Bank-Turned MSP Sees Growth in IBM i
March 1, 2017 Alex Woodie
There aren’t a lot of areas of the IBM i business that are growing these days. Fewer companies are running the platform, which causes young people to look elsewhere to start their careers. That dynamic is actually helping to drive business for First National Technology Solutions, which was an IBM i customer before becoming a managed service provider (MSP).
In January, First National Technology Solutions (FNTS) announced it was seeing “a sharp increase” in demand for IBM i and mainframe hosting. While the Omaha, Nebraska-based company gets most of its revenue by providing private and hybrid cloud hosting for Windows and Linux environments, its IBM big iron business is seeing a bit of a boom.
“Surprisingly enough, it’s a fairly good-sized business,” FNTS CTO Ralph Wasner tells IT Jungle. “We’re actually training people in how to support the mainframe and the IBM iSeries.”
FNTS has dozens of IBM i and mainframe customers, who typically rely on the company to provide a stable operating system environment and to provide basic care and feeding, including applying patches, backing up data, etc.
The company, which operates two data centers–a primary data center in Omaha and a disaster recovery (DR) site in Chicago, Illinois–currently employs three IBM i administrators, and is training another three to be ready when the expected demand materializes, Wasner says. “We’ve had a lot of customers [inquire about IBM i MSP services] and we want to have people staged and ready to go when it happens,” he says.
Having the right people with the right mix of skills is critical, especially considering the fact that the lack of skills is often a primary driver in a company’s decision to seek a cloud MSP to host their business applications in the first place. “I hate the term legacy systems, because I used to be a mainframer,” Wasner says. “But you’re looking at something that’s not what people go to school to do. They go to school to get into client server or cloud.”
The scarcity of skills has led FNTS to embark upon the training program, which involves up-skilling employees already with the company. Trying to recruit people from outside the company with existing IBM i skills is a non-starter.
“If you find people now, what you’re finding are people who may not be at retirement age, but getting close,” Wasner says. “You’re not finding the gentleman who comes out of college and is looking to build the career and everything else. Having said that we’ve got a couple people like that because we’ve got them engaged in what we’re doing. But [IBM i and mainframe] is not something you go to college for.”
FNTS was created 20 years ago when it was spun out of First National of Nebraska Inc. (FNNI), a $20 billion financial services firm also based in Omaha. The company had invested in data centers and IT infrastructure, and decided to leverage that investment and its expertise by becoming a hosting provider, what we now widely call an MSP.
FNTS runs several big IBM i boxes, and is looking to buy more. It has a solid partnership with IBM, Wasner says, as well as partnerships with Dell EMC for storage. It also works with Pivotal, an EMC spin-off, as part of its Cloud Foundry program.
Thanks to new cloud business models, the hosting industry is expanding rapidly. One recent estimate pegged the global MSP market growing to a $242 billion business by 2021. While most of the hosting business involves regular X86 platforms, IBM customers are sending a good chunk of CPWs and MIPS upward into private clouds, as well.
FNTS is planning on expanding its cloud business by adding another data center, possibly in the Southwest, Wasner says. The company does not offer a high availability solution for IBM i customers, which could be a possible area for expansion.
It’s also looking to add other services, such as database engineering and performance tuning. That service would include IBM i and its integrated DB2 database, Wasner says.
“If a customer brings in 40 servers, and they have a database server behind them, and we can help them understand that they only need 28 servers and they can shrink the size of the database server–that’s what we’re looking for,” Wasner says. “We want to be a long term business partner, not just somebody who’s in it for the money. We want to make your life better as customer.”