Tech and Digital 2025 – The start of geo and tranversal tech

The year 2024 saw elections in over 70 countries, a historical high for any single year. Many national agendas cited tech, and the need for self-sufficiency and sovereignty as national priorities. 

The Tech and Digital industry is a confluence of a broad and diverse segment of organizations, made up of capitals, semiconductor firms, platforms, software, and the electronic hardware and networking companies that drive the digital transformation of all the other industries. With innovations such as customized chips and AI workflows, rapid advancements in each of the Tech and Digital sectors promise disruption across all the other industry verticals. 2025 holds immense promise across all of these sectors.

Here are the more secular macro trends by segments in the Tech and Digital industry:

Software and Digital – platforms, platforms, platforms

Software and Digital is the largest of the sectors within the Tech and Digital industry. The biggest trend within Software and Digital is platformization. The pivotal role of platforms cannot be overstated. This is the piece of customer-facing software that becomes the foundation to deliver, deploy or manage countless services, applications, software and technologies.

New trends in platforms include:

1. AI-Native Platforms
2. Platforms as a Market Place
3. Super Platforms and interoperability

These are the “new & next” of this segment within Tech and Digital.  Cloud platforms are embedding agentic AI services to enable intelligent workflows, developer assistants, and autonomous decision-making. Examples include: Salesforce Einstein Copilot, SAP Joule, Azure AI Studio, AWS Bedrock Agents. AI here isn’t just a feature, but a core interaction layer for users and apps, and hence becomes a horizontal that will feature across all segments.

Cloud platforms are becoming commerce layers that connect ISVs, APIs, and services, facilitating the monetization of developer marketplaces like AWS Marketplace, Azure Marketplace and Google Cloud’s Alloy DB ecosystem. The main area of growth in this segment will be industry-specific marketplaces such as healthcare APIs, AI agents, and fintech compliance tools. Cloud platforms are morphing into super platforms that integrate IaaS, PaaS, SaaS, ML, edge, and ecosystem orchestration. That would mean easing interoperability between platforms. Cloud platforms are investing in edge marketplace ecosystems for low-latency services, including Telco APIs, IoT agents and autonomous systems Example: AWS Wavelength, Azure Stack Edge, GCP Anthos.

Positioning the future of the Tech and Digital industry for platform and software companies lies in the contextually rich intersections of industry verticals. There is a significant opportunity in contextual specialization within this wealth of knowledge. Platform and software players (who boast a CAGR of over 12%) are defining the future for all industries and have the largest addressable market, valued in billions of dollars. They lead the innovation agenda globally and have the highest propensity to outsource.

Semiconductors – more specialized, more local

Tech nationalism is emerging as a major theme, driven by the sovereignty and resilient supply chain goals of every industry and country. Semicon talent is currently concentrated in a few countries. This is especially true for manufacturing and testing (FAB & ATS) which are mainly concentrated in Southeast Asia and Taiwan. Thus, to build an in-country semiconductor eco-system, the first requirement is talent. In a segment on track for a $1 trillion turnover by 2030, this is a massive priority.

Some of the most prominent trends in the semiconductor industry are node size reduction (shrinking of transistors), Gen AI chips, AI/ML Integration into chip design and in-house development of chips. Another very important development in semiconductors is the evolution of RISC V as an open-source, modular architecture. This allows developers to create processors tailored to specific needs by offering a flexible platform for building, porting, and optimizing software, extensions, and hardware. 

Many of the chips designed for training and using Gen AI cost tens of thousands of dollars and are primarily destined for large cloud data centers. However, by 2025, Gen AI chips or lightweight versions of these chips are expected to be found in various other locations, including:

• Enterprise Edge: These chips will be integrated into enterprise edge devices, enhancing their capabilities.
• Computers: Both personal and enterprise computers will start incorporating these advanced chips.
• Smartphones: Mobile devices will benefit from the power of Gen AI chips, enabling more sophisticated applications.
• Other Edge Devices: Over time, other edge devices such as IoT applications will also adopt these chips.

These chips are also being utilized for various purposes, including:

• Generative AI: For creating new content and applications.
• Traditional AI (Machine Learning): For tasks such as data analysis and predictive modeling.
• Combination of both: Increasingly, these chips are being used for a combination of Gen AI and traditional AI tasks, providing versatile and powerful solutions.

It’s no surprise then, that the demand for semiconductors that can better handle AI is going through the roof. The race is on to develop chips that can handle the workload required to support AI. As NVIDIA CEO Jensen Huang said, “The future of computing is AI. Our goal is to provide the most powerful and efficient AI computing platforms to accelerate innovation across industries.”

Across industries, companies are working on specialized processors, designed for AI applications. For example:

• Amazon Web Services (AWS) and Google have begun developing their own chips to reduce reliance on overstretched players like Nvidia. These chips are tailored for specific workloads, ensuring greater control and efficiency.
• With the rise of electric vehicles and autonomous driving technologies, automotive semiconductors are becoming increasingly critical.

Finally, for the sake of tech sovereignty and resilience, the semiconductor industry is finding new geographies.

Across the board, one thing is true for the semiconductor industry: intelligent manufacturing is the order of the day.

Electronics and Hardware – built for purpose

AI-Centric Hardware Architectures:Purpose-built AI chips (like NVIDIA Grace Hopper, AMD MI300X, Intel Gaudi) are overtaking general-purpose CPUs for AI workloads. Edge AI accelerators are enabling faster inferencing in IoT, autonomous vehicles, and smart factories.

Hardware-Based Cybersecurityled byzero-trust hardware roots, and integrated silicon security in CPUs and GPUs (e.g., AMD SEV, Intel TDX) for secure AI, fintech, and cloud workloads are in order. Physical-layer security in networking devices becoming standard in critical infrastructure.

Composable Infrastructure is continuing to gain momentum withhardware infrastructure becoming software-defined and on-demand followed by disaggregation of compute, storage, and networking into composable building blocks via high-speed fabrics (like CXL, NVMe over Fabrics).

The demand for AI infrastructure is on a vertical rise leading to energy-efficient compute & cooling innovations with a massive focus on power efficiency due to AI compute intensity. This entails an adoption of liquid cooling, chip-level thermal design, and carbon-aware scheduling.

Trends in the Tech and Digital industry are created by the tech majors. These eventually drive the much broader digital transformation of all the other industries.

Looking to capitalize on these trends? Capgemini is uniquely positioned to become the partner of choice for of the tech industry, here to help you build and drive strategic value.