Europe Mainframe Modernization Services Market Size and Forecast (2021 - 2031), Regional Share, Trend, and Growth Opportunity Analysis Report Coverage: By Services (Application Modernization, Cloud Migration, and Data Modernization), Enterprise Size (Larg

The Europe mainframe modernization services market is projected to grow significantly, reaching approximately US$ 25,691.86 million by 2031, up from US$ 9,540.45 million in 2023. This growth represents a compound annual growth rate (CAGR) of 13.2% from 2023 to 2031.

Executive Summary and Market Analysis

The European IT management as a service market is divided into several key regions, including Germany, France, Russia, the UK, Italy, and the Rest of Europe. The continent is experiencing a surge in digitalization across various sectors, particularly in banking, financial services, and insurance (BFSI). Major banking institutions in Europe are actively pursuing digital transformation strategies aimed at enhancing customer experience and providing round-the-clock digital services. The European Union (EU) has set ambitious digitalization goals for 2030, including ensuring that over 90% of small and medium-sized enterprises (SMEs) achieve at least a basic level of digital intensity and that 75% of EU companies utilize cloud computing services. Furthermore, the EU aims for large-scale data analysis to be conducted using artificial intelligence (AI) by 2030. As of 2023, over 70% of EU companies have reached a basic level of digital intensity, with SMEs at 69% and large enterprises at 98%.

Despite this progress, many European organizations, especially in the banking, insurance, and government sectors, continue to rely on legacy mainframe systems that have been in place for decades. This dependency, combined with the pressing need to adapt to modern business demands, is driving the demand for mainframe modernization services across various industries, which is expected to fuel market growth from 2023 to 2031.

Strategic Insights

Market Segmentation Analysis

The Europe mainframe modernization services market can be segmented based on services, enterprise size, and end-use industry.

1. Services: The market is categorized into application modernization, cloud migration, and data modernization. In 2023, the application modernization segment held the largest market share, reflecting the critical need for organizations to update their applications to meet current technological standards.
2. Enterprise Size: The market is divided into large enterprises and SMEs. In 2023, large enterprises dominated the market, indicating that larger organizations are more likely to invest in modernization services due to their extensive legacy systems and greater resources.
3. End-Use Industry: The market is further segmented into IT and telecom, BFSI, healthcare, manufacturing, retail, education, and others. The IT and telecom sector accounted for the largest share in 2023, driven by the rapid integration of emerging technologies such as the Internet of Things (IoT), automation, machine learning, and AI.

Market Outlook

The IT and telecom sector has seen substantial growth due to the adoption of advanced technologies. Companies are increasingly prioritizing mainframe modernization services to ensure efficient system operations. These services facilitate the migration of mainframe applications to cloud environments using modern methodologies such as APIs, microservices, and DevOps practices. Mainframe systems, which consist of high-performance hardware and extensive software applications, require modernization to operate efficiently in today’s fast-paced digital landscape.

The growing adoption of advanced technologies across various sectors, including banking, healthcare, government, and transportation, is expected to further drive the demand for IT infrastructure transformation and mainframe modernization services. A recent survey by Kyndryl in September 2024 revealed that 86% of business and IT leaders are engaged in adopting AI to accelerate their mainframe modernization initiatives. Additionally, a Red Hat survey indicated that 95% of IT decision-makers believe application modernization is crucial for their organizations' success, with 75% having completed at least small-scale modernization projects.

Country Insights

The Europe mainframe modernization services market includes key countries such as the UK, Germany, France, Italy, Russia, and others. The UK held the largest market share in 2023, reflecting its advanced technological landscape and high demand for modernization services.

As businesses increasingly rely on technology to enhance operations, optimize service delivery, and improve customer experiences, the demand for mainframe modernization services has surged. The integration of cloud computing and hybrid cloud environments has led to a rise in interconnected systems, applications, and devices, necessitating effective management of these complex IT resources.

Company Profiles

Key players in the Europe mainframe modernization services market include Accenture Plc, Capgemini SE, Infosys Ltd, Fujitsu Ltd, Cognizant Technology Solutions Corp, Microsoft Corp, Mphasis Ltd, Innova Solutions, DXC Technology Co, Amazon Web Services Inc, International Business Machines Corp, HCL Technologies Ltd, Atos SE, Tata Consultancy Services Ltd, Oracle Corp, EPAM Systems Inc, Ensono, LLC, Hexaware Technologies Ltd, Software AG, and Kyndryl Holdings Inc, among others. These companies are employing various strategies, including expansion, product innovation, and mergers and acquisitions, to enhance their offerings and increase market share. Show more