The rise of generative AI, the hosting of the COP28 conference, and a world still trying to figure out how to do more with less. These are just some highlights from 2023. Now we must look to the future. What are the opportunities ahead? And how do business leaders and other decision makers take advantage of those opportunities to build efficient, profitable, sustainable operations?
The world is changing, and business must change with it. Technology can and must support that change. I offer four predictions for the coming new year that should prepare IT and business decision makers for the challenges they will face.
Prediction 1 — Demand for generative AI solutions will spark a new surge in container adoption
A recent study by McKinsey predicted that US$150 billion (or 9% of combined GDP) of value could be added to GCC economies by artificial intelligence, but went on to state “that figure could be quickly surpassed” by the adoption of technologies like generative AI. Next year, we can expect to see the widespread adoption of containers — already a growth market — to facilitate generative AI’s integration.
The open-source Kubernetes, and containers in general, are widely seen as the best way to achieve the required agility to adopt AI at an organisation’s own pace. Containers play vital roles in the curation, cleaning, and formatting of data, as well as in model training, largely because the tools used in these stages all reside in containers.
This will be the third phase of growth for containers, the first being the containerization of workloads and the second involving databases and applications. Now that AI and its supporting tools are migrating, we will see the reliance on containers continue to rise, through 2024 and beyond.
Prediction 2 — New regulation will impact technology purchasing in 2024
Regulatory compliance will continue to be a priority in 2024. Following COP28, there will be renewed focus on initiatives such as Dubai’s Green Building Regulations and UAE Net Zero by 2050, led by the Ministry of Climate Change and Environment (MOCCAE). And the ongoing surge in cyber incidents, exacerbated by the rise of generative AI, will see organisations once again consulting guidelines such as the UAE Information Assurance Regulation.
ICT resilience and sustainability are both indivisible from technology. Digital solutions can help with the reporting of Scope 1, 2, and 3 emissions, including the capture of information from along the supply chain. For cybersecurity, enterprises must look to a range of issues, from identity and access management (IAM) to the protection of endpoints within a hybrid work environment. Banks, telcos, and utilities must also deal with the threat to critical infrastructure posed by the merging of IT and OT.
All these issues will affect the decisions made regarding technology purchases. Procurement teams must allow for their organisation’s obligations to minimise waste, protect data, and a range of others. These decisions not only affect a business’s internal IT suite, but the products and services they provide. And strong reputations in cyber resilience and sustainability will bring competitive advantage in the years ahead.
Prediction 3 — Energy consumption and power costs will accelerate the shift from CapEx to OpEx
Continued concerns about the state of the economy, difficult business conditions and high energy costs will have a significant influence on the tech market in 2024. This will accelerate the trend towards OpEx spending over CapEx.
Subscription services will continue to be very attractive as customers only want to pay for what they use, scale up and down as needed and, avoid the need for large CapEx outlays. Besides direct budget constraints, we’ll continue to see subscriptions growth being driven in part by uncertainty about the full utilisation of new assets.
It makes sense to opt for a subscription to a service and avoid CapEx expenditure when there’s a reasonable possibility that a CapEx asset will not be used to full capacity. However, subscription services will only succeed if they are backed by relevant SLAs. With so many subscriptions available on the market, buyers are becoming more discerning about what to invest in, and are demanding SLAs which guarantee crucial areas of the service including data protection and energy efficiency/sustainability.
This trend is also being observed in data centres, with operators beginning to favour on-demand models that enable just-in-time provisioning of assets. This allows them to better control energy costs through lower power consumption, which also helps them realise their sustainability goals. From a sustainability point of view, platform usage in data centres over a three to five year period is going to be the biggest factor in carbon emissions. Organisations are becoming aware of this and factoring it into their purchasing decisions for the year ahead and beyond.
Prediction 4 — Demand for greater efficiency and innovation in data centres to grow as capacity crunch hits
Many organisations that are reliant on data centres are reporting that their most pressing issue right now is one of capacity. A growing number of data centres are full, and don’t have the space or power available to deploy new platforms.
In 2024, this will result in widespread efforts to achieve efficiency gains, even on existing data centre platforms, as this is the only way they will be able to reclaim space and power to accommodate the use of new technologies inside the data centre.
To optimise the sustainability of existing data centre footprints, we’ll see operators looking to switch to new, more power efficient technology, with smaller space and cooling requirements. This is in essence extending the life of the data centre — an essential factor when considering the need for new technologies in the wake of the rise of AI.
The UAE has always been a thriving business community. It faces down challenges and turns them into opportunities. In 2024, businesses that align with the needs to optimise every asset, build sustainable operations, protect data and systems, and make use of new tools like generative AI will emerge as leaders.