The legacy software works very well in a static world: when nothing ever changes there is no need to update the software. Of course, this is not the case. The

The legacy software works very well in a static world: when nothing ever changes there is no need to update the software. Of course, this is not the case. The problems arise when the software updates are not budgeted. Especially the finance sector is notorious for underinvesting in R&D and instead of spending money on stock buybacks - stockholders appreciate. However this cycle is broken when the world actually changes. If there is no proper maintenance, usually in the form of software R&D, the legacy software change cost has gone prohibitive high and the parent company is unable to do anything. This change is often Schumpeter's creative destruction. There is a new technology. A new startup raises as a competitor, using more efficient software where they can do changes, and execute their core business, with much lower cost, outpacing the established competitors. Some industrial, like early mentioned finance, are however very-well protected due to barries of entry like the cost of initial capital and regulation. Thus, you are going to see more legacy software in industries where there is never need for a change.