Enterprise Modernization Services Part 2: Mainframe & Legacy Modernization

We’re pleased to share Part 2 of ComCap’s Enterprise Modernization Services series, focused on Mainframe & Legacy Modernization and the growing strategic value of the systems that still power many of the world’s most critical institutions.

The sector is entering a new phase. Mainframe modernization is no longer defined by whether enterprises move away from legacy infrastructure, but by how they unlock its data, reduce operating risk, and connect mission-critical workloads to cloud and AI environments.

What stands out:

AI is expanding the scope of modernization. GenAI is accelerating code discovery, documentation, and transformation, shifting projects from technical migration toward broader business reimagination.

Hybrid is becoming the practical end state. For regulated and mission-critical environments, the priority is often not full replacement, but secure integration across mainframe, cloud, APIs, DevOps, and modern data platforms.

Scarce talent is becoming an M&A catalyst. COBOL and z/OS expertise remains difficult to replace, increasing the strategic value of firms with certified practitioners, proprietary tooling, and recurring managed operations.

Buyers are paying for lower execution risk. Deterministic transformation IP, verifiable equivalence, automated testing, and rollback safeguards increasingly matter more than standalone LLM capabilities.

The market is estimated at $8.3BN in 2025 and is projected to reach approximately $18.6BN by 2034, while selected transactions since 2020 represent approximately $23.9BN of disclosed value across 17 deals.

Our view: the next wave of consolidation will center on firms that can combine AI-enabled modernization with dependable execution, regulated-sector credibility, and durable recurring revenue.