Technology Sector Outlook for 2023 According to Dynabook

Written by Alexander Malienko, Business Unit Director Middle East and Africa, Dynabook Europe GmbH

Given the ongoing complications following the pandemic, the economic effects of the Russian invasion of Ukraine, and challenges linked to rising energy prices, predicting what the future holds in 2023 is anything but a simple task. However, it is indisputable that the MENA region and, in particular the richer Gulf states, is undergoing a region-wide digital paradigm shift, with a concerted push for economic diversification away from oil and gas production exports driving technological disruption.

This was highlighted in the key themes of the LEAP22 conference in Riyadh at the beginning of 2022, where trends such as massive digital transformation investments, citizen-focused e-government services, multi-cloud strategies, forays into the metaverse, and more have indicated a dynamic digital future in the GCC. Just as important, the Smart City Expo Doha in March 2022 showcased solutions for creating a more sustainable and prosperous future for cities and citizens.

To meet the demands of the digital transformation that is occurring in the region, organizations are maintaining increased spending on critical technologies such as 5G, Internet of Things (IoT), Cloud Computing, Data and Analytics, AI and Machine Learning, Augmented Reality (AR) and Virtual Reality (VR) and Cybersecurity.

Also evident is the boost in investment in eLearning, driven by a lack of digital talent in the region. Expected to grow by $492.66 million between 2020 and 2024, the eLearning market is bridging the gap by providing skill-based training, as well as upskilling the native workforce in order to minimise the dependence on an expatriate workforce, as well as reducing educational inequality.

5G
Saudi Arabia, UAE, Bahrain, and Qatar have made huge investments in 5G mobile networks in recent years, with the objective to improve customer services, automate operations in the oil and gas, healthcare, and automotive industries, and enable smart, connected cities.

Internet of Things (IoT)
The implementation of IoT technologies in the retail sector., leveraging sensors and beacons to personalize the shopping experience for consumers through smartphones.

Cloud Computing
While security concerns kept many companies wary of migrating infrastructure and applications to the cloud, those have been largely overcome.  According to Arabian Reseller, 77 percent of CIOs in the UAE claim that they are investing in cloud technology, while 44 percent claim that they are doing so aggressively.

Big Data Analytics
Another technology is being heavily leveraged in the retail and eCommerce sector.

AI and Machine Learning
One of the biggest technology trends in the Gulf, particularly in the UAE and Saudi Arabia, with the public sector services being made a great deal more efficient through automating routine tasks associated with licensing and registration, tax filings, and so on. According to a report by the consultancy Oliver Wyman, the GCC could save $7 billion per year by automating routine tasks

Augmented Reality (AR) and Virtual Reality (VR)
Adoption is seen predominantly in the healthcare and real estate sectors, enabling virtual doctor visits, chatbots, and virtual tours of properties.

Cybersecurity
The aggressive push for digital transformation consequently increases the need to implement measures to protect against cyber threats, with the creation of dedicated cybersecurity organizations to prepare for potential breaches, and Governments developing national cybersecurity strategies.  However, while large organisations strive towards increasing their security measures, our research revealed that only 46% of SMBs in EMEA regard improving their cyber security infrastructure as an investment priority for the next 12 months.

This leaves a large percentage of businesses not focusing their efforts on security and shows not enough is being done across the industry to prevent cyber-attacks on sensitive company data. In 2023, SMBs need to really make this a center point of their strategies and look to tighten security measures, ensuring remote staff workers are using cloud-based solutions to save data. Providing employees with secure devices which include features such as two-factor authentication and Windows 11 can also help mitigate risk.

Sustainability
With sustainability at the top of the global business agenda – with a regional commitment to the cause underpinned by the recent COP27 being hosted by Egypt and next year’s COP28 coming to Dubai – environmental, social, and governance (ESG) issues become ever more important. As we enter 2023, companies will look to make more sustainable choices, such as upgrading to the latest technologies with a view to saving energy and being more environmentally friendly.

Our research found that 64% of small and midsize businesses (SMBs) in EMEA consider purchasing decisions around laptops to be more important now than before the pandemic, with hybrid working remaining the norm for many. As older devices have a tendency to degrade the battery life of laptops, this has led to users more frequently using energy to power their tools.

This, combined with the increase in energy costs, means that companies will need to upgrade to newer technologies that can provide improved battery performance. And with wider sustainability targets becoming the front and centre for many businesses, technology sourced with lower environmental and social impact will also be an area some will start to look at for new purchases.

Supply chain issues continue but will ease
Supply chain challenges remain following the pandemic, and will continue to do so into next year – nearly a quarter (23%) of businesses anticipate this as an ongoing challenge until at least next summer. This has also not been helped recently by global economic issues, which have ultimately led to a decline in shipments of technology devices globally.

However, there is light at the end of the tunnel as we enter 2023, and as supply chains begin to stabilise, the market will be able to shift to supply keeping up with demand and returning to a bit of normality in delivering within the expected time frames, easing the full supply chain for technology devices. It’s also likely we’ll see more organisations opening up new, accessible manufacturing facilities in varying locations to increase production and prevent global issues from affecting them in such a devastating manner again.

Technologies to boost SMB employee productivity
According to our research, 19% of European SMBs listed employee productivity as their number one concern, with any amount of lost productivity proving costly.  In order to overcome productivity roadblocks, SMBs will be looking to devices, secure communications tools, and device accessories in their bid to enhance the productivity of and re-engage their remote workforce. To facilitate this, in 2023, we’ll likely see IT budgets be re-prioritised towards more reliable tech solutions and increased IT support, so employees feel supported, wherever they work from.

Conclusion
As we enter 2023, and businesses looking to establish themselves in this era of rapid digital transformation and a hybrid working landscape, it’s vital that companies continue to prioritise their IT budgets to ensure they are set up to thrive.