Overall, it appears that the IT sector will continue to grow significantly in 2023. For channel partners, Cybersecurity is growing at a rate of about 27%, compared to 7% for other managed services. That’s a good sign for the channel and vendors in 2023, however, expect recession-related spending freezes in some sectors to slow things down in IT.

You can listen to the entire 60-minute conversation I had with Jay McBain about what to expect in the channel in 2023. We also recapped the predictions made for 2022 so you can see if they came through. You can also view the ‘face-off’ from 2022 here

Many industry research firms are busy surveying and analyzing data. Jay McBain, for example, is doing a fantastic job at Canalys in connecting the dots to help translate the numbers into actionable paths. I get to see tons of research data and quite honestly, it can be overwhelming so I really appreciate what Jay does and always enjoy our annual prediction chat – so thank you Jay for doing what you do!

Remember that research data is only a snapshot in time so you have to use your experience, wisdom and imagination to guide you. The same can be said for all predictions including the ones we talked about so do your own research before taking the plunge. 

2023 Predictions with Jay McBain

While some vendors are growing by leaps and bounds with high double and some triple digits over recent years, it may not be something to bank on moving forward. Competition is heating up, pressures from inflation, interest rates, transportation and supply chain (and other factors like the war) are all going to play out in 2023. Will soon see how much of the recession predictions will actually come through.

Many vendors will need to get their house in order when it comes to partner management and development in their ecosystem. Vendors who get this right will gain a significant competitive advantage. I am looking forward to the voting results of 2022 Reseller Choice Awards to find out what the channel thinks of vendors and distributors – we have been monitoring this for the past 16 years and seeing the patterns year over year is quite interesting.

Here are a few more of my thoughts on 2023 (mostly on cybersecurity as I believe this to be the biggest challenge facing businesses and the channel).

Billions of dollars will continue to pour into the cyber industry but with relatively “little” consolidation to date, it’s likely we will see some mega mergers and acquisitions in cyber in 2023. 

No doubt, many more vendors will continue to emerge in this high-growth sector. Hopefully we will see some game-changing vendors emerge.

Vendors building out a “comprehensive” solution suite by acquiring other vendors to fill in the gaps is the biggest trend we see continuing. Integrating these solutions to work under one platform is the goal but so far, no one has anything close to a silver bullet. So at best, the goal is simply to fill in as many of the cybersecurity gaps as possible. 

[Over 4,000 vendors are currently rallying for cybersecurity positioning; To stay on top of the latest vendors, you may want to check out www.e-channelnews.com]

The surest prediction one could make is that many more companies will be hacked and many will continue to pay ransom in 2023. 

Until “we” put a stronger lid on preventing attacks expect breaches to get worse. 

The bottom line is companies need their businesses to continue so when faced with the decision, many will pay that ransom especially when the alternative is losing their data or having it exposed publicly. While some countries like Australia are making it illegal to pay a ransom, I doubt this will have a big impact.

Even businesses with strong backup and recovery systems will still face difficulties because hackers can release their data publicly. Being able to recover your data and resume business operations is no longer enough.

As such, prevention is the smart course of action in 2023, but it requires a significant amount of effort, skills, money, tools and humans. 

Everything cyber will continue to impact the cost side of income statements for nearly every business. As such, the cyber expense will become a significant factor and that cost will have to eventually be passed on to consumers. Everyone will end up paying for cybersecurity in one way or another. I think of this as the new “cyber tax”. 

In this digital-first economy, several other factors besides cyberattacks are influencing how ALL business will be conducted. None more so than employees working from anywhere. This trend is driving seismic shifts in business in ways previously thought impossible. 

Where and how fast we will get to where we are all headed is anyone’s guess but those who stay ahead of the digital transformation curve may reap the biggest rewards in the journey.

My top piece of advice for channel partners in 2023 is to up your cybersecurity game, as this is most likely your weakest link. That is exactly what the Cybersecurity Defense Ecosystem we are building is all about. You can begin your journey by signing up at www.iotssa.com.

The second step is to learn what you don’t know about your business practices by completing a free assessment at www.bestmanageditcompanies.com. The data is clear. Those who run on best practices grow faster and generate more profits. It is also a key factor in maximizing your business valuation, if you decide to sell. Regardless if you rank well or win an award, simply asking yourself these questions is a good place to start.

Finally, be open to the future of technologies like AI,RPA, IoT and 5G because what’s coming is much more than you may know. The game is changing so fast as the world accelerates deeper into a digital-first economy especially with a new generation of buyers taking over the decisions. 

It’s wise to always be learning before you become marginalized. Anytime you get an opportunity to connect with the channel community, take it. You never know what you can learn. We will be hosting several of our events and attending several more as news media in 2023. Come meet! Follow me for dates and locations. If you are around Phoenix on February 16 -17, attend the IOTSSA Cybersecurity Expo.

One piece of advice for Vendors… Stop talking about partnership simplification and start doing it! There are numerous experts available to assist you. It’s really not that difficult to figure out. Every day, I speak with channel leaders who are doing it right. Simply keep on removing all friction between you and your channel partners. The ease of doing business for everyone in your ecosystem and how they get rewarded for their contribution matters.

I’m looking forward to 2023 because I love the channel community and the amazing stories I get to tell about all the smart people in tech. As I have been saying for three decades… “The world runs on tech and the channel drives that”. 

You can catch all my interviews on www.e-channelnews.com or follow me on LinkedIn

Have a wonderful Holiday Season, Merry Christmas and remember that work is only a small part of life. Always be helping others and enjoying life…