Press "Enter" to skip to content

Metaverse yet to catch fire

Inaugural TD SYNNEX Industry Benchmark Study shows that European businesses are taking advantage of opportunities in services but missing out when it comes to the metaverse

  • Nearly 75% expect to sell more managed services in the next three years
  • Only 17% say they will offer AR/VR solutions in next two years
  • More than 40% plan to offer sustainability/ESG reporting within 24 months

Less than one-fifth of European technology ecosystem business leaders say they will offer augmented and virtual reality (AR/ VR) solutions by 2024, despite an IDC- projected $16 billion European metaverse market and an expected 150% increase in investments in the next 24 months.

This is one of the stand-out findings in the first-ever TD SYNNEX Ecosystem Benchmark Report, which more generally highlights the extent to which IT service providers have fully embraced the managed services trend, with almost three-quarters of respondents anticipating increased revenue from this arena.

Patrick Zammit, President, Europe and Asia Pacific Japan, TD SYNNEX, said: “As a global IT distributor and solutions aggregator TD SYNNEX has a unique vantage point from the centre of an evolving technology ecosystem. The TD SYNNEX Technology Ecosystem Benchmark Report captures how the IT channel is anticipating and responding to innovations that are transforming the way we interact and consume. By harnessing the potential of emerging trends, the channel will be well positioned to help accelerate the adoption of new technologies that will deliver exponential advances in efficiency, connectivity and safety.”

Conducted in collaboration with technology market analyst firm Canalys, the report highlights how the rapid rate of change has evolved into a state of relentless transformation, with every business connected in the global technology ecosystem.

The report is based on an industry survey of mid-size technology ecosystem partners, which Canalys defines as technology companies with 1,000 seats and under. Respondents in Europe identified three fundamental requirements influencing their businesses:

  • Anticipating and meeting end-user technology expectations;
  • Effectively managing technology ecosystem business operations; and
  • Technology ecosystem engagement, enrichment and enablement.

Despite these challenges, 82% of European partners expect to report growth this fiscal year, with 43% identifying security, servers and storage as their top revenue drivers. For 40%, they are also the most profitable technologies, with security topping the list.

Services are the new black

Services Type

Percent of partners indicating an increase

Managed Services

74 percent

Professional Services

65 percent

Consumption-based XaaS

50 percent

Packaged Services

44 percent

Product Lifecycle Services

38 percent

Services are the big engine of growth, with growth predicted in every category (see table). However, hardware remains a key part of respondents’ offerings.

Most European partners (63%) say hardware resale will continue to be fundamental to their business mix, with 25% expecting the category to grow and 38% expecting no change.

More than one third of respondents say selling their own IP, which currently represents 4% of their business, will grow in the next 24 months.

Rachel Brindley, Senior Director, Channels at Canalys, said: “Channel partners are actively developing their services businesses. We see that partners are looking to invest across the technology ecosystem.”

ESG growing in importance

IT business leaders know they need to grow capabilities around sustainability and ESG (environmental, social and governance), with 43% of European partners planning to offer sustainability reporting within the next two years.

The report states: “Partners equipped to help customers meet ESG commitments and requirements will have an outsized opportunity in the market.”

Zammit said: “We’re really encouraged to see European technology leaders put ESG capabilities on their roadmap. It’s an important priority for TD SYNNEX, too. We’re proud to have signed the Science Based Targets Initiative, committed to net-zero carbon emissions and created a global DEI strategy.”

In line with TD SYNNEX’s commitment to being a good corporate citizen, the company recently launched a sustainability certification to help TD SYNNEX customers and co-workers accelerate their aptitude in this increasingly important business function.

Collaboration and engagement a priority

European IT partners signal that collaboration is a high-priority growth strategy. More than three quarters (79%) of respondents ranked engaging ecosystem partners as important or very important to future growth.

Andy Gass, Chief Digital Officer, TD SYNNEX, said: “Delivering value to end- user customers means evolving business capabilities that scale to the most efficient and effective ways to source, configure, provision, secure, manage and service those technologies. In an environment of continued rapid technological change, European IT businesses need to bring solutions to market faster. Ecosystem collaboration accelerates that time to market, reduces costs and minimises technology skills gaps.”

An executive summary of the European Insights from the TD SYNNEX Technology Ecosystem Benchmark Report is available from https://explore.techdata.com/tdsynnex-canalys-report.html.

Please follow and like us:

Be First to Comment

Leave a Reply

Technology Reseller Magazine & Site is Published by Kingswood Media 2022