At this point, we’re all well aware AI is changing the technology industry. The question nobody particularly enjoys asking is which parts of the business will actually take the hit.
Forrester has attempted to put some structure around that question with a new AI Disruption Model, which assessed 17 technology and service categories spanning more than 200 markets. Some of the findings might make some providers a little itchy around the collar.
The research sorts markets into four categories based on how AI is expected to affect them: disrupted, neutral, contested and accelerated. Forrester looked at nine factors, including how much work AI can take over, how labor-intensive a market is, switching costs, regulatory shenanigans and how well it supports AI agents.
Technology services face heightened AI disruption
Here’s the itchy part—Forrester puts the category smack in the middle of the “disrupted” camp, with pals like application development and software and growth and transformation services.
The common thread here is labor. These are businesses where a good chunk of the value has traditionally come from work performed by people, and AI is getting increasingly capable of doing some of that work itself.
Forrester specifically calls out technology implementation and custom software development, as well as creative services and corporate training, as areas likely to feel the fun pressure.
That doesn’t mean those businesses disappear. But it does complicate the math when work that once required substantial human labor can suddenly be completed with considerably less.
“The challenge for technology and service providers is not simply understanding where AI is advancing but how it will reshape the economics of their markets,” said Ted Schadler, Forrester vice president and principal analyst. “Providers need to assess where AI will accelerate growth, alter market dynamics, or substitute existing value to make smarter bets about where to invest, compete, and partner.”
Infrastructure, data and security emerge as growth areas
There is another side to Forrester’s findings, and it’s particularly relevant for providers already working across infrastructure, security and data.
Infrastructure, data and AI, and identity, access and network security are the only three categories broadly classified as accelerated.
As organizations deploy more AI systems and agents, they need the underlying infrastructure and the data to make them useful. They also need identity controls, security and governance around systems capable of taking increasingly independent actions.
“Every technology and service market is facing an AI overhaul,” said Craig Le Clair, Forrester vice president and principal analyst. “But the benefits of AI will not be evenly distributed. Only infrastructure, data and AI, and identity, access, and network security are broadly positioned for clear growth.”
MSPs may need to rethink their services mix
For service providers, that creates a bit of a catch. AI can make some services way faster and cheaper to deliver, which is super great until customers start expecting to pay less for them. Classic.
Meanwhile, all that AI still needs infrastructure, data, and security. There’s still plenty of work on that side of the equation, as MSP owners have told Channel Insider throughout this past year.
We’ve heard variations of the “AI will change services” argument for a good while now. Forrester’s model puts some actual boundaries around it.
AI adoption is already changing where MSP growth is coming from. Recent Forrester research found APAC providers moving beyond traditional IT support as customers spend more on AI, cloud, security, and advisory services, offering a glimpse at what that changing services mix can look like in practice. Read more here.