The U.S. economy shows continued strength as retail sales rose by 0.4% in September, following a 0.1% increase in August—this data, described as better-than-expected, counters previous concerns of an economic slowdown. Notably, categories such as clothing shops, restaurants, and food shops all experienced spending increases, while pet stores saw the largest surge at 4%. In contrast, furniture and electronics stores reported declines of 1.4% and 3.3%, respectively.
Kyndryl’s 2024 Readiness Report reveals a striking paradox: while 90% of executives believe their IT infrastructure is top-notch, only 39% feel it’s prepared for future challenges. While 94% of leaders prioritize technology modernization, Kyndryl notes that 44% of critical IT infrastructure is nearing or at the end of its lifecycle, posing significant risks.
A recent study by Cisco reveals that IT partners worldwide expect a significant shift in revenue towards AI technologies over the next four to five years. According to a recent survey by the International Data Corporation, 70% of IT leaders report that AI has improved their data processing capabilities. The integration of AI tools is streamlining operations and enabling better decision-making through enhanced data insights. As businesses increasingly rely on data-driven strategies, the adoption of AI in data management is becoming crucial for maintaining a competitive edge in the industry.
In 2024, 40% of small businesses in the United States are utilizing artificial intelligence tools, a significant increase from 23% in 2023, according to recent research by the US Chamber of Commerce. The primary applications of AI among these businesses include marketing, gathering customer insights, and enhancing communication with customers. The most popular AI-enabled tools being adopted are search engines, social media platforms, email services, and financial management software.
The artificial intelligence market is now valued at approximately $9 trillion, with enterprises just beginning to explore its potential, according to a recent State of AI Report co-authored by AI investor Nathan Benaich and Air Street Capital’s Alex Chalmers. Key predictions for the coming year include the viral success of no-code apps, significant changes to data collection practices by frontier labs, and the continued dominance of Nvidia in the AI chip market. The report also highlights that traditional robotic process automation is set for an AI-driven upgrade, with innovative approaches like JP Morgan’s FlowMind achieving 99.5% accuracy in workflow understanding.
ServiceNow’s senior vice president of global partnerships, Erica Volini, highlighted how mid-sized managed service providers, or MSPs, leverage generative artificial intelligence tools like Now Assist to carve out niche markets. While larger MSPs target massive enterprise contracts, these mid-market players focus on specific verticals such as healthcare, finance, and manufacturing, allowing them to thrive despite their smaller scale. Volini emphasized the importance of specialization, relationship-building, and agility in responding to market changes, that pricing pressures are mounting, and MSPs need to demonstrate their value through integrated services and consulting.
A recent survey conducted by CDW of 962 IT decision-makers reveals that organizations increasingly rely on internal and external expertise to manage their cloud services. The survey found that 88 percent of respondents feel they can effectively manage their cloud environments, with half stating they do so “very effectively.” However, key challenges persist, including a lack of governance or cloud strategy cited by 63 percent and a lack of cloud skills by 61 percent. The demand for cloud expertise remains steady, with over three-quarters of respondents planning to migrate at least 25 percent of their remaining on-premises applications to the public cloud within the next three years. The benefits of cloud technology are recognized, with 74 percent of respondents reporting that the cloud’s advantages have met or exceeded their expectations.
The consistent themes across these reports are modernization, AI adoption, and specialization. The retail resilience is a signal for IT services to target growth areas like food services and customer-focused tech. Kyndryl’s findings on infrastructure readiness highlight ongoing vulnerabilities in legacy tech—an opportunity to push lifecycle management and future-proofing as key offerings. Meanwhile, rising AI adoption, especially among smaller businesses, opens the door to refine affordable, easy-to-deploy AI solutions. For MSPs, the lesson is to avoid competing head-on with large players; rather, hone a vertical focus where they can uniquely add value.
Across all these trends, the demand for expertise—whether in AI, modernization, or cloud—is clear. Service providers that can offer strategic advisory along with execution will have an edge, particularly as organizations grapple with both opportunity and risk in their tech stacks.