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IBM Partner Growth: The Real Story Behind FalconStor's Momentum
FalconStor launches Habanero hybrid cloud object storage, reports 15% partner growth, and leverages watsonx AI in a determined effort to dominate IBM Power data protection and recurring revenue.
12/10/2025
Key Highlights
- FalconStor achieved a 15 percent increase in its active worldwide partner ecosystem in 2025, reflecting deeper alignment with IBM-focused MSPs.
- The company introduced Habanero, a hybrid cloud object storage solution designed specifically for IBM Cloud Object Storage and Power workloads.
- More than 75 percent of FalconStor’s total revenue is now recurring, indicating a successful business model transition.
- The firm now protects over 3,700 petabytes of mission-critical IBM i data across more than 900 global customers.
- The announcement solidifies FalconStor’s strategy to be the specialized data protection leader for the IBM Power and PowerVS cloud environment.
The News
FalconStor announced strong 2025 momentum driven by significant growth within the IBM partner ecosystem and a major new strategic agreement with a global technology services company. This news included the introduction of a new hybrid cloud object storage service named Habanero. The offerings aim to deliver critical data protection and disaster recovery solutions as IBM Power customers modernize their complex, mission-critical workloads across hybrid environments. The firm also highlighted its successful multi-year shift to a recurring revenue model. Find out more by clicking here to read the press release
Analyst Take
When we look at the trajectory of FalconStor we see a company that is executing with clinical precision against a highly focused vertical strategy. For years, the conventional wisdom in data protection has been to chase the broad, heterogeneous enterprise market, yet FalconStor has doubled down exclusively on the IBM Power ecosystem, specifically IBM i, AIX, and Linux running on Power Systems and the PowerVS cloud. This narrow focus is actually proving to be a stroke of brilliance in a fragmented data landscape where specialization drives value.
The core narrative here is the modernization of systems of record. IBM Power platforms, particularly IBM i, run many of the global economy’s most critical back-end processes, but often rely on decades-old backup technologies like physical tape or legacy VTL solutions that are ill-equipped for ransomware defense and hybrid cloud mobility. The data is vital. The platforms are complex. FalconStor's momentum suggests their dedicated focus is resonating precisely because they understand the intricacies of IBM backup mechanisms like BRMS. They are not trying to be everything to everyone; they are trying to be everything to the IBM Power customer. That is a substantial difference.
Habanero strengthens this position by introducing a Power-native execution model inside PowerVS, eliminating many of the cross-platform inefficiencies that hinder recovery for IBM i and AIX workloads. By operating directly within the PowerVS fabric, Habanero gives organizations a more predictable and operationally aligned path to cloud-based DR, which is a critical requirement for mission-critical Power environments.
The reported 15 percent year-over-year growth in active partners and the new strategic agreement with an unnamed global technology services company are more impactful than a simple sales increase. In this space, the partner ecosystem is the delivery vehicle for modernization services. A major global services provider agreeing to integrate FalconStor’s solutions into their managed services and hybrid cloud migration projects signals market acceptance and scalability. This is how specialist software companies achieve global reach without massive internal sales investments. It shifts the burden of technical complexity and implementation to trusted, large-scale systems integrators, which is a key requirement for risk-averse, regulated organizations that characterize the IBM Power customer base. The model is working. Their recurring revenue stream, now comprising over 75 percent of total revenue, provides the financial predictability necessary for sustained investment in this specialized area, which is commendable given the difficulty software companies face transitioning away from perpetual licensing.
What was Announced
The central product innovation is the introduction of Habanero, a new hybrid cloud object storage offering. For more information, check our recent conversation with Todd Brooks, the CEO of FalconStor.
Habanero is architected to address the increasing need for secure, scalable, and cost-effective long-term data retention and disaster recovery directly within the IBM cloud environment. Specifically, the service is built on the global IBM Cloud infrastructure and is tightly integrated with IBM Cloud Object Storage, or IBM COS. This integration aims to deliver a seamless, cloud-native pathway for IBM partners to implement data protection, archiving, and disaster recovery solutions for their Power clients.
Habanero is designed to allow customers to leverage the cost advantages and scalability of object storage for data that originates from their on-premises IBM Power Systems or PowerVS instances. Key capabilities include the ability to serve as a cloud-based target for data movement and retention, ensuring that the mission-critical data remains protected and compliant outside of the primary production environment. Being featured in the IBM Cloud Catalog simplifies procurement and deployment for IBM Business Partners.
Beyond the product, FalconStor is extending its partner enablement with the increasing adoption of Thomas. Thomas is a multilingual, watsonx-powered technical reference resource. This AI assistant is designed to provide deep expertise across FalconStor platforms, IBM Power modernization patterns, and hybrid cloud best practices. By leveraging watsonx, Thomas aims to simplify complex technical queries and maintenance support for IBM Business Partners, accelerating their ability to deliver complex projects like hybrid cloud migrations. This investment in AI support shows a clear understanding that complexity is a sales blocker and that scalable partner support is paramount to future growth. This is a crucial delivery mechanism.
Our perspective is that this is not just product news, but a refinement of their long-term IBM-centric platform strategy. They are layering cloud-native object storage capabilities (Habanero) on top of their proven VTL and deduplication solutions (StorSafe). This combination gives customers the non-disruptive, virtualized backup experience they need on-premises, coupled with a cost-optimized, immutable, and cloud-resident target for archiving and disaster recovery using IBM COS. This dual approach respects the operational inertia of IBM i shops while providing a clear runway to hybrid cloud resilience. You cannot force a Power customer to change everything overnight; you must provide a bridge.
Looking Ahead
Based on what we are observing, FalconStor's specialized strategy within the IBM ecosystem is paying dividends, evidenced by its partner growth and financial transition. The market trend that we are going to be looking out for is the competitive response to this deep specialization. While broad platform providers like Commvault, Veeam, or Cohesity offer data protection across heterogeneous environments, they often treat IBM Power as a secondary workload, or require complex third-party orchestration. FalconStor owns this niche.
The announcement of Habanero is a necessary evolution. Hybrid cloud protection for critical data has become table stakes, especially since IBM's own 2025 breach reports highlight how cross-environment data exposure leads to the costliest incidents. Habanero’s tight integration with IBM COS, certified and listed in the IBM Cloud Catalog, eliminates much of the integration friction that plagues multi-cloud backup projects. This places Habanero in a fundamentally different category from traditional object storage vendors, providing a Power-aligned recovery layer rather than a generic, infrastructure-agnostic bucket. They have minimized the technical adoption barrier.
We are going to be closely monitoring how the company performs on MSP consumption model adoption in future quarters. The undisclosed strategic agreement with the global technology services company, spanning both resale and managed service consumption, is the real catalyst. If this agreement translates into significant volumes of new PowerVS-based Backup-as-a-Service (BaaS) revenue, it validates the company’s entire recurring revenue pivot and solidifies their position as the default solution for IBM Power cloud resilience. This shift from one-time VTL sales to consumption-based services delivered by MSPs is a tectonic shift for a company of this size. HyperFRAME will be tracking how the company does on cloud-native ARR growth, specifically where Habanero volume contributes meaningfully. That metric demonstrates true cloud penetration. Their success hinges on whether the tight IBM alignment can repel the generalist data protection players who are inevitably moving upmarket. Specialization is their shield and their sword.
Don Gentile | Analyst-in-Residence -- Storage & Data Resiliency
Don Gentile brings three decades of experience turning complex enterprise technologies into clear, differentiated narratives that drive competitive relevance and market leadership. He has helped shape iconic infrastructure platforms including IBM z16 and z17 mainframes, HPE ProLiant servers, and HPE GreenLake — guiding strategies that connect technology innovation with customer needs and fast-moving market dynamics.
His current focus spans flash storage, storage area networking, hyperconverged infrastructure (HCI), software-defined storage (SDS), hybrid cloud storage, Ceph/open source, cyber resiliency, and emerging models for integrating AI workloads across storage and compute. By applying deep knowledge of infrastructure technologies with proven skills in positioning, content strategy, and thought leadership, Don helps vendors sharpen their story, differentiate their offerings, and achieve stronger competitive standing across business, media, and technical audiences.
Steven Dickens | CEO HyperFRAME Research
Regarded as a luminary at the intersection of technology and business transformation, Steven Dickens is the CEO and Principal Analyst at HyperFRAME Research.
Ranked consistently among the Top 10 Analysts by AR Insights and a contributor to Forbes, Steven's expert perspectives are sought after by tier one media outlets such as The Wall Street Journal and CNBC, and he is a regular on TV networks including the Schwab Network and Bloomberg.