Navigating 2024: Finding opportunities amid challenges
Adam Simon, UK MD at channel service provider CONTEXT rounds up the biggest trends of the year that was and where we stand today
As we close out 2024, the IT channel finds itself navigating a landscape marked by contrasting dynamics.
On one hand, the surge in AI-driven investments has sparked optimism, while on the other, economic uncertainties continue to cast a long shadow over IT spend.
The CONTEXT Forecast report unpacks key trends that have defined this year and we consider what lies ahead.
AI investments: A catalyst for change
The highlight of 2024 has undoubtedly been the growing momentum behind AI-based servers.
This trend has catalysed a 22.9 per cent year-on-year (YoY) growth in server revenue in Q3, with AI platforms claiming a notable 13.5 per cent market share, up from just 1 per cent last year.
These figures are more than just statistics; they show a shift in how businesses are prioritising technology to stay competitive.
However, the AI boom also brings a series of complexities.
The long sales cycle and the shift back to on-premises infrastructure have introduced challenges.
While these investments promise long-term gains, they demand patience and resilience from stakeholders.
For IT distributors, the task will be to position themselves as enablers of this transformation by ensuring a robust supply chain and value-added services.
PC market: A glimmer of hope
The PC market’s performance in 2024 has been a tale of mixed fortunes. Q3 showed a modest 1 per cent growth in unit sales and 3.2% in revenues.
While these figures may not be ground-breaking, they are a testament to the sector’s resilience amid weak business demand in key markets such as for example Germany.
The upcoming end of Windows 10 support will be a turning point.
As businesses prepare for upgrades, we anticipate a boost in notebook and desktop sales.
But the question remains: will it be enough to reverse a four-year decline in desktop PC sales?
The answer may lie in how effectively manufacturers and distributors leverage this upgrade cycle.
Enterprise networking: Signs of stabilisation
Enterprise networking has faced a stifling year, with a staggering −22.8 per cent YoY revenue decline in Q3.
Yet, the first signs of stabilisation emerged in Q4 with quarter-on-quarter revenue growth.
This sector has been a microcosm of the broader challenges—from supply chain disruptions to post-pandemic adjustments. The hybrid work evolution offers a silver lining.
We believe that as companies invest in smarter office setups, the demand for enterprise wireless solutions is set to rise.
However, the road to recovery will require overcoming supply chain bottlenecks and capitalising on innovations like Wi-Fi 7, which could redefine the market by late 2025.
Displays: Sustainability drives demand
The display market has been an area of interest across the tech distribution landscape, particularly the rise of large-format displays (LFDs).
While unit sales grew by 9.7 per cent in Q3, revenues faced a slight dip due to pricing pressures.
However, the sector’s focus on sustainability—with environmentally friendly models like direct-view LED (DVLED)—has struck a chord with consumers and businesses alike.
The “rebirth of retail” and the push for digital signage have bolstered demand. Moving forward, tapping into sustainability-focused funds and promoting energy-efficient technologies will be key for driving growth.
Accessories: Small wins, big potential
In a year where larger IT investments have been deferred, accessories have quietly outperformed expectations.
Carrying cases, keyboards, and headsets have seen steady growth, with consumers opting for these upgrades as a cost-effective way to enhance their tech setups.
Interestingly, the rise of AI could spur demand for specialised accessories, such as keyboards with dedicated AI buttons.
While these developments may not revolutionise the market, they’re a reminder of how incremental innovations can capture consumer interest.
The road ahead: Optimism with caution
As we look ahead to 2025, several trends stand out.
The anticipated rollout of Windows 11 in the second half of 2025 will provide a much-needed boost to both PC and desktop sales.
Similarly, advancements in enterprise networking and AI-driven infrastructure are likely to unlock new opportunities.
That said, challenges persist. Geopolitical tensions, supply chain issues, and lingering economic uncertainty will continue to test the resilience of the IT channel.
The key to navigating these headwinds lies in adaptability.
Whether it’s embracing sustainability, tapping into emerging technologies, or diversifying product offerings, the IT channel has to stay agile.