Tag: edge computing

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IT Sustainability Think Tank: Environmental trends to redefine IT strategies in 2025

Sustainability is a critical driver for business growth. This is not just a response to consumer demand but also a strategic move to mitigate risks associated with environmental changes. For instance, changing weather patterns have already impacted over half of global businesses, prompting significant operational shifts.

Investors are also raising the bar. Companies with strong sustainability credentials are becoming more attractive, with these credentials often surpassing traditional metrics like productivity.

With this in mind, Gartner has identified nine environmental trends IT leaders need to get on the front foot of in order to redefine their IT strategies in 2025.

These trends are not just reactive measures but proactive strategies that offer competitive advantages.

Distributed energy resources (DERs)

Small-scale energy systems, such as solar panels and microgrids, are revolutionising power consumption. DERs reduce costs, alleviate grid congestion, and provide organisations with more control over energy sources. IT leaders should explore integrating DERs into operations, particularly for powering datacentres and edge computing sites.

Climate adaptation

The increasing frequency of extreme weather events necessitates robust climate adaptation strategies. Resilient infrastructure, predictive weather analytics, and other measures are essential for safeguarding operations and ensuring business continuity.

Resource-positive buildings

 Imagine buildings that generate more energy, water, or heat than they consume. Resource-positive designs are reshaping sustainable construction, with IT playing a crucial role through smart sensors, Internet of Things platforms, and real-time monitoring systems.

 Digitally enabled sustainability

 Digital tools such as analytics, artificial intelligence (AI), and automation are becoming indispensable for reducing environmental impacts. IT leaders can leverage predictive maintenance to optimise energy consumption and use AI-driven insights to identify inefficiencies across operations.

Circular economy models

The days of “take, make, waste” are over. Circular economy principles focus on extending product lifecycles through reuse, repair, and recycling. For IT, this means adopting modular hardware designs, refurbishing assets, and reducing e-waste.

Hidden greenhouse gas and emissions from waste

Unaccounted-for emissions from landfills are a silent contributor to climate change. IT leaders must track these emissions across supply chains and operations, implementing better waste management systems to address the issue.

Be prepared for course corrections on the path to net-zero

 Setting net-zero targets is easy – achieving them is another story. IT leaders must focus on practical, interim actions such as transitioning to renewable energy, tracking scope 3 emissions, and adopting carbon-offsetting technologies. Transparency is key to building stakeholder trust.

Environmental consequences of conflict

Geopolitical unrest exacerbates environmental challenges, from damaged infrastructure to displaced populations and biodiversity loss. Organisations must assess supply chain vulnerabilities and implement strategies to manage risks in volatile regions.

Space pollution

A growing concern, space debris from retired satellites and discarded rocket components threatens critical infrastructure, including communications networks. IT leaders should stay informed on this emerging issue and advocate for sustainable satellite technologies.

Ignoring these trends is not an option. From regulatory penalties to reputational damage, the risks of inaction are clear. IT leaders must take proactive steps to address environmental challenges and transform them into opportunities for growth and resilience.

This involves adopting resilient practices by building infrastructure and processes that can withstand environmental disruptions, as well as implementing systems to monitor and manage greenhouse gas emissions across operations.

Embracing circularity is another crucial strategy, which includes transitioning to modular, reusable IT assets and prioritising recycling initiatives to minimise waste.

Additionally, IT leaders should reduce dependency on centralised grids by leveraging localised energy solutions, such as distributed energy resources, to enhance operational efficiency and sustainability. By acting decisively and thinking innovatively, IT leaders can ensure their organisations remain competitive in the face of environmental challenges.

Looking ahead: a strategic necessity

The environmental challenges outlined here are not distant threats — they are immediate disruptors that demand urgent action. Every delay increases the risks of resource depletion, regulatory penalties, and reputational damage.

IT leaders have a pivotal role in shaping the response, not just by mitigating risks but by positioning their organisations as innovators in sustainability.

The question isn’t whether to act—it’s how quickly you can adapt to these realities. Organisations that proactively integrate these environmental trends into their IT strategies will not only safeguard their future but also unlock competitive advantages that propel them ahead of their peers.

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EY: Industrial companies worldwide stunted in emerging technology use

Many companies from a range of industries worldwide are stuck at a trial stage of emerging technologies usage, according to the sixth annual EY Reimagining industry futures study.

The firm surveyed 1,635 enterprises in November 2024, including 9% in the UK, 6% in Germany and 20% in the US. Respondents were drawn from a range of industries, including financial services (13%), cars and transport (13%), energy, mining and utilities (13%), and manufacturing (12%).

The study has a strong 5G and internet of things (IoT) orientation, as it has done in previous years. The lead authors come from the firm’s telecoms, media and technology (TMT) practices, Rob Atkinson, area managing partner for UK and Ireland TMT; and Adrian Baschnonga, global TMT lead analyst.

The press statement that goes with the report says nearly half (47%) of the respondents are investing in generative artificial intelligence (GenAI), compared with 43% last year.

Some 43% are investing in IoT, and 33% are investing in 5G technology, suggesting an upward trend from 39% and 27% respectively in 2024.

However, the report finds that businesses struggle to convert technology trials into live deployments. Only 1% of organisations have active deployments of GenAI. And while IoT investment seems to be rising year-on-year, the proportion of businesses with active IoT deployments is in decline, slipping to 16% this year compared with 19% in 2024.

Active deployments of edge computing are also flat year-on-year, at 22%.

CEOs get more into technology selection

The report finds decision-making inside enterprises is spreading out across the C-suite, with 49% of CEOs now involved in emerging technology strategy, including in choice of suppliers. Organisations where the CEO is a key decision-maker are further along, the report found.

Over half (51%) of businesses with CEOs involved in new technology decisions are investing in GenAI, compared with 44% of organisations where the CEO is less involved.

“As well as posing a challenge to unlocking long-term value, a failure to progress beyond the trial phase means businesses risk missing out on the combined impact of different technologies deployed together, an area where four in five (79%) organisations are looking to achieve more,” said Atkinson. “There could also be a danger that too many emerging technologies initiatives will be conducted in isolation, limiting the resulting business benefits.”

The report discovered that respondents are limitedly aware of what IT suppliers have on offer.

Some 73% said they need a better understanding of the changing supplier landscape. EY comments that this reflects “an environment where collaborative ecosystems featuring alliances between different technology providers are becoming the norm”.

More than half (56%) the respondents believe they lack awareness of their technology suppliers’ partners. Less than a third of organisations have high awareness of new mobile technology capabilities such as network application programming interfaces (32%) and network slicing (26%).

“Organisations view ecosystem collaboration as a route to access new skills and capabilities but lack understanding of changing supplier ecosystems,” said Baschnonga. “With many companies under pressure to consolidate vendors, suppliers should prioritise their ecosystem and alliance strategies by concentrating on key partners and adapting their operating models and go-to-market approaches accordingly.”

The report found the ability to scale and integrate different technologies is important to one in four (25%) of those surveyed.

“The intention to focus spending on a smaller number of key suppliers makes it even more important that ICT providers present them as effective ecosystem orchestrators, able to provide end-to-end solutions with the assistance of partners and intermediaries,” said Atkinson. “As part of this, suppliers should take care to underline capabilities that extend beyond their core products.

“While enterprises remain committed to embracing leading-edge technologies like GenAI, IoT and 5G, they are facing challenges in translating their investments into real business value,” he said. “Now is the time for IoT suppliers to reposition themselves as holistic partners to their business customers and help them realise the full benefits of their spending on digital transformation.”

In the report itself, the authors say: “This year’s findings show that organisations across all sectors remain committed to investing in emerging technologies to transform their operations – but that issues around scalability and legacy integration are top of mind. Meanwhile, ICT vendors need to pay close attention to enterprises’ increasing focus on security and growing demand for ecosystem orchestration.”

Businesses dimly aware of datacentre environmental impact

They also pick out sustainability as an increasingly relevant theme for enterprise IT, especially with regard to datacentres. “Sustainability factors increasingly weigh on decisions about emerging technology investments, with organisations more sensitive than before to the potentially ambivalent role of new technologies in the decarbonisation agenda.

Datacentres, the report’s authors comment, are an area of low environmental, social, and governance awareness for businesses. Half the organisations surveyed are unaware of their datacentres’ emissions profiles.

Respondents are looking at a range of GenAI use cases, with no standout preferences, the report found. Some 50% of businesses see cyber security and data protection as a leading GenAI impediment, while 46% said a need to improve data governance to combat risks concerning data accuracy and ethics would be critical to future implementations.

Data governance scores highest among manufacturers (46%) as a GenAI concern, while capturing productivity gains ranks top among EY’s respondents in the consumer (48%) and energy (47%) sectors.

Across all sectors, the most favoured GenAI use cases are software development, customer service and employee training or collaboration. However, financial services, healthcare and manufacturing respondents rated predictive or real-time operations and supply chain management as top-five GenAI use cases.

Upskilling and more collaboration

The report says the two most important changes that organisations can make are employee upskilling and deeper collaboration across business functions.

On a country level, education and employee upskilling is highly ranked by German respondents (36%), while deeper collaboration between business functions leads as an action among Chinese businesses (31%).

Elsewhere, Indian (20%) and Japanese (18%) businesses are most likely to prioritise collaboration with suppliers.

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Custom software and silicon set to define next-gen chips

Confidence in the semiconductor industry’s ability to meet demand is being hindered by geopolitical tensions, international trade restrictions and the push for sovereignty, according to a report from Capgemini. 

Authors of The semiconductor industry in the AI era report warn that as nations compete for control over vital technologies and resources, geopolitical tensions continue to impact the global semiconductor supply chain.

For instance, the flow of components, materials and completed semiconductor products has been hindered by international trade disputes, export restrictions and tariffs. As an example, Capgemini estimated that 14 consumer supply networks that rely on TSMC could be seriously disrupted by any military escalation involving China and Taiwan. Deteriorating US-China ties have also given rise to setbacks in the form of prohibitions on certain products and more stringent controls.

The report, based on a survey of 250 semiconductor firms and 800 “downstream” organisations that use semiconductors in their own products, found that 58% of semiconductor organisations expect higher demand for neural processing units to accompany growth in generative AI (GenAI) adoption. The study also shows that 57% of the chip manufacturers surveyed anticipate an increased need for high-performance chips, and 56% expect to see greater demand for memory-intensive chips, which, according to Capgemini, signals a shift towards advanced processing.

The report shows there is increased demand for custom chips and custom software optimised to run on them.

Jiani Zhang, executive vice-president and chief software officer at Capgemini Engineering, said advanced platforms and software are critical differentiators in the semiconductor industry, driving efficiency and scalability in design, manufacturing and deployment.

“With the growing complexity of AI, IoT [internet of things] and edge computing applications, the ability to integrate domain-specific software with hardware accelerators will define leadership,” she said. “To stay competitive, semiconductor players must embrace co-optimisation across the stack, from chip architecture to application interfaces, ensuring they can meet the escalating demands of data-intensive, low-latency markets.” 

Capgemini said that while the demand for AI chips, custom silicon chips and memory-intensive chips is expected to increase over the next 12 months, the semiconductor industry needs to capitalise on emerging opportunities. These include design and cutting-edge, sustainable fabrication methods, as well as investment in domestic sourcing and nearshoring to enhance stability.

“GenAI is driving accelerated demand for chips, and semiconductor companies face increasing demands from customers who want more personalised and software-centric experiences,” said Brett Bonthron, global high-tech industry leader at Capgemini.

“The industry should see this as an opportunity to ramp-up production and adopt a ‘chip-to-industry’ approach that supports a full-stack, ‘software-first’ set of capabilities,” he added.

“Investment in cutting-edge fabrication methods and design processes powered by AI and GenAI will be key to meet the specialised needs of emerging applications. Equally, it’s crucial that the industry further enhances sustainable manufacturing processes and uses advanced security to safeguard intellectual property.”

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IT Sustainability Think Tank: The energy challenge of AI datacentres in 2024 and beyond

The rise of generative AI (GenAI) is reshaping industries, but it’s also creating an unprecedented demand for energy.

Datacentres supporting AI workloads are expanding at a breakneck pace to meet the needs of increasingly complex large language models (LLMs).

However, this growth comes at a cost: by 2027, 40% of AI datacentres will face operational constraints due to power shortages, according to Gartner.

The issue isn’t just about availability. AI datacentres are forecast to increase electricity consumption by 160% within the next three years. Such a surge threatens to overwhelm utility providers, disrupt energy availability, and undermine sustainability goals as fossil fuel plants remain in operation longer to keep up with demand​.

Powering innovation or fueling a crisis?

The insatiable energy appetite of hyperscale datacentres is outstripping the ability of power grids to cope. AI models require immense computational power for training and operations, making 24/7 energy availability essential.

Yet renewable energy sources like wind and solar are not yet capable of providing the reliable baseline power needed without significant advancements in energy storage.

This mismatch between demand and supply has far-reaching consequences. Rising energy costs will drive up operational expenses for AI products and services, impacting organisations across industries.

Meanwhile, the concentration of datacentres in regions like Ireland and Singapore is already forcing local governments to limit their expansion due to power constraints​.

Sustainability at stake

The strain on energy grids is having a knock-on effect on sustainability goals. In the short-term, many datacentres will need to rely on fossil fuels, increasing their carbon footprints and delaying progress toward net-zero targets. While longer-term solutions like advanced battery storage or modular nuclear reactors hold promise, they are not yet viable at scale​.

For organisations committed to sustainability, this presents a dilemma. Balancing the deployment of energy-intensive GenAI applications with environmental responsibility requires innovative approaches, such as adopting smaller language models, leveraging edge computing, and collaborating with datacentre providers to optimise energy use.

Rethinking the future of AI

The current trajectory of AI-driven innovation poses hard questions for business and IT leaders. How to sustain growth in the face of energy constraints? What strategies will mitigate the impact of rising costs and environmental pressures?  Organisations must prioritise efficiency in AI workloads, re-evaluate sustainability goals, and actively support the development of greener energy alternatives like clean hydrogen and small nuclear reactors​.

As the demands of GenAI reshape the global energy landscape, success will require more than just technological prowess. It will demand foresight, collaboration, and a willingness to innovate sustainably.

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