2023 – a year of digital transformation

03 February 2023

2022 saw a great deal of advancement the world over in networking and ICT. So, what will the key trends be for network managers and engineers over the course of 2023? Amy Saunders discusses

The year ahead looks a tough one for businesses amid rampant inflation, rising energy costs and evolving geopolitical tensions. However, in the UK at least, the networking sector remains upbeat, with heavy investment and the move to new systems and processes expected.

Digital transformation ramps up
Digital transformation will continue to be a key priority in the UK in 2023, boosted further by the adoption of hybrid and remote working during the COVID-19 pandemic.

“Companies will reassess the technologies they ‘hastily’ implemented during the pandemic,” said Jim Liddle, VP access anywhere product, Nasuni. Businesses will now look to ensure that they’re able to support the new working landscape: “the winners will be those companies enabling business continuity for global remote workforces.”

The software-as-a-service model for business-critical systems has become a huge priority. “With firms now truly adopting a cloud-first and mobile-first IT strategy – and especially for document management in a decentralised working environment – adopting a similar approach for knowledge management will be among the key initiatives for this function in 2023,” said Javier Magaña García, CTO, Lexsoft Systems.

Indeed, secure and sustainable cloud practices will be key for longer-term growth and success.

“Most organizations have just started adopting cloud migration and cloud-native due to the COVID-19 pandemic, with the demand to work from anywhere catalysing the adoption and proving it works,” said Avishai Sharlin, division president, Amdocs Technology. “We are also seeing edge computing and emerging solutions start taking shape, and distributed computing and edge computing are becoming real business opportunities at scale.”

Piyush Mishra, director of solution consulting, Tecnotree Corporation, agrees that the trend towards the adoption of cloud and hybrid cloud infrastructure represents a strong movement towards moving apps to the cloud for access anytime, anywhere, and offering everything-as-a-service. “We predict that we will see an increase in microservices-based module selling in the cloud.”

The volume of data being produced as we enter 2023 – 2.5 quintillion bytes daily at last count – is reaching an almost overwhelming size for enterprises the world over, with unstructured data posing a particular challenge for network managers. The global data sphere is expected to more than double in size from 2022-2026, and unstructured data now makes up 80-90% of new enterprise data.

“This significant growth is linked to digital transformation, which accelerated vastly over the last two years as hybrid working drove a need to collaborate across locations, resulting in additional file-sharing needs,” said Liddle.

This data grows daily, and with strict regulations in place governing data, enterprises will seek a manageable solution: “edge cloud computing will proliferate rapidly to help improve response times and drive more efficient use of bandwidth, and this will demand the real time correlation of network, services, and application resources,” said Jürgen Hatheier, CTO EMEA and APAC, Ciena.

The convergence of WiFi and 5G
Developments in mobile networks have skyrocketed, with 5G rolling out across the globe.

“2023 will be the year when connectivity comes more sharply into focus,” said Mike Hoy, technology director, Pulsant. “In the EY survey of UK businesses, 43% admit they struggle to understand how 5G connectivity relates to emerging technologies such as edge computing. Yet 5G will continue to grow in the UK.”

Despite this lack of understanding, “2023 looks to be the ‘year of true 5G’ with faster 5G standalone (SA) adoption and deployments and many innovative monetisation use cases launching or in trials worldwide,” said Mishra. “From enterprise 5G / industry 4.0 use cases to private 5G networks, AR and VR, network slicing and IoT, we predict that 2023 will be the year when 5G SA deployments take off.”

The adoption of 5G SA is expected to face certain headwinds, however, as per Steve Douglas, head of 5G strategy, Spirent: “challenges include the complexity of multi-vendor and cloud-native 5G SA environments, ongoing performance issues, increased security risks and migration trade-offs to guarantee performance and align with spectrum portfolios.”

Additionally, 5G/WiFi convergence is expected to begin in earnest this year, with many enterprises highlighting a desire to support enhanced flexibility and differentiation.

“In 2023 we expect to see more momentum towards 5G WiFi convergence use cases driven by enterprise demand and commercial strategies,” said Douglas.

Interestingly, the adoption of artificial intelligence (AI) tools for automation is thought to be key to network evolution: “the capability to manage the mobility, device location, and to adapt autonomously to environmental changes will be the main characteristics of new wireless solutions,” Chris Dyke, sales director UK & Ireland, Allied Telesis. “To accommodate this increase in complexity, smart network management tools, incorporating elements of AI, will become more widely adopted.”

Mishra agrees that adaptive AI will fuel better decision making by operators: “ideally, the lines between ‘thinking’ and ‘doing’ will also be blurred and AI will be available to the masses for every function.”

Changing workplace environments
As we enter 2023, enterprises find themselves in a precarious position, facing challenges like skyrocketing inflation and interest rates, high energy prices, and low but climbing unemployment (3.7% as of December 2022). Driving efficiencies will be a top priority.

“In times of financial stress, businesses typically look to streamline productivity, processes, and tech. ‘Consolidation’ will become something of a buzzword,” said Liddle.

“Many ‘big tech’ brands have made announcements about cutting their workforce in recent weeks,” said Christian Brink Frederiksen, CEO and founder, Leapwork.

“Those that are retained are often asked to take on more work to cover for those that have been let go. This means the remaining team spends time keeping things afloat and papering over cracks, rather than focusing on the innovation that can steer a business out of difficulty. Businesses should be investing in automation tools that handle the day-to-day and free up their talent to create.”

Indeed, automation is expected to be key in lowering operational costs and streamlining operations: “there will be a need to evolve the skills of the IT team; IT engineers will need to be able to dovetail from network management to network security, but also to take control of all other services that run over the network,” said Dyke. “A new family of tools are required that can automate large parts of the IT activity and to provide a complete vision of any aspect of the network in a simple way and recommend the actions the human operators should take.”

Moreover, according to several respondents, including Nick Stapleton, managing director of ETB Technologies, despite overall improvements, a tech skills gap remains which must be addressed by organisations themselves: “looking outside of the box and engaging with young people in schools and colleges must happen. The recruitment marketplace is also likely to be boosted through entrants to the market coming from some of the big US-based tech businesses who are streamlining their teams.”

Meanwhile, the COVID-19 pandemic evidenced the effectiveness of tools like Teams, Google Apps, Zoom, etc. for remote collaboration. “While some still feel challenged with not having as much face-to-face interaction, others question whether that in-person interaction mattered as much as they initially thought?” asked Craig Williams, CIO, Ciena. “In the coming year, we will start focusing more on work itself rather than the destination it is taking place. Companies will experiment with new immersive metaverse-type platforms and look for ways to reimagine the work experience.”

The metaverse has been highlighted as a key area to watch for enterprises in 2023: “We believe businesses will continue to look for ways to reimagine the office experience with virtual workspaces and virtual tools. This will drive greater investment in the connectivity requirements to support new applications like VR, AR and the metaverse,” said Jürgen Hatheier, CTO EMEA and APAC, Ciena.

A recent study found that 78% of survey respondents across the globe would participate in more immersive experiences such as the metaverse, over current tools like video conferencing, Google Meet or Zoom. However, “none of these immersive, virtual experiences will be successful without the proper network upgrades, and advances in technology that will support the ultra-low latency and high bandwidth applications,” said Hatheier.

Deploying AR and mixed reality (MR) solutions will allow business leaders to create the basis for an industrial metaverse, according to Hendrik Witt, chief product officer, TeamViewer. “These technologies will also offer huge potential to improve the efficiency of industrial value chains across industries. Barriers to entry to the industrial metaverse are also set to be lowered via the increase in smart phones being used to bridge the gap.”

An evolving cyber landscape
As we enter 2023, the cyber landscape is more daunting than ever.

“The question is not ‘if’ your organisation is going to be hit with a cyberattack; it’s a question of ‘when’ and ‘how often.’ Your organisation will get attacked, and it could get attacked multiple times,” said Eric Herzog, chief marketing officer, Infinidat. “Cyber resilience is among the most important and highly demanded requirements of enterprises today to combat cyberattacks across the entire storage estate and data infrastructure.”

Cyber insurance premiums are on the rise and are expected to be an ongoing issue in 2023 and beyond. The combination of sophisticated cyber threats and the challenging economic climate means some SMEs may be priced out of insurance cover completely.

Moreover, it’s likely that the way insurers quantify risk will change, according to Lawrence Perret-Hall, director, CYFOR Secure. “Instead of looking solely at the sensitive data a business holds, and the financial consequences of a breach, they will also start to take into consideration their level of protection – what they’re doing to improve their security posture and how proactively they’re identifying and mitigating threats.”

Multi-factor authentication (MFA) fatigue techniques have proven effective against Microsoft, Cisco, and Uber in recent months, raising new questions about certain aspects of cybersecurity. “The widespread success of this tactic will soon force businesses to leave behind MFA strategies and search for verification alternatives. It’s likely that many organizations will begin to look toward passwordless authentication as the preferred method of authentication,” said Miles Hutchinson, Jumio CISO.

Indeed, the era of passwordless authentication is well underway as businesses across sectors continue to adopt biometric identity verification. “Even as facial recognition technology reaches upward of 99% accuracy, fraudsters have engineered workarounds through the likes of face morphs, deepfakes, digital image manipulation and the use of synthetic masks,” said Stuart Wells, Jumio CTO. “These concerns will remain top of mind for enterprises heading into 2023, which paves the way for the rise of multimodal biometric adoption in conjunction with multimodal liveness.”

As we look to the future, security needs to be included by design, rather than an add-on.

“Data security considerations have always been top of mind for our customers, but in 2023, IT leaders will evaluate every solution, including data storage, by its ability to protect data from the multiplicity of threat vectors,” said Paul Speciale, chief marketing officer, Scality. In 2022 the data storage industry evolved to embrace advances in AI/ML, hybrid clouds and edge computing that enabled greater data sovereignty and flexibility. “In 2023, the pace will accelerate so IT teams will obtain long-promised features that deliver a significant uptick in efficiency.”

Additionally, when it comes to cyberattack, where does liability begin and end? “For the first time, in the fallout of the Uber cyberattack, we saw a CISO served with a custodial sentence,” said Rick Jones, CEO and co-founder, DigitalXRAID. “The question of personal liability and where responsibility and accountability start and end – as well as how businesses and individual stakeholders will protect themselves – will gain prominence in 2023.”

Summing up
Those active in the UK’s networking and IT industries remain positive about prospects for the year ahead despite facing an ocean of challenges and a rapidly evolving landscape.

Connectivity and networks are seeing fantastic leaps forward in technological capabilities, feeding back into enhanced working environments and driving higher demand for low latency, secure access. The continued development of the metaverse is expected to have a significant impact on UK enterprises, although many remain sceptical about its true value. Moreover, as new advancements come into play, new opportunities for bad actors arise, while cybersecurity experts battle to stay one step ahead of adversaries.

While the challenges of 2023 are many, so too are the opportunities.