The GSMAi noted that companies are planning to allocate 9% of their revenue to digital initiatives between 2024 and 2026
Enterprises are increasingly prioritizing cybersecurity and revenue growth over cost-cutting as they accelerate their digital transformation, according to a new report by GSMA Intelligence (GSMAi).
The study, titled “The Rise of Digital Industries: Navigating Enterprise Needs, Investments, and Supplier Decisions,” highlights that 60% of businesses emphasize revenue growth, customer experience and competitive advantage as primary objectives for their digital transformation efforts, rather than cost-saving measures.
The report also noted that investments in digital technologies are expected to rise significantly over the next six years, with companies planning to allocate 9% of their revenue to digital initiatives between 2024 and 2026, increasing to 11% from 2027 to 2030.
The GSMAi report also revealed that 85% of enterprises view 5G networks and connectivity as crucial to their digital transformation, with nearly half identifying it as extremely important. Enterprises are expected to allocate 21% of their digital transformation budgets to connectivity and related devices, 13% to mobile (including 5G), and 8% to fixed and Wi-Fi networks.
The report also highlighted that the features that enterprises value most in 5G are enhanced security (57%) and connectivity (52%). Investment in 5G from 2024 to 2030 is predicted to be 2.5 times higher than in 4G, with a strong focus on sectors requiring high mobility like automotive, transportation, logistics and warehousing.
Artificial intelligence (AI) also plays a prominent role, making up 14% of enterprise technology spending. Enterprises are currently using AI to enhance customer experiences, bolster security and improve employee productivity. Generative AI is becoming a key element in companies’ digital strategies, with 90% adopting it, although only 33% are using it in more advanced applications.
The report also stated that businesses are also advancing in IoT usage, increasingly adopting 5G-enhanced applications. Additionally, enterprises are showing considerable interest in eSIM for IoT, chiefly due to its scalability and security advantages. By 2030, eSIM is expected to comprise 42% of the total IoT cellular market, according to the report.
As companies accelerate their digital transformation, they are turning to a diverse array of suppliers to fulfill their technological requirements. The GSMAi report indicates a preference for generalist suppliers – such as hyperscalers and telecom vendors – that offer nearly complete, end-to-end solutions.
“Enterprises of all sizes are eager to advance their digital transformation and are making the necessary investment. As a result, supplier competition is fierce. Telcos need to go beyond just providing network services since enterprises are increasingly looking for partners who can help them throughout their full digital transformation journeys, combining technologies such as 5G, AI, IoT and cloud to improve efficiency, security and drive revenues,” said Pablo Iacopino, head of research at GSMAi.
“The cost of implementation and complexity of tech integration are the top two deployment challenges faced by enterprises. This means the role of tech orchestrator will become even more important, and demanded in the future, which presents new opportunities for multi-service suppliers,” he added.
