Infrastructure operations unlocking the next TAM expansion for tech services
Artificial Intelligence (AI) compression has been widely debated across the technology services industry. However, the AI also presents expansion opportunities, and this may lie deeper in the infrastructure stack.
Three recent moves by leading providers signal an emerging shift in strategy:
- Cognizant’s acquisition of Astreya strengthens its capabilities in running and managing infrastructure operations environments
- Accenture’s acquisition of DLB signals increasing focus on participating in data center and infrastructure build-out ecosystems
- TCS’s HyperVault joint venture with TPG reflects growing provider interest in owning and enabling secure infrastructure environments
Taken together, these moves point toward a broader industry trend, technology service providers are moving beyond traditional application and transformation services into infrastructure-led operational markets created by AI adoption and enterprise modernization.
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The timing is significant, as enterprises scale AI workloads, the focus is expanding beyond applications and models into the environments required to run, manage, secure, and support them. Data centers, networks, workplace infrastructure, cloud operations, and operational support layers are becoming increasingly strategic as organizations build AI-ready environments.
This is also changing the nature of enterprise technology spending. Historically, a large portion of technology services demand was concentrated around application development, modernization, integration, and business process transformation. However, AI adoption is increasing demand for infrastructure-heavy environments that require continuous operational support, resilience, and lifecycle management. As a result, the market opportunity for technology service providers is beginning to extend deeper into infrastructure operations and long-term run services.
The market opportunity itself could become substantial. Global spending on AI-ready data center infrastructure is expected to run into hundreds of billions of dollars over the next several years. Research associated with Cornell University estimates the global data center market at approximately US$250 billion in 2023, with expectations that it could double by 2030. This growth is expected to be driven by hyperscaler expansion, enterprise AI adoption, Graphics Processing Unit (GPU) infrastructure demand, and modernization of existing infrastructure environments.
Historically, infrastructure build-outs and operational environments, especially across data centers and networks, were dominated by specialized engineering firms, infrastructure operators, and colocation providers. However, the lines are beginning to blur as enterprises increasingly seek integrated partners that can design, build, secure, manage, and operate complex infrastructure ecosystems.
AI-ready environments are also significantly more operationally intensive than traditional enterprise infrastructure environments, requiring higher compute density, low-latency networking, automation, and continuous monitoring. This is creating opportunities for providers capable of operating these environments at scale.
As a result, service providers are beginning to expand beyond traditional application modernization and transformation services into infrastructure-led operational environments that offer deeper integration, recurring revenue streams, and longer-term client relationships.
Infrastructure operations become strategic again
The rapid expansion of AI infrastructure is increasing demand for high-performance, low-latency, and operationally resilient environments. Enterprises are investing in data center capacity, network modernization, hybrid cloud environments, workplace technology, and AI-support operations to support increasingly compute-intensive workloads.
This is creating opportunities not only in infrastructure build-outs, but also in the recurring operational layer surrounding these environments, including:
- Infrastructure management
- Network operations
- Workplace services
- Cloud operations
- Monitoring and automation
- AI-enabled operational support
For service providers, this represents a meaningful expansion of the total addressable market (TAM). The opportunity extends beyond one-time transformation programs into long-term operational engagements embedded deeply within enterprise infrastructure environments.
This could also gradually shift revenue mix dynamics for service providers . While traditional transformation programs are often cyclical and discretionary, infrastructure operations environments tend to generate more stable, recurring operational revenue streams over longer periods.
Why this matters commercially
The commercial implications could be significant, as infrastructure operations environments tend to create longer-duration engagements, tighter operational integration, and higher switching costs than traditional project-based transformation services. As providers move deeper into operational infrastructure layers, they can potentially improve recurring revenue streams and deepen long-term client relationships. The opportunity also aligns well with broader enterprise priorities around resiliency, operational visibility, uptime, and infrastructure modernization. However, the barriers to entry are equally high.
The cost of playing in this space
Infrastructure-led operational environments require significant investments in operational capabilities, delivery expertise, security, monitoring, and resilience.
Data center build-outs and infrastructure operations also introduce capital intensity and operational complexity that many traditional Information Technology (IT) service providers have historically avoided.
Providers operating in these environments must manage:
- Infrastructure reliability and uptime
- Security and resilience requirements
- Hardware lifecycle management
- Energy consumption and sustainability pressures
- Disaster recovery and operational continuity
As a result, this opportunity is likely to favor large, well-capitalized providers capable of supporting complex, long-term infrastructure operations at scale.
What this means for the industry
AI is making infrastructure operations strategic again.
As enterprises scale AI environments, the market opportunity for service providers is expanding beyond application services into the operational infrastructure layer required to support these workloads.
The next phase of competition in technology services may not only be about who builds AI applications, but also about who builds, manages, and operates the infrastructure environments that enable them. For technology service providers, this could represent one of the most important Total Addressable Market (TAM) expansion opportunities emerging from the AI era.
If you enjoyed this blog, check out, AI-powered observability: The next frontier in modern operations – Everest Group Research Portal, which delves deeper into another topic relating to AI.
If you have any further questions, please contact Yugal Joshi ([email protected]), Zachariah Chirayil ([email protected]), or Lalith Kumar ([email protected]).