IBM's $40B stock wipeout is built on a misconception: Translating COBOL isn't the same as modernizing it
VentureBeat • • business
Key Points:
- Anthropic released tools enabling its AI Claude to read, analyze, and translate legacy COBOL code into modern languages like Java and Python, prompting a $40 billion drop in IBM's market cap due to fears over its mainframe business.
- Despite the market reaction, experts emphasize that the challenge in modernizing COBOL is not technical but financial, as the high costs and low ROI have long hindered large-scale migration from IBM mainframes.
- IBM highlights that COBOL translation is only part of modernization; the more complex issues involve redesigning data architecture, ensuring transaction integrity, and maintaining hardware-software integration built over decades.
- Anthropic's Claude Code is particularly useful for enterprises running COBOL on distributed systems outside mainframes, while IBM's
