a single system," the company said.

For Ameriprise Financial's Kupper, "The mainframe is back to the future." He adds, "It never really went away. Now it has an even more important role: It's a large distributive processor."

Technological devices may be getting smaller, but given the financial industry's need for a reliable, secure way to accumulate and analyze data at a faster rate than ever before, the mainframe appears destined for new life. "Those chunks of old iron aren't getting smaller, but they probably have a special footprint in the data server," says Aite's O'Connell.

Melanie Rodier has worked as a print and broadcast journalist for over 10 years, covering business and finance, general news, and film trade news. Prior to joining Wall Street & Technology in April 2007, Melanie lived in Paris, where she worked for the International Herald ... View Full Bio

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