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A fresh wave of digital transformation is coming, with industries across the board impacted by the “second digital revolution”, according to a new report published by analysts at Ovum looking at the digital economy and its key players over the next decade.
All industries will be affected by this revolution. More verticals and processes will be impacted and automated by digitalisation, and these effects will be felt across value chains, supply chains, consumption and monetisation.
Ovum predicts that this equates to a $4,8-trillion global opportunity in 2025 – up 29% from today- for technology companies. These are the Digital Enablers – such as IT vendors like IBM and SAP and Communication Service Providers like AT&T, Orange & Deutsche Telekom, as well as the likes of Google, Apple and Microsoft -who will supply the technology and connectivity making this organisational transformation possible.
But it’s enterprise technology that will take the largest slice of the pie.
There will inevitably be winners and losers, in this transformational shift. Ovum forecasts that it will be the Digital Enablers who become SMART players, who will benefit the most from the evolution of the digital economy.
SMART players are those enabling Services, device and service Management, Applications, customer Relationship, and the underlying Technology platforms through which customers and third parties access and distribute applications and content. Embedded in many digital enablement segments and with significant breadth of reach, they’ll be able to capture a significant proportion of the total value.
Today’s internet platform providers – such as Apple, Google, Facebook, Amazon and Microsoft – are most likely to assume these roles, but new challengers are likely to evolve from the internet or media segments.
Steven Hartley, practice leader: service provider and markets at Ovum, says: “Driven by cost-effective connectivity, greater computing capacity and improvements in technology such as analytics and artificial intelligence, the second wave of the digital revolution is on its way and its impact will be felt across all industries.
“The first digital revolution (1995-2015) impacted key processes and consumer-facing sectors such as media and retail. However, the second will impact a far greater range of processes and industries across the enterprise space, thereby expanding the opportunity to support their transformation – albeit with less direct consumer impact than before.
“Those players providing technology, connectivity and services to the Digital Economy will have a huge opportunity to facilitate this transformation.”
Success for Digital Enablers, defined either by growth into new opportunities or even simply survival, will depend on several capabilities. Chief among these will be prioritising customers and continuous innovation.
Those organisations that win out will be those who work differently:
* Collaborating with competitors, partners, suppliers and any combination of the above;
* Putting the consumer at the heart of their decision making process;
* Consistently innovating; and
* Building scale and reach.
As Steven Hartley explains: “Increased competition, attracted by revenue growth and facilitated by more open ecosystems, will mean that organisations must place the needs of customers at the heart of their decisions and processes. Innovation, partnerships, scale, agility and service bundling will all be vital to support this new outlook on the market.”
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