Comptia It Industry Outlook 2023 - Vfinal

2023 IT INDUSTRY
OUTLOOK
UNLOCKING POTENTIAL
November 2022
#IndustryOutlook
Introduction
H
eading into 2023, the signs of progress that appeared over the past year continue
to blossom. The organizations that have made it through recent and ongoing
turmoil are using their newfound resilience as a springboard into the future. The
return to strategy predicted by CompTIA’s IT Industry Outlook 2022 has become a
reality for many organizations, and they are now focused on writing their next chapter.
Those new chapters hold a tremendous amount of potential. Spurred by global events,
companies may decide to focus more effort on improving the world around them. There are
clearly big problems to solve; what may be less clear is that many solutions already have
good momentum. According to the 2022 Goalkeepers report from the Gates Foundation, the
percentage of the global population living below the international poverty line has fallen by
nearly 20% since 2015, and the rate of mortality for children under 5 has fallen by more than
50% since 1990. Organizations that choose to make an impact on social issues can help drive
greater improvement.
Closer to home, there is potential for individual company growth. The modern business
world is far less constrained by geographic reach, financial backing or language barriers.
Organizations have more opportunities than ever to diversify their workforce, reach new
customers and develop new products. Whether it is expanding current offerings or pivoting
to a new business model, companies can build on lessons learned to reach new heights.
No matter which direction an organization may choose, technology will play a starring role
in the story. Technology alone cannot solve all the world’s problems, but it can accelerate
solutions for those with the right vision. The technology industry may face future headwinds
around ethical concerns or regulatory maneuvering, but there is no doubt that those hoping
to make a difference can use technology to unlock the potential they imagine.
CompTIA IT Industry Outlook 2023 1

Trends to Watch 2023
3
Metaverse Initiatives
Will Focus on Holistic
Worker-employer Customer Experiences Cloud Acceleration
Relationship Gaps Expose Drives Demand for
New Challenges in Hiring and Orchestration and
Retaining Tech Talent FinOps
2 4
1
Business As
5
New Players in Digital
Usual Gets a Hard Ecosystem Put More
Reality Check Competitive Pressure
on Established
Practices
10
Advances in AI Spur
6
Vendors and
Debate Over the Partners Eye
Value of Content Greater Automation
With Optimism –
and Concern
9
Decentralized Identity
7
Cybersecurity
Will Become the
8
Metrics Are Tied
Heart of Web3 Efforts to Evolving Risk
Analysis Approach
Inflation Uncertainty
and Supply Chain Issues
Continue to Complicate
Sales Forecasting

Business as Usual Gets a
Hard Reality Check
I
f the pandemic has taught today’s businesses flux, customers are taking a hard look at ROI on every
anything (besides the fragility of life), it’s potential tech purchase. Which means, if you sell
that anything can happen in an instant. Scarce technology, the ability to convincingly make a specific
employees, business closures, societal lockdowns, business case for every product or service is not
remote work, the inability to source goods, you name just a nice sales differentiator anymore, it’s essential.
it. Seismic shifts are real. But do they last when the Customers are also more tech-savvy, so the bar is
crisis abates? That’s a fair question as we make our higher for what they expect from providers. If basic
way into 2023, one to which the answer is becoming security is all you offer as an MSP today, for example,
increasingly clear: Business as usual is no more. In fact, it may no longer cut it as data breach-nervous
doing things as we always have may no longer be the customers seek an expert with more sophisticated
safe option, even for companies that are content with skills. The same goes for improving other tech, sales
flat or minimal growth. Many technology businesses and marketing skills, or pursuing a business model
will have to leave their comfort zone to thrive. This that more aligns with how today’s customers prefer
means a deep navel gaze at current operations, to engage in the digital economy. So, if this means
sales and marketing, human resources, and strategic blowing up that finely optimized managed services
innovation efforts. Why? First off, customers are stack you’ve been working on since 2018, so be it. Just
evolving. While they are as enthusiastic as ever about as customers in 2023 will be scrutinizing operations,
the role technology plays in their success, they are purchasing and people, so too should their tech
also much more scrutinous and demanding in their providers. It’s business as usual – no more.
tech journey. With many of their own businesses in

Worker-employer Relationship
Gaps Expose New Challenges in
Hiring and Retaining Tech Talent
Y
ou can’t talk about toppling business as more restrictive. Part of that decision will hinge on
usual without discussing the workforce. the productivity and performance of workers, which
As tech companies in 2023 continue is gaining renewed attention today as employers
to face immense talent acquisition and grapple with ways to measure staff output and quality
retention challenges, they do so in an environment in a decentralized, virtual work environment. At this
where the worker-employer dynamic is no longer point, it is looking as if remote work and flex time will
completely recognizable. Remote work flexibility, the not be an all-or-nothing proposition for most tech
Great Resignation, quiet quitting – the headlines are companies and channel firms; hybrid situations will
relentless. The coming year is going to test employers rule. Recruitment and hiring practices are another
greatly as they aim to fill positions with workers evolving area as companies seek to fill coveted roles
skilled in a host of new and emerging tech disciplines in data, cybersecurity, cloud, metaverse and other
and support roles, while balancing two other things: disciplines with highly capable candidates with both
Empowered and/or elusive job applicants and technical acumen and durable skills. As part of this
macroeconomic uncertainty. Ironically, the two mandate, looking outside the traditional box for
just might be mutually exclusive. As an employer, new workers will accelerate as a trend. That means
which do you prefer: A hard-to-fill staffing pipeline emphasizing diversity, equity and inclusion (DEI)
and new employee demands or a recession that efforts and recruitment, dropping the longstanding
throws the hiring picture into tumult? For now, let’s four-year college degree requirement for many
set aside recession since it’s largely uncontrollable, positions, and focusing on upskilling and on-the-job
and focus on the changing workforce picture. Post- training and certification for existing employees. Lastly,
pandemic worker empowerment is a thing that’s but not least, the topic of mental health among tech
likely here to stay to some degree or another. As we industry workers will not diminish in 2023. Companies
enter 2023, businesses will need to settle on what will need to recognize the mental health issue and
kind of flexibility and culture they are going to have, its prevalence, create an environment that helps to
debating things like remote work as an absolute minimize its toll on workers and, when needed, provide
employee choice, a hybrid option or something flexibility and support for employees who seek help.

Metaverse Initiatives Will
Focus on Holistic Customer
Experiences
T
he technology trend that has captured compelling new option for digital interactions. Instead
the most headlines over the past year of viewing the metaverse as a new VR-based phase
has almost certainly been the metaverse. of the internet, it might be more accurate to view it as
A quick review of trending search terms an extension of omnichannel customer experiences. A
shows that after a huge spike in interest around similar take on the situation comes from Tim O’Reilly,
the time Facebook rebranded as Meta, metaverse who has argued that the metaverse is a vector
has maintained a slight lead or stayed on pace with of digital connection and community, and recent
other emerging topics, such as artificial intelligence trends such as increased Zoom adoption or greater
or blockchain. With all the focus, though, the big utilization of recorded video have driven progress
question has been: What exactly does the metaverse on that vector. Virtual reality adds an even greater
represent? The first impression most people have degree of immersion, but there are ultimately a limited
is a virtual reality experience complete with legless number of applications where that level of immersion
avatars, but there’s something larger at play. CompTIA pays off. As organizations consider how to build their
has previously made the point that in the broadest own metaverse for their customers, there will be less
sense, the metaverse simply represents online life. focus on headsets and virtual real estate and more
This means we’ve been living in the metaverse for focus on building depth in customer relationships
quite a while now. If that’s the case, virtual reality and creating connections between the many digital
(VR) does not necessarily represent the next plateau experiences a customer might choose.
of online life for everyone, but instead represents a

Cloud Acceleration Drives
Demand for Orchestration
and FinOps
I
f the metaverse has been the trend dominating as low barriers to entry have allowed different
headlines, cloud computing has been the trend departments to pursue their own cloud solutions. This
with the most impact on current IT activities. distributed approach to technology procurement has
Acceleration in cloud adoption has led to most created flexibility while also creating a management
organizations taking on a cloud-first approach, where headache. Someone – most likely someone on an
cloud platforms are the first choice for IT system IT infrastructure team – now needs to oversee the
and applications, and exceptions are made on a big picture across the organization. The second
case-by-case basis for reasons of critical security or step is closely related. The primary impact of cloud
unique finances. This shift to a cloud-first mentality sprawl is escalating cost, and the growing field of
has basically brought an end to the first stage FinOps addresses the intersection of finance and IT
of mass cloud adoption. In that early stage, the operations. Just as DevOps demands expertise in both
focus was on the technical challenges of migrating development and infrastructure to make software
individual systems, the lessons learned about closing cycles more efficient, FinOps demands both technical
cybersecurity gaps with a cloud provider and the knowledge and financial acumen to fine-tune cost
basic concepts of integrating different cloud and on- structures while maintaining a robust and flexible
prem components. The next stage of adoption will cloud architecture. As the lines between business and
focus on the steps organizations now need to take IT get more and more blurred, these new activities
to handle complexity in a multi-cloud environment. will help organizations control their cloud activity and
First, there will be a greater demand for orchestration, open new pathways for IT professionals.

New Players in Digital Ecosystem
Put More Competitive Pressure
on Established Practices
W
hether it’s psychologist Barry the expanding vendor landscape is going to prod both
Schwartz in his book, “Paradox of new and established players to up their game to stand
Choice, Why More is Less,” or Malcolm out among the rest. Greater choice and the ubiquity
Gladwell’s Ted Talk anecdote on 36 of technology will also have an impact on established
different spaghetti sauces in the grocery store, the business practices across the digital economy. Take
topic of choice – too much, how many, good, bad or the agricultural industry and a company like John
otherwise – elicits endless discussion. Look at the Deere, for example. John Deere, which already owns
tech landscape, where the past 15 years or so have the lion’s share of the $68B U.S. market for farm
ushered in a period of choice explosion and decision equipment sales, has built up its internal software
fatigue. More vendors, more technologies, more acumen impressively by outfitting its autonomous
partners, more business models, more relationships farm vehicles with all manner of modern features
– it's dizzying. And it’s not always what you think. and capabilities that are changing the industry.
Consider the plethora of new companies that This seems like a good thing, a nice example of the
have emerged around the as-as-service model for democratization of technology beyond the domain
software, for example. For many channel firms, the of the tech industry. And yet, John Deere’s skill with
availability of so many new vendors to choose from technology is wreaking havoc on an entire network of
has unshackled them from complete reliance on the independent equipment repair dealers that farmers
traditional behemoths in the industry and enabled have used for generations to fix their stuff. In effect,
them to explore new markets around emerging technology’s expansion to a non-tech industry, in this
technologies. This is a good thing. Yet, those same case John Deere, is restricting choice downstream to
channel firms have found that newer SaaS vendors customers (the farmers). At the same time though,
are also green when it comes to the indirect model. it is ushering in a subscription-based model for
Unlike the establishment, the new wave doesn’t know farm equipment repair that might, in the long run,
its way around setting up a partner program, benefits, be preferable. This is the choice conundrum that
compensation, enablement and support for their technology can impose and one that will only escalate
ecosystem. That’s not a good thing. In the year ahead, in the year ahead and beyond.

Vendors and Partners Eye
Greater Automation With
Optimism – and Concern
O
perational efficiency, innovation and Customized marketing. What’s not to like? And yet,
customer service excellence are but three the early going has shown that automation is not a
of the promises proponents of automation panacea. For one, the moving parts are many. There’s
have long made for companies in the vendor-to-MSP automation (think PRM tools), internal
today’s digital economy. But as most practitioners MSP business automation (think PSA, RMM and BDR
dabbling in automation today will tell you, there’s platforms) and finally MSP-to-customer automation
more to this feel-good pitch than meets the eye. Yes, (think CRM tools). Coordination among these three
just like some relationship statuses on Facebook, not only requires the right automation pieces in
automation is complicated. First off, the technology each setting, but ones that can work together in an
itself is dense. We all hear about self-driving cars integrated fashion. To date, this hasn’t happened in
and robots performing surgery, but most automation what anyone would describe as an elegant fashion.
tools and the tasks they perform aren’t sexy. Broadly Major sticking points include the fact that there is no
speaking, Robotic Process Automation (RPA) tools multi-vendor solution for individual MSPs. Instead,
help automate every day, repetitive business tasks there are disparate PRM tools from each vendor. So
spanning the simple to complex (think expense even if each vendor introduces automation of its own,
reporting or data entry), while more sophisticated it’s still disconnected and cumbersome. On a good
Business Process Automation (BPA) systems are note, distributors have been stepping in to provide a
holistic in nature, executing and optimizing the hub or aggregation point for MSPs to help manage this
lifecycle of a business process and its workflow jumble, and it’s expected that their role will continue to
components. For years now, the automation topic elevate in 2023. Finally, automation raises some more
has been a favorite in the managed services space, human questions. The potential for job elimination is
where the repeatable-process-heavy business model the obvious one, but there is also the loss of personal
seems a natural fit for these tools. In 2023, MSPs will touch that many small businesses count on to cement
continue to use and/or experiment with automation to their customer relationships. If every MSP is using the
some degree as optimism for its potential runs high. same automation systems, what makes them look
Instantaneous price quotes. Faster service delivery. different? Food for thought in 2023.

Cybersecurity Metrics Are
Tied to Evolving Risk
Analysis Approach
T
he field of cybersecurity has seen a massive these metrics to organizational objectives. Along
overhaul in the past decade. At this point, with adopting a zero trust framework for tactics,
it’s well understood that the secure perimeter companies will begin adopting an organizational risk
has faded in importance, becoming a approach to metrics. Risk analysis has been growing
single component of the cybersecurity mesh that in popularity as companies have been prioritizing their
many organizations are putting in place to protect data sets and investing in cloud security, but most
distributed assets. A natural consequence of the firms are not yet performing formal risk analysis in
shift away from a secure perimeter is that companies a comprehensive way across all business activities.
are taking a less defensive mindset and becoming That will change in the next year, as organizations
more proactive about cybersecurity assessment move further into a post-pandemic economy driven
and reinforcement. The principles of zero trust heavily by digital transformation. Determining the risk
architecture provide a framework for implementing level of digital activities, assigning a financial impact
cybersecurity policies and processes, but all the new and building a mitigation plan will provide not only
activity leaves one big question unanswered: How a connection between cybersecurity and corporate
does an organization measure progress? Simply health but also a structure for measurement. This
measuring success by whether a breach has occurred structure can then be used to justify investment,
is clearly insufficient, but there is also no way to determine skill needs or quantify cyber insurance
achieve perfect cybersecurity. While several individual activity. Modern cybersecurity is a moving target
metrics have emerged as good practices (e.g. for many organizations, but a corporate risk analysis
number of systems patched, percentage of workforce process can provide context for a new level of activity.
trained), companies have struggled to fully connect

Inflation Uncertainty and
Supply Chain Issues Continue to
Complicate Sales Forecasting
A
h, inflation. Sigh. Unfortunately, it would that build products has a downstream effect on
be remiss not to include this topic in the channel firms that face higher costs for goods,
discussion of business as usual getting more unpredictability in trying to obtain timely and
a reality check in 2023. A confluence of accurate pricing to relay to customers and an inability
economic factors has found us grappling with the to manage inventory. The tumult has a secondary,
highest inflation rates in 40 years in the United States, and much more profound effect, on most channel
among them pandemic fallout, supply chain woes, firms that happen to be small businesses. For these
energy prices and ongoing geopolitical upheaval. firms of less than $1M in revenue and 10 or fewer
The Federal Reserve has gone the route of repeated employees, cash flow is often shaky at best. Even
rate hikes to attempt to bring that inflation down – incremental increases in pricing for goods needed
at the risk of fast-tracking a recession – but the fact to run their own businesses can result in Hobson’s
remains that right now stuff just costs more. And it’s Choice-level management decisions that no one
not clear when that will abate. From a tech industry wants, such as laying off employees or instituting pay
perspective, higher inflation is leaving its mark cuts. Additionally, these smaller channel firms tend to
liberally. The entire go-to-market chain is affected, serve customers that are also small businesses. These
from tech manufacturers to channel companies selling customers are facing the same challenges around
their goods to customers buying them, and anyone cash flow and budget decisions. Some will cut back
else in the ecosystem. Manufacturers, especially in on their tech spend, others might double down. It’s
the hardware space, are at the whim of component hard to predict, but the net effect is channel firms in
pricing that is in flux, not to mention component 2023 will have a much-diminished ability to forecast
availability because of supply chain backlogs that sales accurately quarter to quarter. As with most
have not sufficiently cleared since last year when things of a broad economic nature, time will tell. But
CompTIA’s IT Industry Outlook 2022 highlighted them there is no denying that inflation at current levels or
as a trend. The uncertainty of pricing and availability worse could throw a monkey wrench into some tech
on components and other enabling technologies companies’ best laid plans.

Decentralized Identity
Will Become the Heart of
Web3 Efforts
A
lthough cryptocurrencies took a beating Web3 aims to move even more focus to individuals by
along with the rest of the stock market in decentralizing traditional models for publication and
2022, the real story in IT circles continues transaction, giving individuals more ownership. In these
to be the distributed ledger technology early stages, there is plenty of skepticism around the
that fuels this new asset class. The Ethereum Merge, eventual outcome, especially as cryptocurrencies and
switching from Proof-of-Work to Proof-of-Stake as NFTs fail to deliver on their potential and new entrants
the consensus mechanism for transaction verification, promising disruptive business models end up being
was seen as a huge step forward in making distributed new versions of centralized gatekeepers. In the middle
ledgers more sustainable. Even the term “crypto” of all the noise, though, the foundational technology
itself began referring to the underlying technology may still shape the future. Perhaps the killer application
as opposed to the various cryptocurrencies. Another for distributed ledgers is in the area of identity. Not
term that gained momentum in this field was Web3. only is identity a central component of a creator-
Building on the concepts that drove cryptocurrency based internet, but identity remains one of the most
adoption, Web3 is a broad term describing the next challenging disconnects between the physical world
phase of internet dynamics. The original version of and the digital world. Aside from fueling distributed
the internet adopted by the masses largely featured apps, improved identity solutions could also address
content created by corporations and consumed by the issue of anonymity on the internet or advance the
individuals. The term Web 2.0 was coined to describe a login process beyond username/password. The noise
new iteration of the internet where content was created around Web3 will continue in 2023, but the key area to
by individuals, primarily on social media platforms. focus on is the evolution of digital identity.

Advances in AI Spur Debate Over
the Future of Tech in Society
10
I
n one sense, artificial intelligence (AI) is no could cause many people currently providing such
longer an emerging technology. A wide array content to plummet toward obsolescence. This
of software applications now feature some sort is somewhat ironic given the goals of the Web3
of intelligent algorithms, and machine learning movement to empower content creators. Technology
is practically assumed to be part of data analysis is often viewed as a neutral player, inheriting opinions
activities. In another sense, artificial intelligence will or political positions from the people putting
never stop being an emerging technology. There that technology to use. This viewpoint is getting
is still a sizable gap between today’s narrow AI, challenged as the technology itself is getting more
which performs within a specific set of parameters, intelligent. Ultimately, tech’s neutrality may still
and tomorrow’s general AI, which performs high- hold true, but the layers of abstraction between
level cognitive tasks across multiple domains. technology creator and end user make it difficult
For today, though, even narrow AI is producing to fully understand all the thinking baked into the
fairly amazing results. The images produced by solution. This is especially true with AI, though the
DALL-E 2 or the text produced by GPT-3 are often takeaway is the same for many other emerging
indistinguishable from content produced by humans. trends. Simply understanding how to use a piece of
However, these astounding technical achievements technology is becoming inadequate. Responsible use
highlight concerns around the future of technology’s now entails some knowledge on how the technology
integration with society. Some examples of AI- functions (especially how training is performed in
produced text feature sentiments that are non- the case of AI) and what societal impact might come
inclusive to say the least. This is a byproduct of AI from the technology (especially as it relates to user
being trained on datasets with historical opinions rights and privacy). Technology and society are now
that may now be outdated. In addition, the content intertwined; maintaining a healthy balance between
generated by AI is nearing a level of quality that the two will require new depths of expertise.

Industry Overview
T
he importance of technology in our modern world means that the technology
industry is a true force to be reckoned with. The sheer size of the industry makes
it one of the dominant sectors in the global economy, and the rapid growth and
rate of change within the industry make it a central player in developing business
standards and regulations.
The impact of technology goes far beyond the core tech industry, though. While there are
myriad opportunities directly related to digital product development or service delivery,
there are countless more opportunities opening up around the world as technology
influences every business and every industry vertical.
Economic Impact Of Technology
Growth in Gross Output Digital Economy

Q1 2020 – Q1 2022 Contribution to GDP
47%
8.5%
1.7%
18%
All Data processing, Data processing, All other digital

industries internet publishing and internet publishing and economy activities
other information services other information services
Source: U.S. Department of Commerce Bureau of Economic Analysis
To start, consider economic output. According to the Bureau of Economic Analysis (BEA)
within the U.S. Department of Commerce, overall GDP grew by 18% between Q1 of 2020
and Q1 of 2022. In contrast, the sub-industry that most closely represents the core tech
industry (Data processing, internet publishing and other information services) grew by 47%.
This growth rate trailed only two sub-industries related to oil and petroleum; many other
sub-industries grew at much slower rates or experienced contraction during this time.

Although that growth alone is noteworthy, it pales in comparison to the extended impact
of digital activity. As of Q1 2022, the same sub-industry contributed to 1.7% of overall
U.S. GDP. Looking across industries at three broad categories of digital economic activity
(infrastructure, e-commerce and priced digital services), the BEA estimates that the overall
digital economy contributed to 10.2% of U.S. GDP in 2020. Roughly speaking, the extended
digital activities taking place outside the core IT industry have five times more impact than
direct tech industry activity. The exact numbers differ from country to country, especially in
maturing economies vs. mature economies, but the basic premise holds: Technology has a
massive direct and indirect impact on economic growth.
Job Postings September 2021 - August 2022
All postings with basic digital skills
10.7 Million
4.2 Million
Core IT occupations
Source: Lightcast
A second area to consider is the workforce. According to CompTIA’s State of the Tech
Workforce report, technology was expected to account for 8.9 million jobs in the United
States in 2022. This represents both those individuals working directly within the tech industry
and those individuals in core tech occupations within other industries. With a labor force just
over 158 million workers, direct tech occupations account for nearly 6% of the U.S. workforce.
Once again, the impact of technology extends far beyond these numbers. Examining job
postings from the labor analysis firm Lightcast, there were 4.2 million job postings for core
technology occupations between September 2021 and August 2022. Over that same time
period, there were 10.7 million job postings requesting skills in basic computer literacy
and productivity tools such as Microsoft Office. Of the top ten occupations within the 10.7
million job postings, only computer user support specialist is a core tech occupation. Other
occupational categories include managers, human resources specialists and registered nurses.

Global IT Spending Projections 2023
Amounts in millions of U.S. Dollars
Software
880
Devices Data center
systems
735 216
1469 1362
1358
New technologies
Communications
services
IT services
Source: Gartner, IDC
Finally, the amount organizations are spending on IT demonstrates the rapidly changing
nature of technology. Gartner estimates that 2023 global IT spending will reach $4.6 trillion
in 2023, a jump of 5.1% over 2022 spending. The categories included in Gartner’s estimate
are traditional IT components: Communications services, IT services, devices, software
and data center systems. As expected, the service categories are the largest pieces, as
most organizations have built a foundational layer of computing and are now crafting new
solutions on top of that foundation.
In addition to these traditional categories, emerging technology is driving additional

spending. Data from IDC, which CompTIA has used in previous years, shows roughly the
same level of spending in the traditional categories. IDC, though, adds a category of “new
technologies,” which includes technology such as internet of things (IoT), robotics and
mixed reality. Spending on new technologies is expected to hit $1.36 trillion in 2023, adding
nearly 30% to the expected spending on traditional items. One final note on spending
projections: The current economic chaos, including inflation and relative strength of
global currencies, is impacting forecasting models as much as it is driving uncertainty for
businesses. Actual spending may fluctuate more in 2023 than in previous years.

Industry Outlook Is Largely Positive
Industry Outlook Is Largely Positive
Average rating for health of the tech industry, with 1=Terrible and 10=Excellent
Average rating for health of the tech industry, with 1=Terrible and 10=Excellent
6.4 6.4
UK DACH
6.8
U.S.
6.4
Benelux
7.0
ASEAN
7.0
ANZ
Given both the direct and indirect impacts of technology, it is no surprise to see positive
sentiment toward the industry. Among technology firms in each of the six different
geographic regions surveyed by CompTIA, the average rating for the future prospects
of the overall technology industry skewed toward the higher end of the scale. Even with
economic uncertainties and societal issues, the tech industry remains a robust choice for
business growth and career advancement. For the remainder of this report, the focus is on
U.S. data. Separate research briefs highlight data points from international regions.
All in all, the impact of technology today goes far beyond the technology itself. Technology
is deeply ingrained into business activity and daily life. There is no question that there
are some negative elements, especially as technology applications reach massive scale
and trigger unintended consequences. However, there is also no question that there are
many positive outcomes, and a progressive approach to technology is a critical factor for
sustained success.

Careers in Technology:
Building Strategic Skills
C
aught between the recent disruption of the pandemic and the potential upheaval
of a recession, technical professionals share many concerns with the rest of the
workforce. However, the turmoil is not dampening spirits for IT pros. As with last
year, nearly 80% of IT professionals in CompTIA’s survey report feeling optimistic
about their role, including 38% who feel very optimistic. Positive sentiments are correlated
with company size; 71% of IT pros feel optimistic at at small companies (less than 100
employees), compared to 83% at both mid-sized firms (100-499 employees) and large
enterprises (more than 500 employees). In addition, nearly half of all respondents at large
enterprises report feeling very optimistic about their role.
Roles IT Pros Play Within Organization

Roles IT Pros Play Within Organization
Mostly focused on tactical activities 39%
Assessing technical skill needs 39%
Accelerating approach to technology 36%
Participating in cross-functional discussions 35%
Leading discussions around emerging trends 35%
Giving final approval for tech decisions 32%
Bringing attention to ethical considerations 29%
Defining approach to cybersecurity 28%
Explaining tradeoffs with implementation 27%
A likely explanation for higher optimism at bigger companies is the wider range of
opportunities. Given the historic view of IT as a supporting function and the daily pressures
that most companies face, it is no surprise to see that the top focus for most IT pros is tactical.
Servers still need to be available and help desk tickets still need to be answered. Beyond this
traditional role, though, there are more strategic areas for IT pros to explore, including skill
assessment across the organization, improving the cultural mindset around technology and
leading discussions across departments regarding technology adoption or future trends.

The profusion of opportunity is not just something organizations are doing to help their IT
employees. With technology now acting as a critical component in business strategy, it is
in a company’s best interest to integrate their IT specialists more deeply into operations.
Of course, with most organizations making this move, the demand for skills is outpacing
available supply, meaning that opportunities are open not only within an IT pro’s current
employer but also in other firms that may provide higher pay or better flexibility. Over the
past year, technology job postings have been plentiful and tech unemployment has been
incredibly low. There is no reason to expect a huge change to the situation in 2023.
This high-demand environment is commonplace today, but it is a relatively new

phenomenon for IT professionals. In the early days of enterprise technology, technical skill
was not needed by most organizations. Computing was reserved for the largest companies
with the biggest budgets. As technology became more widespread, the IT function was
largely viewed as a cost center, and IT pros were often constrained in both resources and
career progression. In today’s environment, companies are viewing IT through a strategic
lens and increasing both their appetite for technology and their investment. This then leads
to a high demand for skills creating a broad range of career options, which is the top reason
for optimism by a wide margin.
Focus Areas For Career Growth

Focus Areas For Career Growth
Technical skill in current area 48%
Durable skills 44%
Technical skill in a new area 43%
Advancing into management 41%
Project management 41%
Business operations 36%

As described in the trends section, the abundance of choice opens a new set of questions.
This is true for IT pros as much as it is true for companies procuring technology products
and services. With many options for career advancement, there are also many options for
building skills. The top choice for many technologists is to develop skill within their current
area of specialization. Beyond that, durable skills such as communications or teamwork are
beneficial as technology becomes more of a team sport. Rounding out the top three focus
areas, IT pros may choose to explore a new area as businesses explore topics like data
science or zero trust architecture. Many new job openings require a mix of various skills,
and technical specialists in one field may only need to add a few new skills to become fluent
in another discipline.
Whether the choice is developing skill within a current specialization or exploring a new
opportunity, there is no shortage of skills needed in digital organizations. The many
different facets of enterprise technology can be captured in four broad categories.
CompTIA’s IT framework defines infrastructure, software development, cybersecurity
and data management/analysis as the pillars supporting IT operations. At this high level,
the top priorities for the coming year are software development and data management/
analysis. This fits with a viewpoint of companies tailoring technology as it becomes more
strategic, but that does not minimize the importance of infrastructure and cybersecurity as
foundational pieces of digital transformation.
Critical Areas Within Infrastructure

Critical Areas Within Infrastructure
47%
Networking
50%
44%
Cloud computing
50%
42%
Storage
43%
37%
Server administration
36%
30%
Help desk/first line support
29%
27%
Mobile device management
33%
27%
Internet of things
27% 2023
27% 2022
Infrastructure as code
0%
NA
13%
Linux
14%

In the area of infrastructure, priorities remain fairly consistent with last year’s agenda.
The ongoing maturity of cloud operations will drive demands in the areas of networking,
storage and server administration. As cloud orchestration becomes more important, there
will be stronger desire for more advanced skills in each of these fields. Mobile device
management takes a step backward this year as there is likely less focus on equipping the
workforce, and infrastructure as code (IaC) makes an initial appearance as organizations
place more emphasis on software-defined data center operations.
Critical Areas Within Software Development

Critical Areas Within Software Development
53%
Quality assurance
53%
52%
User experience
55%
44%
Mobile development
35%
39%
Artificial intelligence/machine learning
36%
23%
DevOps
30%
22% 2023
Low-code/no-code
NA
0% 2022
18%
Containerization
NA
0%
The domain of software development is also not experiencing drastic year-over-year

change. As organizations expand the number of customized applications for both internal
and external use, there is still a high focus on quality assurance (QA) and user experience
(UX). With mobile devices steadily accounting for half of all internet traffic, optimizing
digital experiences for mobile consumption continues to be important. IT pros are
predicting less focus on DevOps in 2023, but this is largely because DevOps practices have
now become firmly established within many firms, driving a constant demand for skill but
not new investment or restructuring. Low-code/no-code solutions and containerization
expand the reach of software and create more abstraction in the development process, and
those areas are both expected to grow in importance in coming years.

Critical Areas Within Cybersecurity
Critical Areas Within Cybersecurity
Data security 58%
0%
NA
Privacy 45%
53%
Cybersecurity analytics 41%

45%
Cybersecurity metrics 38%

45%
Application security 36%

0%
NA
Risk analysis 36%
46%
Compliance 30%
39%
Workforce education 25% 2023

35%
2022
Penetration testing 22%
33%
Zero trust 17%

0%
NA
The fields of cybersecurity and data management/analysis are newer specializations for
many companies, so there is more churn when it comes to focus areas. In cybersecurity,
the acknowledgement of a shift away from a secure perimeter into a more granular
approach is finally becoming widespread and causing policy change and upskilling need.
Data security and application security were new options in this year’s survey and clearly
demonstrate how companies are reimagining their cybersecurity posture. Aside from these
two new areas, focus seems to be dropping across the board for cybersecurity topics.
This disconnect was explored in depth in CompTIA’s 2022 State of Cybersecurity report,
and it signals that companies should put more emphasis on integrating cybersecurity with
organizational objectives. One specific area to keep an eye on is risk analysis. As businesses
try to determine the proper level of investment for cybersecurity initiatives, risk analysis will
likely be the framework guiding decisions. Along the same lines, zero trust is not currently
a defined approach for many organizations, but elements of a zero trust architecture are
seeing more and more adoption.

Critical Areas Within Data Management/Analysis
Critical Areas Within Data Management/Analysis
55%
Data integration
NA
0%
45%
Data visualization
46%
45%
Database administration
52%
39%
Predictive analytics
42%
36%
Data management/policies 2023
49%
2022
26%
Blockchain/distributed ledger
24%
Integration is also a new concern in the area of data management/analysis. While many
companies still need to focus on fundamental database administration in order to create
a foundation for advanced data activities, data integration is becoming the overarching
process that defines how data will be combined from various sources and made available
for consumption and analysis. Analytics (and eventually data science) is still the end
goal, but bringing the data into a comprehensive starting point is still a major challenge.
Distributed ledger technology, such as blockchain, is slowly making inroads as an enabling
technology, and it may be some time yet before the technology moves from isolated
applications to broad usage within data structures.
While intent to hire is still strong (44% of companies expect to hire for technical skills
in 2023), internal training remains the dominant option for closing skill gaps (64%
of companies expect to train existing employees in 2023). In considering workforce
development options for the next 12 months, companies may need to invest more heavily in
certain components. A rigorous skill assessment can pinpoint the specific skills needed to
advance corporate objectives, and it can also define training options that can target those
skills. Getting closer to the actual training program, businesses can expand the types of
offerings that are provided or subsidized in order to ensure the best pathways for individual
learning styles.

Views On Technology Budget Allocation
Views On Technology Budget Allocation
55%
48% 49%
Large
Mid-sized
Small
26%
22% 22%
10% 10% 10% 10% 10%

8%
2% 2% 2%
5% 4% 4%
Much too low Slightly too low About right Slightly too high Much too high Don't know
These investments for workforce development are obviously part of the larger technology
budget, which appears to be stabilizing at adequate levels for most companies. As
expected, the perception of technology budgets skews toward the insufficient end of the
scale. Overall, though, the technology budget is healthy for most organizations, and it is
moving in the right direction; 43% of companies believe that their technology budget in
2023 will be higher than it was in 2022.
At first glance, it may seem strange that any IT professionals would believe that the
technology budget is too high. While there are only a small number of individuals in this
category, it is worth exploring the sentiment. Given that this viewpoint is slightly more
prevalent in larger firms, this may be a statement on balance. In an environment where
digital transformation is held up as a new business imperative, organizations may begin
viewing technology as a cure-all, opening the wallet for advanced technology purchases
without making corresponding investments in best practices for usage or restructuring of
business flow.
This may be exacerbated by business units making their own technology investments.
When asked to consider how the overall technology budget was divided between the IT
function and business units, IT professionals in CompTIA’s survey reported a nearly even
split, with a slight lean toward business units. Technology procurement by business units is
not necessarily a problem (and also not exactly something that can be avoided), but it does
require close collaboration. A particular business function may be closest to the situation
and best able to define functional requirements, but areas such as cybersecurity and
integration likely fall outside the technical expertise of business unit employees.

Priorities For New Investment
Web
presence
New Automation
headcount
Innovation Endpoints
Collaboration
Cybersecurity
Data analytics
One of the most useful questions for ranking technical priorities might be the consideration of
how to spend additional money if new funds became available. This leaves the field open-ended
rather than focusing on an individual topic, and it still provides some degree of constraint given
the financial context. Case in point: Automation ranks relatively low in this scenario, whereas
most organizations give automation high marks when automation is the only topic of discussion.
The tier above automation and collaboration tools contains a mixture of wish list items. There
are fairly traditional topics like web presence and cybersecurity alongside a newer topic in
data analytics. The desire for new headcount shows up here, even as skill gaps are similar to
automation as a top-of-mind issue in a vacuum. With these items so tightly clustered, the exact
priority will depend on the specific needs of an organization.
Moving to the top tier, it is somewhat surprising to see endpoints ranked so highly. Given the
large investments made to enable a remote workforce over the past two years, one might
assume endpoints are up to date. This high priority speaks to the critical need of keeping the
workforce productive. Minor glitches with laptops or smartphones can lead to major disruptions
in employee productivity.
It is no surprise, though, to see innovation in the top slot. Whether it is investing in new
products, bringing in third-party expertise or creating platforms for technology evaluation,
IT professionals believe that accelerating the approach to technology will be the biggest
differentiator for their organizations. Day-to-day maintenance and improvements are needed
for operational progress, but the cutting edge is where potential is fully unlocked.

Emerging Trends: The Next
Step for Digital Solutions
I
nnovation, like so many other things, is easier said than done. After years of a product-
centric view of IT, organizations are struggling to build a new mindset around emerging
technology. Rather than acting as standalone products that meet specific needs,
emerging trends are more often found as enabling parts of broader solutions. The
question is not so much “What can this technology do for us?” as it is “What are we doing
that could be made better through technology?”
Two of the latest trends on the horizon illustrate this point. For both the metaverse and
Web3, the perceptions from both IT pros and channel constituents highlight how the
long-term outlook may differ from disruptive predictions. These two groups, which are
the closest to technology and have navigated previous waves of emerging trends, are
very aligned in their viewpoints. Most significantly, the majority opinion is that neither
technology will likely be a revolutionary step forward. Instead, they will both augment
digital experiences and solution architecture.
Perception of
IT Pro 42% 44% 14% Channel 40% 47% 13%
Metaverse
Revolutionary digital experience Extension of existing experiences Primarily a buzzword
Perception of
IT Pro 34% 50% 16% Channel 29% 49% 22%
Web3/Crypto
Massive step in internet architecture Tool with high impact in select areas Tool leveraged within existing architecture
Aside from adopting a more comprehensive mindset, the challenges around emerging trends
center on integration and utility. As new technology develops, standards and regulations
become a defining factor in implementation, driving demand for technical skill across the
entire ecosystem. In addition, building an appreciation for the strategic use case requires an
overall understanding of business objectives and skill in education and marketing.
Top IT Pro Challenges for Top Channel Challenges for

Emerging Trends Emerging Trends
• Competing standards • Technical training needs
• Regulatory concerns • Customer education
• Clear use case for new technology • Sales and marketing training needs

The Business of
Technology: Forging
Ahead in Tough Waters
M
uch like IT professionals, companies in the business of technology (aka the
channel) are starting to think bigger again, rekindling some of the strategic
initiatives and aspirations that may have been put on the back burner during the
extended pandemic. Yet there is trepidation as well, with many channel firms of
all stripes worried about continued inflation, supply chain issues and the omnipresent threat
of an economic recession. It’s a paradoxical time as we look ahead to 2023, one in which
companies are at once ready to forge ahead with new investments and innovations yet
must do so with a dose of caution attributable to the uncertainty of the business landscape.
This dilemma is reflected in general attitudes about the year ahead. For the most part,
channel firms remain positive about their own company’s outlook for 2023, although the
numbers have dipped from last year. Sixty-seven percent of respondents said they are
feeling either very good or pretty good about 2023 compared with 77% that said the same
last year about 2022. Instead, more channel firms have adopted a mixed attitude about how
their company will fare in 2023. Twenty-four percent said they are on the fence about how
2023 will go vs. 19% that said the same last year. This sentiment reflects the guessing game
situation many companies find themselves in today as they weigh new investments and
hiring against continued inflation and a potential recession.
Perspective Of Channel Firms On 2023 Prospects

Perspective Of Channel Firms On 2023 Prospects
31%
Feeling very good
37%
38%
Feeling pretty good
40%
24%
Mixed sentiment
20%
6%
Feeling uneasy
4% 2023
2022
1%
Feeling very uneasy
1%

Breaking things down a bit more, channel respondents save their most pessimistic attitudes
for the current state of the overall economy, compared with the IT industry and their own
businesses. While 9% rate the overall economy as “terrible,” (the lowest score of 1 on a 1-10
rating scale), just 2.6% confer that dispiriting take on the IT industry and only 1% on their
own businesses. There’s a disconnect, for sure, but one that makes sense based on three
years of a pandemic in which other parts of the economy suffered greatly while the tech
sector held its own and, in fact, thrived in many areas. Responses from the most positive
end of that 1-10 rating scale bear this reality out: While 8.6% of respondents gave the
overall economy a “best” or 10 rating, 12% did so for the IT industry and 15% for their own
businesses. It’s important to note that these numbers reflect the two extreme ends of the
scale (bad and good), while most respondents fall in the middle in their assessments of all
three areas of the economy.
One of the markers that channel firms will be looking for in the year ahead is growth
potential of their own business in relation to the tech industry at large. Many are bullish
that growth potential is strong. Forty-five percent of respondents said they expect their
own revenue and profitability numbers in 2023 to exceed those of 2022 if the tech sector
flourishes. A more cautious 44% of respondents said they expect stable results on par
with the year previous, even if the tech sector does well. And finally, roughly 8% said they
still expect a decline in revenue and profitability even if the tech industry performs on the
positive side of the economic equation. Those predictions are correlated across all company
sizes, from the smallest channel firm (fewer than 10 employees) to those with more than
500 staffers.

Hedging one’s bets is normal behavior in an uncertain economy, but the reality is that
the tech industry and the businesses that operate in it have opportunity galore in the
year ahead. It’s a matter of unlocking that potential wisely. A few truths to consider: The
industry itself is more complex and changing rapidly at both the technology and business
levels. From the channel’s vantage point, that means their expertise will be in demand and
greatly valued. The tech portfolio has changed immensely, too. What was once a stable
set of infrastructure products on a reseller’s line card has, in the cloud age, morphed into a
cornucopia of software-as-a-service applications, data and cybersecurity tools, and a stack
of emerging technologies to contend with. At a business model level, everything’s in flux
as companies transition into various forms of service provider, referral or influencer agent,
consultant or combination of all. Finally, one of the most consequential developments
affecting the channel today is the changing customer, specifically their procurement habits
and technology preferences.
So, what are some of the keys to unlocking that growth and potential? Respondents cite
many factors that will help lead to an optimistic performance in 2023. Leading that list is
the ability to drum up business from new customers. Nearly 4 in 10 respondents said this
will be critical to solid performance in the year ahead. This signals a change in emphasis
from the early pandemic years when companies’ focus was on retaining and expanding
business with existing customers. That pursuit is still a prominent aim (28% cited it), but
more attention is being placed on building the pipeline this year. Along those lines, the
third activity respondents identified as helping to drive positive results next year is tied to
making improvements to and investing in both their sales and marketing functions.
Contributing Factors to Channel Firm Sentiment
Positive Factors Negative Factors
Improving Labor
internal costs/skill
Successfully operations availability Continued
reaching new
inflation
customers
Improving
Unexpected
sales and
shock
marketing

Perhaps reflecting the need to balance aggressive activities like new customer acquisition
and marketing overhauls with cost containment, the no. 2 area that channel firms believe
will be needed to contribute to a more optimistic outcome next year is to improve internal
operations. In other words, get more efficient. Whether that is streamlining internal
processes – something critical to a well-run managed services firm, for example – or
deploying new automation technologies, the quest for operational efficiency is an ongoing
component of optimal business performance.
Rounding out the list of items companies deem essential to a positive 2023 include the
successful launching of new business lines and a return to normal economic conditions
that sees inflation decrease and supply chain woes abate. One could argue that these two
factors are interdependent, given that a rough macroeconomy might be considered a
poor environment for new business ventures. But that isn’t always the case. An attribute of
many firms that weather a general economic storm well is their propensity to double down
on investments in new things. And a new business line does not necessarily mean new
products to sell (though it can). It could reflect a shift to a different business model, which
will be discussed later in this report.
As discussed in the 2023 trends outlined in this report, inflation looms large for the
channel. Among the factors that could lead to a pessimistic year ahead, continued high
inflation, cited by 41% of respondents, led the pack. The remainder of the list includes 34%
that cite concerns over growing labor costs and the need to find workers with the right
set of skills for today’s tech world, 32% that worry about any unexpected geopolitical
or macroeconomic shock to the system, and 30% that fret about customers postponing
technology purchases. The cause-and-effect element of these concerns is undeniable.
Increased inflation or other economic shock could beget recession, which could in turn
result in layoffs that upend the labor market and curtail customer spending. Or the reverse
could happen. So far, it’s been unpredictable.

One point of interest from the list of factors that arouse pessimism is the relatively low
ranking of automation as a hurdle. Just 18% cite automation as a potential threat to growth
in the year ahead. As elaborated in one of this report’s trends, it’s clear that automation is a
development that is more positive than negative. With some caveats, of course.
Let’s talk about budgets. Much like general sentiment about prospects for the year ahead,
many channel firms are making positive, yet cautious predictions about their upcoming
budgets. Compared to last year when 53% of respondents said budgets would be higher
(either much or somewhat) in the year ahead (2022), a slightly lower 46% said so this year.
And whether indicative of caution, pragmatism or both, 38% of this year’s respondents
expect budgets to come in flat, or about the same as the year before. This compares with
26% that predicted this last year. Clearly, the economy’s uncertainty factor weighs on
prognostication here, but fewer firms than last year are expecting decreases to their budget
(13% vs 16%, respectively).
Channel Firm Budget Projections

Channel Firm Budget Projections
9%
Much higher in coming year
13%
37%
Somewhat higher in coming year
40%
38%
About the same in coming year
26%
10%
Somewhat lower in coming year
10% 2023
2022
3%
Much lower in coming year
6%
Thinking about what they are currently spending in various functional areas of their
business, most respondents are relatively content with the amount. Roughly half of
respondents said spending is “about right” for sales, marketing, operations, finance and IT
at their companies.

If pressed to identify areas where spending is too low, a slight edge goes to sales,
marketing and IT functions. Sales and marketing, as indicated above in this report, are
considered areas to spend in 2023 to ensure growth and profitability. For many channel
firms, marketing has lagged in both resource allocations and general attention. Few
channel firms employ a full-time marketing staffer and the discipline itself has often been
overlooked, but on the bright side, data of the last several years shows a more concerted
effort around marketing and branding. Baby steps.
Interestingly, between 21% and 27% of respondents believe spending is either slightly
too high or much too high across all five functional buckets. Given that respondents to
the survey come from all disciplines within an organization – from the business side of
sales, finance and marketing to technical employees to managers and business owners –
this parity of agreement is somewhat novel. Again, the unifying driver may be economic
uncertainty as we enter 2023. Every job role within an organization might be looking for
ways to save money, reduce costs, etc.
All that said, channel firms have their spending priorities for the year ahead. Some of them
reflect strategic external initiatives, others the fuel for operational improvements on the
inside. Call this the yin and yang that comprise a high-performing company.
Topping the list is updating and modernizing current infrastructure, which 35% of
respondents identified as a spending priority. This is an interesting one given that
infrastructure improvements have been a focus area throughout the span of the pandemic,
when many companies throttled back on new endeavors and instead spent time and money
shoring up their own operations, as well as refreshing the basics for their customers. Clearly,
that mission is not complete.
Channel Firm Spending Priorities

Channel Firm Spending Priorities
Upgrading/modernizing infrastructure 35%
Hiring today's needed technical skills 34%
Adding new product and services lines 33%
Hiring today’s needed business skills 31%
Accelerating digitalization efforts 30%
Launching into new markets 29%
Retraining/certifying staff on new skills 26%
Innovating own intellectual property 21%
Transitioning to a new business model 21%

On par with infrastructure improvements in terms of spending priorities is hiring staff with
the right technical skills for today’s digital world, which 34% of respondents cited, as well
as adding new product and service lines of business, which 34% identified. The workforce
issue is perennial, but critically important. As companies jockey against competition, they
will need to up their game by hiring employees skilled in job roles in demand, such as those
in data, cybersecurity and emerging trends. Software acumen, specifically development
skills, will also play a larger role in the channel’s typical talent needs in 2023. Spending
priorities aren’t just centered on the technical workforce, though. Thirty-one percent of
channel firms said they will spend to seek skilled sales and marketing employees in the
next year. This would include sales reps that are adept at selling services and consulting
contracts, along with marketing professionals with expertise in social media and other
omnichannel approaches to customer communications.
Speaking of customers, understanding their needs, spending priorities and constraints is

a crucial ingredient for channel success in the new year. For years now, the industry has
seen a slow but steady shift in who holds the purse strings when it comes to technology
decision-making and procurement. More and more line of business executives today
own tech budget and routinely make critical purchasing decisions for their departments
and staff – both with and without the involvement of an internal IT department. This has
necessitated change within channel firms seeking to work with these customers, especially
with respect to sales techniques and activities, as well as marketing messaging and the
choice of conduits for communication.
Channel firms rely on some approximation of what customer budgets for technology look
like each year. It’s been a crapshoot of forecasting for many firms during the pandemic,
especially those that count the small end of the SMB market as their primary customers.
Those SMBs were hard hit during the pandemic and their tech spending in many cases
dropped off. Still, patterns were unpredictable. For some customers, the unforeseen
remote work migration forced a wave of spending on devices, Wi-Fi and other virtual
communications apps. Still others turned to the services of an MSP for the first time ever.
Channel Customer Spending Patterns

Channel Customer Spending Patterns
2022 2023
44% 47%
14% 13%
12% 11%
30% 30%
Significant increase Moderate increase Remain flat Decrease

Diving into the data, channel respondent predictions for customer spending on technology
in 2023 mirrors nearly exactly what they saw for real in 2022. That’s a safe assessment on
their part, again likely reflecting the economic unknowns ahead. Depending on how things
go with inflation and other economic variables, customer spending on technology could
surge past or retreat from these predictions.
What is completely clear is that everyone today is a potential customer of technology.

Consider the following: 17% of channel firms said they sell to a business owner/president,
26% sell to business executives, 31% sell to an IT department person and 26% sell to all
three. This means the days of speeds and feeds tech talk as the main sales call vernacular
to the IT guy are largely over. Buyers today want a channel provider that has unique
knowledge of their business mission, operational needs and goals. The shift in conversation
toward business outcomes is a learning curve for many channel firms, but the skill will be
essential moving forward as part of overall improvements to customer experience and sales
effectiveness.
Channel Firm
Channel Firm Actions
Actions ToLOB,
to Sell to SellNon-IT
To LOB, Non-IT Buyers
Buyers
Increased use of communications tools 51%
Changed marketing strategy 38%
Hired new sales staff with business skills 35%
Retrained existing sales reps 33%
No changes made 14%

Business models are changing for the channel just as the customer is. For years, we have
been hearing about and witnessing a slow march from traditional reseller of hardware
to full-portfolio solution provider to managed services provider. That is very much still
happening. But the drumbeat for business model change seems louder today, largely driven
by a digital-everything economy, cloud computing, hardware commoditization and margin
erosion, and direct procurement competition from online marketplaces and vendors.
Business model change can mean many different things to many different channel firms.
A small tweak such as adding a vertical specialty, for example. Or a major transition from
a product reseller to a company that does pure IT consulting. Whatever it happens to
be, most channel firms today report some degree of business model change or active
consideration of starting one.
Twenty percent of respondents said they have already undergone a change to their
business model in the last few years; 35% are in the middle of one; and 32% are currently
exploring one but have not yet started. Just 11% said that no business model talks are on
the table at this time. Larger firms are ahead of their smaller brethren in terms of completed
business model shifts, not surprising given their access to greater financial resources and
the ability to pilot project new initiatives while keeping their original business going. Small
firms typically just can’t do that. That said, a net 68% of micro- and small-sized channel
respondents said they were currently undergoing a business model transition.
Incidence
Incidence ofOf Business
Business Model Model Change
Change for For Channel Firms
Channel Firms
24%
25%
Have already undergone business model change
19%
16%
35%
27%
Currently undergoing business model change
38%
30%
25%
42%
Considering a business model change
31%
33%
9%
6%
No business model changes planned
11%
17%
Large Mid-sized Small Micro

What do these business model changes look like? For the most part, they are variations on
a theme: The move to recurring revenue and services. But the flavors are nuanced. Here are
the top five business model shifts respondents reported:
1. Product reseller to MSP selling everything from infrastructure to business

applications to emtech services
2. Transition to a combination of different business models
3. Product reseller to traditional MSP selling infrastructure services (devices/network)
4. Product reseller to cloud services provider managing SaaS and other cloud-based
workloads for clients
5. Transition to an IT referral or consulting business
This journey to recurring revenue and, most importantly, services has been ongoing.
But today’s realities have elevated the urgency of moving faster. More customers
buying directly from online marketplaces has many in the channel scurrying to find their
competitive play when they no longer own the initial transaction. That play takes the
form of pre- and post-sales services, including work around integration, cybersecurity,
compliance and ongoing management of the customer environment.
Drivers For Changing Business Model

Drivers For Changing Business Model
Better revenue/profit potential 50%
To stay competitive/avoid obsolescence 46%
Customers buying more technology direct 39%
Customer demand for managed services 38%
Positioning to take advantage of trends 35%
Vendors pushing in new directions 22%
Positioning the company for a sale or M&A 19%
And let’s not forget the financial piece of the picture. Services are lucrative, certainly more
profitable than hardware sales today. They also bond channel firms to their customers,
whether through ongoing project work or managed services. This customer stickiness and
familiarity has been one of the channel’s greatest assets over the years. It’s also one that
holds up during the ebbs and flows of an uncertain economy.

Methodology
This quantitative study consisted of two online surveys fielded to business and IT
professionals during September/October 2022. A total of 500 professionals based in the
United States participated in each survey, yielding an overall margin of sampling error at 95%
confidence of +/- 4.5 percentage points. For international regions (ANZ, ASEAN, Benelux,
DACH and UK), a total of 125 professionals in each region participated in each survey,
yielding an overall margin of sampling error at 95% confidence of +/- 8.9%. Sampling error is
larger for subgroups of the data.
As with any survey, sampling error is only one source of possible error. While non-sampling
error cannot be accurately calculated, precautionary steps were taken in all phases of the
survey design, collection and processing of the data to minimize its influence.
CompTIA is responsible for all content and analysis. Any questions regarding the study should
be directed to CompTIA Research and Market Intelligence staff at [email protected].
CompTIA is a member of the market research industry’s Insights Association and adheres to
its internationally respected Code of Standards and Ethics.

About CompTIA
The Computing Technology Industry Association (CompTIA) is a leading voice and
advocate for the $5 trillion global information technology ecosystem and the estimated 75
million industry and tech professionals who design, implement, manage and safeguard the
technology that powers the world’s economy. Through education, training, certifications,
advocacy, philanthropy and market research, CompTIA is the hub for advancing the tech
industry and its workforce.
CompTIA is the world’s leading vendor-neutral IT certifying body with more than 3 million
certifications awarded based on the passage of rigorous, performance-based exams.
CompTIA sets the standard for preparing entry-level candidates through expert-level
professionals to succeed at all stages of their career in technology. Through CompTIA’s
philanthropic arm, CompTIA develops innovative on-ramps and career pathways to
expand opportunities to populations that traditionally have been under-represented in the
information technology workforce.

Appendix
Perception Of Role As A Technology Professional
Perception Of Role As A Technology Professional
Small Firms Mid-sized Firms Large Firms
38%
50%
49% 34%
33% 33%
24%
5% 15% 5% 13%
3%
Very optimistic Fairly optimistic Mixed sentiments Pessimistic
Reasons for Optimism Among IT Pros

Reasons For Optimism Among IT Pros
Demand for skills leading to career options 51%
Tech career lends itself to flexibility 42%
Strategic approach to tech in organization 40%
Strong network of technology professionals 39%
Diverse skills available for exploration 39%
Perception that technology helps society 36%
Interest in cutting-edge trends 33%

Reasons For Pessimism Among IT Pros
Reasons For Pessimism Among IT Pros
Risk of outsourcing technology functions 45%
Growing risk of cybercrime 33%
View that tech is causing harm to society 30%
Inability to pursue skill growth in current role 28%
Low awareness of tech trends in organization 25%
Pressure from government regulations 24%
Expectation of larger results with less budget 24%
Difficulty in handling growing complexity 23%
Organizational Plans For Closing Skill Gaps

Organizational Plans For Closing Skill Gaps
Training employees within current skill set 64%
New hiring 44%
Pursuing certifications for technical staff 41%
Transfer/promote employees into new areas 41%
Partnering with outside firms 33%

Desired Level Of Experience For New Hires
Desired Level Of Experience For New Hires
18%
13%
Entry level (0-2 years of experience)
12%
23%
42%
38% Infrastructure
Early career (3-5 years of experience)
32%
Software
31%
Cybersecurity
28%
Data
33%
Mid-level (6-10 years of experience)
31%
30%
12%
14%
Senior level (10+ years of experience)
23%
15%
Top Skills Managers Are Looking For In IT Pro Hiring

Top Skills Managers Are Looking For In IT Pro Hiring
Problem solving 41%
Teamwork 40%
User experience 38%
Basic cybersecurity knowledge 37%
Communication 37%
Customer service 34%
Depth of skill in particular field 32%
Breadth of skill across different fields 24%
Business acumen 19%

Options IT Pros Plan To Use For Skill Building
Options IT Pros Plan To Use For Skill Building
Funded by organization 60%
Formal certification/credential
Self-funded 31%
64%
Attending industry conferences
24%
64%
Online instructor-led training courses
25%
63%
Live instructor-led training courses
22%
52%
Self-paced online learning courses
41%
56%
Individual study using online resources
41%
Individual study using books or other 58%

printed resources 34%
Year-Over-Year Budget Change For IT Pros

Year-Over-Year Budget Change For IT Pros
42%
41%
40%
38%
37%
Large
35%
Mid-sized
Small
17%
12%
10%
9% 8%
3%
2% 2%
4%
Much higher in 2023 Somewhat higher in About the same in 2023 Somewhat lower in Much lower in 2023
2023 2023

IT Pro Perception Of Potential For Emerging Trends
IT Pro Perception Of Potential For Emerging Trends
Artificial intelligence 31% 31% 27% 8% 3%
Web3/crypto 28% 31% 20% 10% 12%
Metaverse 26% 30% 23% 10% 11%
Robotic Process
26% 28% 26% 12% 8%
Automation
Quantum computing 23% 29% 22% 14% 12%
Currently h as value Expect potential in 12-24 months Expect potential in 2-5 years
Expect potential in 5+ years Do not expect potential
Channel Perception Of Potential For Emerging Trends

Channel Perception Of Potential For Emerging Trends
Artificial intelligence 24% 31% 29% 8% 7%
Web3/crypto 22% 29% 26% 10% 13%
Metaverse 21% 29% 25% 11% 14%
Robotic Process
19% 27% 30% 11% 14%
Automation
Quantum computing 17% 28% 29% 13% 13%
Currently h as value Expect potential in 12-24 months Expect potential in 2-5 years
Expect potential in 5+ years Do not expect potential

IT Pro Challenges For Implementing Emerging Trends
IT Pro Challenges For Implementing Emerging Trends
Competing standards 37%
Regulatory concerns 36%
Clear use case for new technology 35%
Clear benefits/ROI of new technology 34%
Low priority within organization 34%
Lack of technical skills 31%
No process for evaluating new trends 21%
Channel Challenges For Implementing Emerging Trends

Channel Challenges For Implementing Emerging Trends
Technical training needs 39%
Customer demand/customer education 33%
Sales and marketing training needs 30%
Competing standards 28%
Clear use case for new technology 27%
Regulatory concerns 25%
Low priority within organization 21%
Clear benefits/ROI of new technology 20%
Unknown or undemonstrated ROI 18%
No process for evaluating new trends 15%

Channel Firm Perception Of Budget Allocation
Channel Firm Perception Of Budget Allocation
Much too low Slightly too low About right Slightly too high Much too high
Sales 10% 16% 51% 14% 7%
Marketing 7% 19% 53% 14% 7%
Operations 4% 16% 52% 19% 8%
Finance 6% 16% 49% 19% 8%
IT 7% 19% 46% 19% 8%
Typical Targets For Channel Firm Sales

Typical Targets For Channel Firm Sales
IT department 31%
Business executives 26%
Business owner/president 17%
All of the above 26%

Direct Purchasing Of Technology By Channel Clients
Direct Purchasing Of Technology By Channel Clients
Reactions to Direct Purchasing
Focused on new skills areas such as
emerging technology and/or vertical 33%
specializations
Excited to adapt to new business models

65% / opportunities
31%
of channel firms
are seeing more Concerned about future of my current
15%
direct business
purchasing
Shifted focus to integration,
security, managed services and/or 8%
business consulting
Combination of the above 4%
Typical Business Model Changes for Channel Firms
From reseller/
From reseller to
MSP to cloud
infrastructure-
services
focused MSP
provider
From reseller to Greater focus

From MSP
on vertical
to MSSP general MSP
specialization
Greater focus
Greater focus
on building
on consulting/
intellectual
referral services
property

Challenges In Changing Business Model
Challenges In Changing Business Model
Hiring employees with the right skills 39%
Overall cost of transition 36%
Training employees on the new model 34%
Building adequate sales pipeline/cash flow 28%
Unforeseen changes in market conditions 28%
Government regulation/compliance 25%
Rebranding and customer awareness 25%
Finding new vendors to work with 22%
Changes to sales compensation models 22%
Satisfaction With Business Model Change

Satisfaction With Business Model Change
34%
Very satisfied 32%
30%
22%
25%
Somewhat satisfied 33%
33%
37%
33%
About in the middle 28%
26%
35%
3%
Somewhat dissatisfied 3%
6%
4%
1%
Very dissatisfied 1%
2%
0%
Large Mid-sized Small Micro

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CompTIA is responsible for all content and analysis. Any questions

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Market Intelligence staff at [email protected].

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2023 IT INDUSTRY

CompTIA IT Industry Outlook 2023 1

CompTIA IT Industry Outlook 2023 2

CompTIA IT Industry Outlook 2023 3

CompTIA IT Industry Outlook 2023 4

CompTIA IT Industry Outlook 2023 5

CompTIA IT Industry Outlook 2023 6

CompTIA IT Industry Outlook 2023 7

CompTIA IT Industry Outlook 2023 8

CompTIA IT Industry Outlook 2023 9

CompTIA IT Industry Outlook 2023 10

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CompTIA IT Industry Outlook 2023 12

Economic Impact Of Technology

Growth in Gross Output Digital Economy

All Data processing, Data processing, All other digital

Source: U.S. Department of Commerce Bureau of Economic Analysis

CompTIA IT Industry Outlook 2023 13

Job Postings September 2021 - August 2022

All postings with basic digital skills

CompTIA IT Industry Outlook 2023 14

In addition to these traditional categories, emerging technology is driving additional

CompTIA IT Industry Outlook 2023 15

CompTIA IT Industry Outlook 2023 16

Roles IT Pros Play Within Organization

Assessing technical skill needs 39%

Accelerating approach to technology 36%

Participating in cross-functional discussions 35%

Leading discussions around emerging trends 35%

Giving final approval for tech decisions 32%

Bringing attention to ethical considerations 29%

Defining approach to cybersecurity 28%

Explaining tradeoffs with implementation 27%

CompTIA IT Industry Outlook 2023 17

This high-demand environment is commonplace today, but it is a relatively new

Focus Areas For Career Growth

Durable skills 44%

Technical skill in a new area 43%

Advancing into management 41%

Project management 41%

Business operations 36%

CompTIA IT Industry Outlook 2023 18

Critical Areas Within Infrastructure

CompTIA IT Industry Outlook 2023 19

Critical Areas Within Software Development

The domain of software development is also not experiencing drastic year-over-year

CompTIA IT Industry Outlook 2023 20

Cybersecurity analytics 41%

Cybersecurity metrics 38%

Application security 36%

Workforce education 25% 2023

Zero trust 17%

CompTIA IT Industry Outlook 2023 21

CompTIA IT Industry Outlook 2023 22

10% 10% 10% 10% 10%

CompTIA IT Industry Outlook 2023 23

CompTIA IT Industry Outlook 2023 24

Top IT Pro Challenges for Top Channel Challenges for

CompTIA IT Industry Outlook 2023 25