Next in tech trends: Thriving with data, AI and agility

PricewaterhouseCoopers

Next in tech 2025: Thriving amid disruption with data, AI and

agility
Tech innovation meets operational efficiency to drive growth –– and compliance

As technological disruption continues, and regulators scramble to keep pace, the tech sector may encounter some
challenges in 2025. However, it’s also well-positioned to meet this moment as an opportunity for reinvention.
Generative AI (GenAI) is enabling new content creation and automating complex tasks, offering companies the
ability to enhance productivity. The Internet of Things (IoT) is increasingly essential in smart homes and factories
alike –– driving efficiency and real-time data insights. Meanwhile, the semiconductor industry remains critical,
underpinning advancements in AI, IoT and other tech innovations that are fundamentally changing how businesses
operate and deliver value. While these innovations offer immense potential, they also come with complexity,
requiring tech leaders to rethink their business models and delivery strategies.

Reinventing how you operate isn’t just about adapting to disruption — it’s about thriving in a dynamic era of
constantly evolving competitive players and customer expectations. The winners will likely be those who successfully
navigate rapid decision-making cycles in areas like AI investment and adopt new technologies, such as AI agents, as
soon as they become commercially viable.

Increasingly complex regulatory frameworks, geopolitical risks and cyber threats abound. Tech companies that rise
to the occasion can reap significant rewards for their big bets. Strategic investments in leading technology and
operational efficiencies can drive higher returns while transforming customer experiences. Business model
reinvention (BMR) will play a critical role in unlocking these opportunities. Data optimization, operational
restructuring and managed services offer pathways to reduce costs and improve productivity, but these must be
pursued alongside a keen understanding of regulatory changes –– and global and domestic political shifts.

Let’s unpack the big trends we see influencing the sector in the coming year. Are you ready to continue shaping the
world, lead through disruption and capture the opportunities 2025 presents?

Pivotal trends in 2025 fall into these main categories:

Business model reinvention

Data organization and operational efficiencies
Regulatory and geopolitical challenges

Business model reinvention: Seizing growth opportunities

In 2025, business model reinvention will be a pivotal trend for the tech sector, driven by advancements in GenAI,
IoT and semiconductors that can reshape operational models and unlock new value streams. While the sector is
optimistic about scaling these innovations, your organization will have to carefully navigate challenges such as data
monetization, AI risk and governance, and strategic partnerships to more fully realize the potential of these emerging
technologies..

GenAI, IoT and semiconductor innovations present unique opportunities to reshape operational delivery models. By
integrating these technologies, tech businesses can unlock new value streams, improve efficiencies and gain a
competitive edge. We’re seeing exciting innovations throughout the sector from creating smart venues that provide
sports fans with personalized experiences to creating virtual worlds for gamers and manufacturers alike. The sector
is leading the charge with 85% of TMT executives agreeing they have the capabilities to execute business models at
scale –– and 76% plan to use GenAI to ramp up those efforts. Still, while business model reinvention can open new
doors, it also presents challenges. You’ll have to balance innovation with trust-building –– emphasizing responsible
AI and transparent data practices will be essential.

While accessing and leveraging data is now an important value driver, 46% of TMT companies find data
monetization a major challenge. M&A could enhance these capabilities and help support –– and accelerate ––
business model reinvention. In the current climate, this is likely to be a good bet. Tech deal activity picked up in
2024, buoyed by early-year megadeals, inflation reductions and AI-driven investments. But election-year uncertainty
and intensified regulatory scrutiny by the DOJ and FTC reshaped deal dynamics, underscoring the importance of
strategic structuring and innovation in the evolving market.

Strategic partnerships, including alliances with key players in the ecosystem, can boost data-driven growth by
providing access to new technologies and markets. PwC’s analysis found that tech, media and telecom ecosystem-
driven companies achieve 50% to 60% margins, compared to 30% to 35% for traditional product-led firms,
highlighting the profit potential for businesses willing to invest in ecosystems and take on associated risks. In the
post-election climate, we’ll see how the sector pivots with these moves, as 84% of TMT executives said election
results would affect their company’s strategic business partnerships, more than any other industry we surveyed, and
75% said results would affect their acquisition and divestiture decisions.

For new companies, speed to value is especially critical. Startups that embrace agile frameworks are poised to rapidly
scale operations. The key takeaways for new entrants: Integrate AI early, refine through internal testing and scale
smartly.

Data organization and operational efficiencies: Enhancing

productivity and cutting costs
In 2025, trends in data and operations will reshape the tech sector as companies focus on leveraging GenAI, cloud
adoption and managed services to enhance efficiency, reduce costs and optimize supply chains.

Operational efficiency is a key driver of success for tech companies and the broader TMT space. These leaders have
their work cut out for them. But they’re taking active steps to enhance resilience and risk management capabilities
while reconfiguring existing technologies and restructuring supply chain networks. And they’re doing all this while
also focusing on cost management and reduction. GenAI shows some promise in this area, with 45% of tech and telco
leaders expecting GenAI to achieve more savings in the coming months. Some of these savings may come in the form
of new outsourcing trends as GenAI, and specifically AI agents, can take on more tasks, help reduce costs and get
work done more efficiently. This technology may also impact global delivery models, reducing the time to deploy and
size requirements.

According to our most recent Cloud and AI Business Survey, when it comes to overall operations, 61% of tech
companies report GenAI adoption in a few or many areas of their business. This emerging technology can
supercharge data-driven solutions to enhance productivity and optimize costs. A key part of AI-centric
transformation is going all in on cloud adoption. Although only 27% of the tech companies we surveyed take an all-in
approach here, we expect this to increase over time, as leaders make cloud a significant portion of their IT budget. In
fact, 84% of all TMT companies indicate they’re increasing their cloud budgets in the next planning cycle, with
GenAI identified as the leading driver for budget increases. They’re also already seeing –– and expecting ––
measurable value from cloud when it comes to improving time to market, improving resilience, increasing
productivity and accelerating AI capabilities.

The AI models that can accelerate your business need to be fed the right data. TMT executives know this, and 80%
have already modernized or plan to modernize their data within the next 12 months so they can further take
advantage of the power of GenAI. As you look to configure better ways to store, manage and access your data –– and
adopt advanced analytics tools –– you gain the ability to make more informed, strategic decisions, improving overall
business outcomes.

Another trend we’re seeing is a shift toward managed services. This can help you reduce overhead and improve
flexibility in responding to market conditions. Engineering as a Service (EaaS) models, combined with managed
services, can significantly reduce time-to-market for new product development. This approach allows companies to
streamline processes and focus on core competencies while outsourcing nonessential functions. We’ll soon see how
AI affects this trend in terms of streamlining a transition to managed services –– as well as potentially reducing the
costs. Data and analytics offer valuable insights into optimizing operations, especially when integrated through
alliances. By using cloud-based systems and ERP (enterprise resource planning) implementations, businesses can
better manage resources, drive efficiencies and scale more effectively.

Regulatory and geopolitical challenges: Navigating a complex

landscape
Ongoing regulatory and geopolitical trends present both risks and opportunities for tech companies in the coming
year.

The tech sector is experiencing one of the most significant transformations in history as global digital regulations
reshape the landscape at an unprecedented pace. Amid the explosive growth of data, intensifying scrutiny of artificial
intelligence and rapid technological evolution, new regulations are setting standards for data use and access,
transparency, content responsibility and competitive fairness. This shift is about much more than compliance. It’s an
opportunity to build resilience, redefine market position and earn consumer trust.

In the United States, regulatory focus on national security and cybersecurity is intensifying as digital threats grow
more sophisticated: 81% of TMT executives report that cyberattacks remain a top business risk — an issue set to
deepen as advances in quantum computing threaten current cryptographic methods.

Geopolitical tensions are intensifying risk, and US-China tensions continue to impact international business
strategies. The US “Rip and Replace” program mandates the removal of certain Chinese telecommunications
equipment from critical infrastructure, underscoring regulatory pressures on supply chain security. Additionally, a
new Department of the Treasury rule restricts US investments in China’s semiconductor, quantum and AI sectors,
adding another layer of scrutiny.

Tech executives are also closely tracking trade policies, and 81% of TMT leaders say these policies are a top concern
for decision-making, particularly around supply chains, sourcing and sales. President-elect Donald Trump has
signaled he plans major tariff hikes on China and Mexico, targeting vehicles and key goods, while imports from other
countries face 10% to 20% tariffs — raising costs and adding uncertainty for companies with Mexican manufacturing.
Stay alert to evolving trade policies and increasing regulatory oversight, especially as bipartisan scrutiny of Big Tech
continues to grow –– including for antitrust considerations. Climate regulations add complexity to this landscape,
with stricter emissions standards and reporting requirements. The recent Chevron ruling introduced more regulatory
uncertainty, potentially impacting climate-related policies. Focus on prioritizing compliance, sustainability and
proactive risk management to handle shifting complexities while continuing to drive innovation. Agility will be
essential as you evolve your future-forward strategies.

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