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AMD announced the Ryzen 7 9800X3D on October 31, 2024, with availability starting November 7, 2024. Priced at $479, it features the new “Zen 5” architecture and 2nd Gen AMD 3D V-Cache technology, offering up to an 8% gaming performance improvement over its predecessor, the Ryzen 7 7800X3D (priced at $449 at launch).

At stock settings, the AMD Ryzen 7 9800X3D boasts eight cores, 16 threads, a base clock of 4.7GHz, and a boost clock of 5.2GHz. The 2nd Gen 3D V-Cache — now located under rather than on top of the CPU die, which improves heat transfer from the core — allows users to enable Precision Boost Overdrive (PBO), making the 9800X3D the first overclockable X3D processor. This helps overcome a key limitation of first-generation 3D V-Cache processors, which was a significant reduction in clock speeds compared with standard Ryzen parts. This means the Ryzen 7 9800X3D is ideal for both gaming and productivity tasks that depend on low memory latency and higher clock speeds. It makes this processor a compelling upgrade for existing Ryzen 7 5800X3D users and a suitable solution for those demanding even more performance than the Ryzen 7 7800X3D can deliver.

In this review, we’ll cover the key features of AMD’s flagship gaming processor, its advancements over the previous generation, and its gaming performance, and conclude with advice for the vendor.

The Zen 5 Architecture and the AMD Ryzen 9000 Series Desktop Processors

AMD’s Zen 5 architecture introduces significant enhancements in terms of energy efficiency, performance, and computational capabilities — particularly for machine learning and AI workloads — thanks to full-width (rather than half-width, double-pumped) AVX-512 and VNNI support. According to AMD, it achieves a notable 16% improvement in IPC across 13 common desktop workloads over the previous generation Zen 4–based CPUs. The Zen 5 core complex die (CCD), which now uses TSMC’s 4nm process, offers substantial power reductions. At standard thermal design power (TDP) points (65W, 105W, 170W), AMD reports an average 22% increase in performance per watt.

The New 800 Series AM5 Platforms

The Ryzen 7 9800X3D is supported by the AM5 platform. AMD has committed to supporting the AM5 socket through at least 2027 and potentially beyond, ensuring long-term compatibility with future Ryzen processors and making it a reliable choice for upgraders.
The AMD 800 series chipsets — the X870E, X870, X850, and X840 — introduce AMD’s latest motherboards. The X870 and X870E motherboards feature USB4 and support PCIe Gen5 for both x16 graphics and SSDs, setting them apart from the competition. The main difference between the X870 and X870E lies in the number of I/O lanes, such as SATA and total PCIe lanes.

The X870 and X870E motherboards are optimized for overclocking and can achieve DDR5-8000 speeds and beyond, depending on the hardware. However, AMD does not support the new CUDIMM standard for higher-clocked DDR5 DIMMs in either the Ryzen 7000 or Ryzen 9000 series platforms — and this is an area where the 3D V-Cache of the Ryzen 7 9800X3D can help drive performance for memory-intensive workloads or games.

2nd Gen AMD 3D V-Cache Technology

With Ryzen 7 9800X3D, AMD is introducing the 2nd Gen AMD 3D V-Cache technology. The key improvement lies in the cache’s location. Previously, the 3D V-Cache was layered on top of the Zen 3 cores (in the Ryzen 7 5800X3D) and Zen 4 cores (in the Ryzen 7000X3D processors) and required additional structural silicon to provide support for physical stability. However, in the Zen 5–based Ryzen 7 9800X3D, this cache is now placed below the processor cores, and is a single piece of silicon for simplified design and manufacturing.

This change allows the Zen 5 CCD to be directly in contact with the integrated heat spreader (IHS) and the cooling solution mounted on top of it, resulting in better heat transfer and higher sustained clock speeds, which lead to better performance.
Consequently, the Ryzen 7 9800X3D features a 500MHz faster base clock and a 200MHz faster maximum boost clock compared with the Ryzen 7 7800X3D. Additionally, the Ryzen 7 9800X3D is fully overclockable, with the same clock and voltage limits as standard Ryzen 9000 processors.

The Test Platform

Hardware components for the test PC used in this review include the AMD Ryzen 7 9800X3D processor, the base model AMD Radeon RX 7900 XTX graphics card, an ASRock X870E Taichi motherboard, and a G.SKILL Trident Z5 Neo 32GB (2x16GB) DDR5-6000 CL28 memory kit. The Windows 11 main drive was a 1TB Samsung 990 PRO NVMe Gen4 solid state drive and a Thermaltake View 71 Tempered Glass Full Tower case was used.

An ARCTIC Liquid Freezer III 420 water cooler was installed for the processor, which was paired with a be quiet! STRAIGHT POWER 11 Platinum 850W power supply. For QHD tests, 34″ Dell Gaming S3422DWG monitor — a Quad-HD 3440×1440 display with a 144Hz refresh rate, FreeSync, 10-bit colors, and high dynamic range support — was used, while for 4K testing, a 48″ LG OLED48CX5LC 120Hz monitor was used.

The reviewers used the motherboards’ default settings, set the memory profile to EXPO 6000, and made sure that Smart Access Memory was enabled. No special tuning, optimization, or overclock was carried out for the tests.

Gaming Performance

The following tests were carried out using the built-in benchmark utility for each game.

Shadow of the Tomb Raider, Far Cry 6, and The Callisto Protocol

In Shadow of the Tomb Raider, Far Cry 6, and The Callisto Protocol, the 9800X3D delivers 107, 134, and 205 frames per second (FPS) on average respectively, at the highest settings, with ray tracing set to Ultra and FSR set to Quality, at 1440p resolution at 120Hz.

For Shadow of the Tomb Raider, the 9800X3D delivers 86 FPS at 4K.

Microsoft Flight Simulator 2020

While QHD and 4K gaming may be GPU limited in some scenarios compared with 1080p resolutions — typically used for esports titles, where the CPU is the limiting factor — a number of games are heavily CPU dependent, such as Microsoft Flight Simulator 2020 (MFS2020). When settings are dialed to Ultra at 4K native resolution and with a terrain Level of Detail (LoD) of 400, the GPU is underutilized most of the time, with the CPU being the limiting factor in the test.

For this game, we also tested the Ryzen 7 5800X3D, with the original top-mounted 3D V-Cache architecture, with the same settings. It was often unable to sustain its rated maximum boost clocks of 4.5GHz in this game and managed only 24 FPS, with a 1% low of 20 FPS. Meanwhile, the Ryzen 7 9800X3D was able to boost all cores to 5.2GHz and maintain those speeds at stock settings. As a result, it achieved 58 FPS in MFS2020, with a 1% low of 35 FPS. This 140% increase in performance shows the potential performance uplift for owners of the AM4-based Ryzen 7 5800X3D of an upgrade to AM5 and the Ryzen 7 9800X3D, with its improved thermals and higher sustained clock speeds for a much-improved gaming experience.

Upgrading from Older Platforms

Upgrading to the 9800X3D involves not just the cost of the CPU but also potentially a new motherboard and RAM, especially if you’re moving from an older platform such as the Ryzen 7 5800X3D or the Ryzen 9 5900X (which we reviewed four years ago). Many users might consider skipping the platform upgrade to allocate their budgets toward a higher-end GPU, particularly in high-resolution display scenarios where the GPU is the bottleneck.

To gauge performance improvements, we tested both platforms.

Both processors were overclocked using Precision Boost Overdrive for the following tests.

In Shadow of the Tomb Raider, the two platforms achieved almost identical average frames per second. However, the Ryzen 7 9800X3D rendered 52% more frames on average (334 versus 220), though it was bottlenecked by the GPU.

In Far Cry 6, there was a 28% increase in average FPS. Finally, in The Callisto Protocol, the average frames per second were 13% higher. This indicates that even at 1440p, there is a double-digit benefit from upgrading from the 5800X3D, despite having four extra cores, when playing modern and optimized games.

From a performance improvement point of view, the Ryzen 7 9800X3D makes much sense for those that have a platform that is two or more generations old, such as the Ryzen 5000 series. The performance improvement is substantial and with the modest power demand of 120W, the Ryzen 7 9800X3D can run on many cost-effective AM5 motherboards that support overclocking, including previous-generation B650 and X670/X670E motherboards. DDR5 memory support has increased in capacity per DIMM, and RAM has dropped substantially in price. With the Ryzen 7 9800X3D, many issues around memory latency and bandwidth are effectively masked by the 3D V-Cache, allowing cheaper but larger-capacity memory to be used.

The upgrade argument for a user of the Ryzen 7 7800X3D is perhaps less clear since the performance uplift is not as large, and the cost of the new CPU is not insignificant. The Ryzen 7 7800X3D remains popular and its street price is at or above the RRP, so users wishing to upgrade will most likely find a willing market for their used CPUs, helping to justify the upgrade.

Overclocking

We enabled Precision Boost Overdrive, which remains the best method for overclocking while maintaining optimal power efficiency. It’s important to note that PBO is an advanced overclocking feature and may void the warranty, according to AMD. In the BIOS, under the Advanced settings, we set the limits to “Motherboard” and adjusted the CPU Boost Clock override to “+200MHz.” We incrementally adjusted the Curve Optimizer, starting at -10 and achieving stability at -35 on all cores, verified through Cinebench 2024 testing.

With the ARCTIC Liquid Freezer III 420 AIO cooler in our first 9800X3D system, we reached a frequency of 5.2GHz on all eight cores under a 10-minute full load in Cinebench 2024. PBO enabled us to hit 5.4GHz, with a maximum temperature of 84C and power consumption of 140W. This resulted in an 12% improvement in our Cinebench 2024 score (from 1234 to 1381).

Besides overclocking manually in the motherboard’s BIOS, users can also use the Ryzen Master tool to fine-tune performance. This flexibility allows advanced users and overclocking enthusiasts to fully explore and enjoy the capabilities of this chip.

Final Words and Conclusion

The first generation of AMD’s 3D V-Cache technology was a welcome addition to the Zen 3 and Zen 4 architectures, propelling certain processor SKUs to the top of gaming performance charts. However, it had limitations in terms of clock speed and thermal performance. The second generation, designed for Zen 5, builds on the previous generation’s advantages, being placed beneath the core complex die to improve heat transfer, which helps sustain high-clock performance. AMD’s commitment to innovation and rapid execution is clearly paying off.

While there is a strong focus on gaming performance, the high core speeds of the 9800X3D, especially across an all performance cores, make it suitable for entry-level to midrange productivity tasks, from office applications to photo editing and light rendering. It is also well-suited for CAD/CAM applications, such as using SolidWorks for 3D printing. This processor offers great value for professionals by day and gamers by night.

The suggested price for the AMD Ryzen 7 9800X3D is $479, compared with the initial price of $449 for the AMD Ryzen 7 7800X3D. Keeping the price below $500 and only 7% higher than its predecessor is a competitive move by AMD, ensuring this chip remains mainstream and popular despite being a flagship product.

The 3D V-Cache technology also helps compensate for system RAM speed and overall latency. Although Socket AM5 motherboards are interoperable with CUDIMMs at reduced data rates in bypass mode, it would be beneficial for AMD to enhance its memory controller in future generations of chips, to support anticipated speeds beyond 8,000 MT/s. Furthermore, improving the Infinity Fabric clock speeds would help in keeping pace with these rapidly increasing memory clock speeds.

Mohamed Hakam Hefny - Senior Program Manager - IDC

Analyst Profile
Mohamed Hefny leads market research in EMEA on professional workstation PCs and solutions. He also reports on professional computing semiconductors, processors, and accelerators (CPUs and GPUs), as well as breakthroughs and trends related to the market. In addition, Mohamed is actively involved in AI PC taxonomy and research. He participates in business development projects, contributes to consulting activities, and provides IDC customers with analysis, opinions, and advice.

As 2024 comes to a close, the rollout and adoption of 5G in Europe stand at a pivotal juncture. This year has seen significant progress but also challenges that continue to hinder its full potential. Let’s reflect on the milestones achieved, the obstacles overcome, and the outlook for the coming year, positioning 5G as a key driver of innovation for businesses of all sizes.

Key Achievements of 2024

1. Expansion of Network Rollout

5G coverage has expanded significantly across Europe, reaching rural areas and less-developed regions, spreading the availability of 5G Standalone widely across key markets in Europe. This has reduced the digital divide and unlocked opportunities for new business models based on advanced connectivity.

2. Consolidation of Enterprise Use Cases

Industries such as manufacturing, logistics, and automotive have led the adoption of 5G through mobile private networks (MPN) and are beginning to look at network slicing capabilities that are still not fully available commercially. These industrial solutions have enabled operational optimization and applications such as predictive maintenance and real-time remote control.

3. Push of OpenAPIs

A significant milestone in 2024 was the formation of a consortium led by Ericsson, a group of communication service providers (CSPs), and Google to drive the adoption of OpenAPIs. This initiative aims to standardize and simplify the integration of 5G capabilities, opening doors for monetization through new digital services. By enabling seamless interoperability, OpenAPIs pave the way for developers and enterprises to create innovative solutions, further enhancing the value of 5G in both consumer and enterprise markets.

Challenges Remaining

1. Investment Profitability

Although deployment has advanced significantly, and many industries are already looking at 5G as a “no brainer”, monetization remains a challenge. Many operators struggle to justify returns on 5G investments, particularly in saturated markets where consumers perceive 5G as an extension of 4G.

2. Fragmented Ecosystem

The European landscape remains characterized by fragmentation, with differing regulatory frameworks and adoption levels across countries. This limits economies of scale and complicates cross-border solution implementation – a good example being the spectrum required to deploy 5G mobile private networks

3. Business Awareness and Education

Despite progress, some enterprises and many SMEs still lack a clear understanding of 5G’s benefits. This knowledge gap hampers broader adoption, particularly in traditional sectors.

Outlook for 2025

1. Prioritizing Business Innovation and Cocreation with Customers

5G infrastructure is essentially ready to fly, but it must solidify its role as a key tool for digital transformation. Multinationals will leverage its capabilities to scale global solutions, while SMEs can focus on tailored solutions to enhance competitiveness.

2. Expansion of Use Cases

5G is a fantastic enabler to get fast, accurate and reliable data from enterprise operations and customers, and aggregate those into platforms where insights can be extracted. Based on this, technologies like edge computing and artificial intelligence (AI) integrated with 5G are taking center stage and they will continue to do so. These will enable new real-time services, such as autonomous fleet control or connected healthcare applications.

3. Harmonized Regulatory Framework

The European Union is expected to move toward more uniform regulations, fostering a more favorable environment for collaboration and innovation across the continent.

4. Sustainability Focus

Energy efficiency will remain a priority. 5G, combined with sustainable solutions, can help reduce energy consumption in key sectors, contributing to Europe’s climate goals.

Conclusion

2024 has been a year of consolidation for 5G in Europe, marked by significant achievements but also highlighting challenges that remain. Looking ahead to 2025, priorities must focus on maximizing the business and societal impact of 5G, reinforcing its role as a driver of innovation for companies of all sizes. Only by doing so can Europe lead the race toward a connected and competitive future.

Alejandro Cadenas - Associate Vice President - IDC

Analyst Profile
Alejandro Cadenas leads the European Telco Mobility unit, comprising the CISs European 5G Monetization and Adoption Strategies, European Consumer Telecoms Strategies, and European Internet of Things Ecosystem and Trends. The focus of these three programs is to address the Monetization strategies, best practises, challenges and recommendations for all players across the telecom sector. The key areas addressed include, but are not limited to, OpenAPis monetization, 5G monetization in the Enterprise (Mobile Private Networks, Slicing) and Consumer (digital products categories) segments, Partnerships, Commercial stratregies, key customers and pain points, LEO satellite connectivity, Mission Critical systems, as well as all strategies to take these to the market.

The intersection of market trends, industry developments, and technological advancements is transforming how organizations function, innovate, and provide value. New and emerging technologies have the potential to significantly transform our daily lives and work environments.

For governments and the public sector, a period of reflection is underway on the potential impacts of new technologies on governance, citizen participation, and the establishment of adequate regulations to ensure these technologies are utilized for the benefit of society.

For companies, now is the time to adopt and integrate new technologies. In today’s fast-paced and ever-changing landscape, it’s crucial for organizations to comprehend the potential of emerging technologies as they navigate their strategic direction amid ongoing change and uncertainty.

What Are Emerging Technologies?

Emerging technologies are innovative advancements that are currently developing but have yet to reach widespread adoption. IDC identifies three main features that must coexist for a technology to be an emerging one:

• Early Maturity: Emerging technologies are no longer just concepts — they are actively being developed and refined. Early business applications highlight their promise and potential for significant impact.
• Potential to Create New Ways of Working and Living: Emerging technologies have the power to fundamentally transform society, reshaping how we live, work, and interact with each other. They can challenge established norms and revolutionize the structures of organizations.
• Broad But Uncertain Impact: Emerging technologies have far-reaching implications, albeit with varying degrees of certainty regarding their ultimate outcome, thus bearing potential risks. The impact refers to the industry scope and the number of applications within the same industry.

How Emerging Technologies Transform Industry and Society

The Role of Government

Emerging technologies are revolutionizing society and industry, driving significant changes in how we live, work, and interact. Successful governments task regulators with ensuring that they bring balance to the economy when regulating. They must ensure market fairness and consumer protection while fostering an environment conducive to business, innovation, and economic growth.

Regulation

Governments and international organizations are setting standards that span multiple facets of the digital landscape, from AI to data privacy protection to fostering a resilient digital economy and sustainability. Governments are increasingly enacting legislation around antitrust, sustainability, and technology risk.

For instance, the EU’s Digital Markets Act targets tech monopolies, while the AI Act addresses ethical and data privacy concerns. These regulations require companies to closely monitor and adapt to the evolving digital regulatory landscape in the EMEA region, particularly focusing on areas such as ESG regulations, data and AI regulations, digital economy enablement, and privacy and security regulations.

A proactive approach ensures compliance and helps to leverage regulatory changes as a competitive advantage.

Privacy and Security

The rapid pace of technological advancement is transforming our lives — and it is imperative to ensure its safe and responsible use.

For over a decade, Europe has been a leader in enacting digital privacy and security regulations. The EU’s technology regulations are designed to protect consumers and businesses while promoting innovation.

The General Data Protection Regulation (GDPR) is one of the most important to date. The GDPR has had a significant impact on how companies around the world handle personal data. These regulations can be difficult for businesses to understand and implement, but they help create a more respectful and orderly society. In the long run, these regulations can lead to greater protection of individual rights.

Innovation and Research Policy

Governments can play a key role in driving investment and commercialization of emerging technologies by providing funding, creating favorable regulatory environments, and fostering collaboration between industry, academia, and government.

• Innovation and Research Policy: Creating frameworks that support bringing ideas to market
• Funding and Grants: Providing financial support to all types of organizations for research and development
• Public-Private Partnerships: Collaborating with private sector companies to advance technological development and work collaboratively on projects, policy, and regulations
• Tax Incentives: Offering tax breaks or incentives for companies investing in emerging technologies
• Education and Training: Investing in education and workforce development to build the necessary skills for emerging tech industries
• Infrastructure Development: Supporting the creation of the infrastructure needed for new technologies, such as 5G networks or renewable energy grids

All sectors of society have a vested interest in working with governments and vendors to ensure that Europe continues to pursue ambitious innovation targets and drive global competitiveness.

Strategic Recommendations for Vendors in the Emerging Tech Landscape

Technology vendors should adopt a proactive and strategic approach to emerging technologies. Just as governments must play their part as an enabler and regulator, vendors must play their parts as innovators and users of new technologies.

  1. Lead the innovation strategy. Embrace a persona-driven approach to product development. Create a technology radar to spot emerging trends and strategically plan product road maps. This proactive stance ensures relevance and positions you as a market leader.
  2. Propose targeted solutions. Align your value propositions with clearly identifiable and targeted use cases. This enhances the perceived value of your offerings and increases presales success rates. Articulate how your solutions address specific pain points within different industrial sectors to differentiate yourself effectively.
  3. Master your messaging. Tailor your marketing messaging to resonate with diverse customer personas, such as heads of strategy and innovation. Advocate for pilot projects and proof-of-concept initiatives to engage prospects and showcase the practicality of your solutions.
  4. Empower your partnerships. Foster collaborative relationships through co-development programs and comprehensive partner training. Facilitate knowledge exchange and skill-building exercises to drive innovation and expand market reach. Work with government bodies where possible to build research and innovation communities that contribute positively to industry and society.
  5. Optimize services delivery. Equip your teams with the skills and processes needed to support emerging technologies. Invest in training and enablement programs and implement support frameworks to ensure seamless customer experiences and maximize product utility.

 

In a rapidly changing technological landscape, it’s crucial for technology vendors to anticipate future trends to become market leaders and drive business value. Businesses that can identify and adopt emerging technologies early on will be at the forefront of innovation, outpacing competitors.

However, success hinges on having a skilled workforce that can adapt to new technologies and drive innovation. By investing in employee training and development, businesses can ensure they have the talent needed to capitalize on emerging opportunities and maintain a competitive edge.

As technological evolution accelerates, adapting swiftly and effectively is no longer optional — it is a critical imperative for thriving in the future marketplace. By committing to ongoing innovation, collaboration, and responsiveness to market shifts, organizations can not only navigate change but also leverage it as a catalyst for growth and success.

Are you ready to stay ahead in the ever-evolving landscape of emerging technologies? Our comprehensive research dives deep into the adoption levels, key drivers and barriers, and the essential skills and IT infrastructure necessary to harness these innovations effectively. Discover how organizations across EMEA are leveraging EmTech to drive value and explore key use cases that are transforming industries. Contact us for more information on how we can help you navigate the future of emerging technologies!

Europe will present strong opportunities for unified communications and collaboration (UC&C) and contact center (CC) vendors/providers in 2025. Businesses are increasingly receptive to modern technologies — but succeeding in this market requires tailored approaches by country and business segment.

1. The European Market Will Become More Vibrant and Dynamic

As the external environment evolves and legacy infrastructure comes to end of life, European businesses are more open to upgrading to modern IT infrastructure that can drive future business outcomes. Awareness of what modern technology can achieve is growing thanks to campaigns led by market players. AI is contributing to this receptiveness, with businesses recognizing its immense potential.

Our European UC&C and CC research has revised upward the five-year forecast for both markets. While Europe is ready to embrace new technology at a faster pace, it is important to understand that this complex and unique market requires a tailored approach by country. This economy, composed largely of small and medium-sized businesses (SMBs), has been underserved and offers new opportunities. To succeed in Europe, it is crucial to understand specific country dynamics and buying behaviors and the value Europeans place on trust and working relationships.

2. UCaaS/CCaaS Bundles Will Become More Popular

UCaaS/CCaaS bundles are not new, but IDC’s 2024 European Enterprise Communications and Collaboration Survey indicates their growth will accelerate. This will be driven by contact centers as well as businesses that do not operate contact centers but require lightweight contact center functionalities for customer engagement (marketing/sales). This is particularly true for Europe, where contact centers are relatively smaller and the economy is comprised of more SMBs, making them inclined to consolidated solutions. Their smaller operations also make them more agile and adaptable to new solutions.

Businesses increasingly understand that isolated stacks create silos, leading to disjointed and frustrating experiences for both employees and customers, negatively impacting business outcomes. Businesses realize that analytics can reveal meaningful insights for informed decision-making. Given the large proportion of smaller businesses, resource optimization is important, leading to the blurring of front- and back-office workers. AI can facilitate this by guiding workers through workflows, minimizing the need for in-depth expertise. From an IT perspective, a consolidated stack is easier to manage, leading to greater efficiency.

3. Hybrid Deployments Will Grow

Europe is opening up to modern technologies but the transition from legacy to cloud is not linear. Some businesses/verticals will need to remain on premises for security reasons. Those migrating their entire stack from on premises to cloud will usually do so in stages, resulting in a period of hybrid deployment. IDC’s European Communications and Collaboration Survey showed that contact center hybrid deployments in Europe will grow over the next two years, although some countries will differ. The survey also revealed that a small fragment of businesses may return to on premises from cloud. Providers must offer flexible options to meet customers where they are and provide what they need.

4. GenAI Will Shift to Value-Based Conversations

While the benefits of GenAI are widely discussed, the conversation in 2025 will shift to the actual value it drives. This involves evaluating benefits in relation to costs. In theory, GenAI can automate many functions in UC&C and CC, driving greater efficiency while keeping overhead costs down. However, GenAI is still expensive and businesses are exploring use cases specific to their needs. Efficacy remains an issue due to dispersed data sources and unstructured formats.

There are also concerns about data privacy. Despite GenAI’s fluidity in interactions, sufficient guardrails are needed to prevent data leakage, limiting its performance. Businesses will consider pricing more closely in relation to benefits. Some functions, such as summarization, have become popular. GenAI is here to stay but needs to be value-driven going forward. Vendors/providers need to showcase real-life cost benefits that customers have derived from their GenAI solutions.

5. Opportunities for Service Providers Will Increase

There are some gaps in the market deterring the adoption of modern UC&C and CC technologies and this will create scopes for service providers in 2025. Our survey found that a key reason why businesses are not migrating to the cloud is a lack of the support needed to do so. This includes support with identifying the right solutions, implementation, change management, and aftersales service.

Another reason is that alternatives do not match specific requirements, indicating the need for customization and integration with business-specific IT applications. The emergence of GenAI creates new opportunities, including data management, consolidation, and aggregation. Service providers can also form strong partners in catering to the SMB segment.

 

Europe is set to become a dynamic market in 2025, offering ample opportunities for vendors/providers — but competition will be fierce. Succeeding in this market is not just about innovation but also about getting the go-to-market approach right. This involves understanding the intricacies of the European market very well.

IDC’s European Unified Communications and Collaboration and Contact Center research provides in-depth coverage of the European market by country and business size segments and can offer data-based strategic guidance.

Oru Mohiuddin - Research Director - IDC

Analyst Profile
Oru Mohiuddin is a Research Director in the European Enterprise Communications and Collaboration team. Based in London, she is responsible for IDC’s coverage of Unified Communications and Collaboration in the region. Her work focuses on tracking the markets for premise-based and cloud solutions and new developments and trends, particularly in the light of changing work patterns impacting the traditional mode of enterprise communication. Prior to joining IDC, Oru worked for Euromonitor International, where she focused on Future of Work and technology in the SMB context. She also worked in New York and Bangladesh and speaks English and Bengali. Oru was awarded Chevening Scholarship by the British Foreign and Commonwealth Office to pursue her MSc in International Development from the University of Birmingham. In addition, Oru has a BA from Marymount Manhattan College in New York.

In the first blog of our e-invoicing series, we explored the pivotal role of e-invoicing in pioneering the transformation of business-to-business (B2B) transactions. In our second blog, we dove deeper into the regulatory frameworks influencing these digital transformations, examining the opportunities and challenges that arise as businesses adapt to evolving compliance requirements.

In this third and final blog in the series, we explore the future of e-invoicing as it arrives with haste in Europe. We conclude with some clear guidance on selecting and implementing e-invoicing solutions.

The Rise of e-Invoicing Mandates in Europe

First was Italy, followed by France. Next in line are Germany and Poland, with Belgium, Romania, Hungary, Spain, Portugal, Greece, and others soon to follow. e-Invoicing mandates are rapidly spreading across Europe, and we anticipate a surge in new B2B e-invoicing requirements.

For organizations operating in any of these markets, or across multiple countries on this list, maintaining compliance will be a challenge. Each country has its own set of rules, making it difficult to stay up to date. However, with the right strategy, you can simplify this process considerably.

Let’s explore the challenges and opportunities and consider whether e-invoicing is merely about staying compliant — or if it can also be a competitive advantage.

Navigating Regulatory Complexity and Volatility

One of the biggest headaches organizations face when it comes to e-invoicing is the fragmented and ever-changing regulatory landscape in Europe. Although several initiatives are aiming to harmonize regulations across member states, presently there is no single, overarching EU e-invoicing act. Each country has its own unique set of e-invoicing requirements, including formats, procedures, and deadlines.

This complexity makes it difficult for organizations to remain compliant across multiple jurisdictions. Regulations can change frequently and there may be little warning. With numerous mandates on the horizon, this volatility is likely to become an even bigger pain for organizations across the continent.

The Growing Demand for Compliance as a Service

With the pressure to stay compliant growing, more organizations are turning to cloud-based solutions that offer “compliance as a service.” These platforms help organizations navigate the challenging world of regulations by handling compliance across multiple countries. This frees companies to focus on what they do best instead of getting bogged down by paperwork and admin tasks. As the regulatory landscape continues to evolve, this trend will only get stronger as more businesses realize the benefits of outsourcing compliance.

Exploring Vendor Diversity in e-Invoicing Solutions

The European e-invoicing market is set to grow rapidly over the next five years, fueled by new mandates and the potential for automation. The market has attracted a wide range of vendors, each bringing unique strengths from fields such as AP/AR automation, tax compliance, ERP, EDI, and others.

Of course, you can also expect to have e-invoicing capabilities added by your financial application vendor as a part of regular updates, or you may purchase a standalone solution. The challenge for businesses lies in identifying the option that is best suited to their specific needs from the vast array of possibilities available.

Potential for Automation and Efficiency Improvements

Compliance may initially seem like a burden, but e-invoicing has the potential to be a catalyst for wider business improvements. Companies that view e-invoicing as an opportunity rather than a challenge can leverage it to automate their invoicing workflows, reduce manual errors, and enhance operational efficiency. By adopting a strategic approach, organizations can align e-invoicing compliance with their broader digital transformation goals.

What’s Next for e-Invoicing in Europe?

The European e-invoicing market is poised for rapid expansion, driven by regulatory pressures and technological advancements. Over the next five years, e-invoicing adoption is expected to accelerate, potentially reaching near 100% adoption rates in some sectors and countries. This growth will be fueled by both national mandates for B2B transactions and the European Union’s VAT in the Digital Age (ViDA) initiative, which aims to standardize digital reporting and compliance.

Ongoing digital transformation will also continue to reshape the market. Companies that adopt robust e-invoicing solutions stand to benefit from improved efficiency and enhanced data transparency. As automation becomes more prevalent, businesses will be able to reduce manual tasks and enable employees to focus on higher-value activities.

Recommendations for Selecting and Implementing e-Invoicing Solutions

Prioritize Regulatory Coverage

Given the growing complexity of e-invoicing regulations across Europe, it is critical to select a solution that covers relevant current and future geographies and that can adapt to evolving rules and requirements. This will ensure that your organization remains compliant across all jurisdictions, mitigating the risk of fines or penalties due to noncompliance.

Choose a Scalable, Cloud-Based Solution

A cloud-first solution offers significant advantages over other deployment types, including scalability, flexibility, and ease of updates. As e-invoicing regulations continue to evolve, a cloud-based solution will allow your business to scale operations seamlessly, particularly if you are operating in multiple countries or plan to expand in the future.

Focus on Integration and Automation

When selecting a solution, ensure that it integrates smoothly with your existing financial and ERP systems. Look for automation features that handle tasks such as invoice generation, validation, and error correction. Automating these processes will reduce manual effort, minimize human errors, and enhance overall efficiency.

Align e-Invoicing with Broader Business Goals

Rather than treating e-invoicing solely as a compliance issue, consider how it can support your broader business objectives. A well-implemented e-invoicing solution can improve transparency and streamline processes, making it a vital component of your company’s long-term digital strategy.

Carefully Evaluate Vendor Capabilities and Strategies

When assessing potential vendors, look beyond the basics. Challenge them with real-world scenarios to see how their solutions perform under pressure. Request a live demo or trial period to gain hands-on experience. Additionally, prioritize vendors with a forward-looking approach, particularly those investing in and incorporating AI and machine learning capabilities to stay competitive as the landscape evolves.

 

Further Resources

If you are in the process of evaluating e-invoicing solutions, we invite you to check our latest report on the subject. The IDC MarketScape: European Compliant e-Invoicing 2024 Vendor Assessment provides a comprehensive overview of the e-invoicing landscape in Europe, highlighting the challenges, opportunities, and key trends shaping the market. For organizations looking to implement an e-invoicing solution, the report offers invaluable insights and recommendations to assist in the decision-making process.

As e-invoicing continues to evolve, organizations that adopt a strategic, forward-thinking approach and solutions will be well positioned to navigate the regulatory complexities while driving efficiency and growth.

Sustainability advocates are assessing changes that the new administration of President-elect Trump, due to take office in January, may make in U.S. environmental policies. Concerns include potential withdrawal of the United States from the Paris Climate Accords, cuts to investments in renewable energy, and changes in enforcement of climate-related reporting at the federal level.

The sustainability outlook is further clouded by limited outcomes at COP29. The UN Climate Change Conference was held in November in Azerbaijan, the third petrostate in a row to host the annual event (following the UAE in 2023 and Egypt in 2022).

All is not lost, however: This state of affairs offers an opportunity for Europe to strengthen and expand its role as a sustainability leader. The EU should seize this moment to reinforce its commitment to sustainability and spark a global renewal of the climate agenda.

The need for climate action is growing more urgent by the day. Scientists at the Copernicus Climate Change Service have predicted that 2024 will be the hottest year on record and the first calendar year in which global temperatures will have warmed 1.5C above pre-industrial times. Scientists warn that, after this threshold is crossed, Earth may reach the tipping point at which the catastrophic effects of global warming cannot be averted.

The European Green Deal

The ambitious goals of the EU’s Green Deal aim to make Europe the first climate-neutral continent by 2050. The EU now has a chance to double down on these efforts and lead by example. By investing in renewable energy, promoting sustainable manufacturing and agriculture, and driving social sustainability initiatives, Europe can not only reduce its carbon footprint but also create a robust, future-ready, and sustainable economy.

Such leadership can inspire other regions to follow suit, fostering global collaboration in the fight against climate change, wider environmental damage, and the deepening societal divide.

Europe’s diverse landscape allows for a variety of innovative approaches to sustainability. From Germany’s Energiewende (energy transition) to Portugal’s solar energy projects, Finland’s circular economy strategy, and Denmark’s wind energy initiatives, there’s a wealth of knowledge and experience that can be shared and expanded upon. Businesses — in collaboration with each other and innovative start-ups — must lead the way, while politicians should continue to build investment security via concise and reliable regulatory frameworks.

Digital Technologies for Sustainability

A crucial element in achieving sustainability leadership is the deployment of digital technologies, including:

• IoT and AI to optimize energy use, reduce waste, and improve the efficiency of supply chains
• Digital platforms and automation to facilitate greater transparency in environmental reporting and compliance, ensuring that sustainable practices are maintained and improved
• Geospatial intelligence combined with AI to enable climate adaptation and help to manage climate risk
• Digital twins supporting R&D and innovation processes to develop new, sustainable business models as well as approaches to enable reverse logistics, remanufacturing, and recycling of products and materials

By embracing these technologies and driving innovation initiatives, Europe can enhance its sustainability performance as well as serve as a beacon for other regions looking to adopt similar practices.

Tech vendors have an opportunity to support these developments and benefit in the medium and long term. We predict spending on ESG sustainability tech products/services in EMEA to grow by 19% on average over the next five years, reaching $104 billion in 2027.

To gain a share of this market, tech vendors should innovate responsibly and sustainably, keeping in mind the impact of technology itself (e.g., the energy consumption of AI use) as well as the impact of technology use cases (e.g., downstream Scope 3 emissions resulting from the use phase of products or services).

In conclusion, the results of the U.S. elections present a unique opportunity for Europe to strengthen and solidify its role as a global sustainability leader. By continuing to innovate and invest in sustainability technologies, Europe can pave the way for a more sustainable future for all — while at the same time establishing the conditions for future growth. The current headwinds can be transformed into future tailwinds for European business and economy.

For more information on the tech vendor opportunities, watch our latest webcast: Sustainability Headwinds: Re-Energizing Your Momentum for the Sustainability Tech Opportunity.

Katharina Grimme - Associate VP, Research and Practice Lead, EMEA Sustainable Strategies and Technologies - IDC

Analyst Profile
Katharina Grimme has more than 20 years' experience as an industry analyst and strategy consultant in the tech industry and is leading is leading IDC's Sustainability research in EMEA. With her expertise and passion for sustainable concepts for business, society, and digitization, she drives thought leadership at the intersection of sustainability and digital transformation.

We have just released our latest report, highlighting 10 critical predictions for CIOs worldwide. As we look toward 2025, the pivotal role of technology in driving business success in Europe has never been more apparent. 
In a new era of rapid technology-driven transformation, CIOs must be at the forefront, managing new cybersecurity threats while navigating the fundamental uniqueness of AI innovation and the complexities of evolving regulations.

The Unprecedented Imperative

As European organizations head into an uncertain future, they are facing unprecedented challenges and opportunities. The rapid evolution of AI technologies, coupled with increasingly stringent regulatory requirements and political uncertainty, is reshaping the landscape in which businesses operate. With data privacy laws expanding, particularly in Europe, and the growing demand for responsible AI, CIOs are being called upon to not only drive business advantage but also to ensure that innovation aligns with ethical standards and compliance frameworks.
These shifts require CIOs to adopt a more strategic role, balancing the pursuit of organization-wide innovation with the need to manage risk and maintain regulatory compliance. According to our research, by 2025, over 85% of organizations will formalize AI governance policies to align with business goals, a clear indication that the governance of emerging technologies is a top priority.

Increasing Responsibility Demands a Different Approach

Looking ahead, the role of the CIO is expected to expand even further. The increasing threat landscape is driving organizations to diversify their cybersecurity strategies, with 55% of CIOs expected to broaden security measures by 2026 to protect against new and evolving threats and attackers. Additionally, by 2027, we predict that 65% of CIOs will be directly responsible for integrating sustainability goals into technology projects, reflecting the growing importance of environmental, social, and governance (ESG) considerations.
These predictions highlight the need for CIOs to stay agile and proactive. The focus is not only on driving business success through technological innovation, but also on aligning these initiatives with longer-term strategic objectives, such as eliminating legacy infrastructure, introducing new skills, and developing the workforce to harness newly available opportunities. The ability to navigate this complex environment will differentiate successful organizations from those that struggle to keep pace.

Opportunities for CIOs in 2025

The future presents a few opportunities for CIOs to drive strategic changes within their organizations:
• Stay Abreast of the Evolving Regulatory Landscape: For multinational enterprises, navigating the patchwork of regulations across Europe and beyond is increasingly complex. By 2025, half of the G1000 will struggle with divergent regulatory changes that could hinder AI innovation. These changes require CIOs to adopt robust compliance strategies, ensuring that their technology deployments are aligned with both local and international standards.
• Technical Debt Reduction: By 2025, 40% of CIOs will prioritize initiatives to reduce technical debt, leveraging modernization efforts to gain a competitive edge. This shift will enable faster time-to-market and greater operational efficiency.
• Moving Beyond AI Experimentation: This means shifting from pilot projects to implementation, where AI drives tangible business outcomes. By focusing on the ROI of AI investments, CIOs can guide the organization towards unlocking real value, streamlining operations, and gaining competitive advantage. The key will be to transition from isolated tests to integrated AI strategies and platforms across and with ecosystem owners.
• AI and Cyber Resilience: As AI becomes integral to incident management, organizations that effectively integrate AI-infused applications will significantly improve their resilience. By 2027, only half of organizations will fully leverage AI for proactive incident detection, highlighting a significant area for CIOs to focus on.
• Strategic Workforce Development: With 80% of G1000 CIOs expected to be hired from outside their current organizations by 2028, there is a clear trend toward bringing in fresh perspectives and skills to lead digital transformation. This represents opportunities for CIOs who can demonstrate increased business value and risk reduction early. Across Europe, upskilling and reskilling current teams will be crucial to maintain competitiveness.
• Shift Sustainability from Corporate Buzzword to a Strategic Imperative: By embedding sustainability goals into technology projects, CIOs can drive both cost efficiencies and stimulate brand loyalty across Europe. The push toward ESG integration is not only about compliance reporting but also about future-proofing organizations against environmental and societal risks.

The 10 Predictions for 2025

1. Regulatory Complexity: By 2025, 50% of the G1000 will face challenges adapting to divergent regulatory changes, impacting their AI strategies.
2. AI Governance: By 2025, 85% of organizations will formalize AI risk management policies to align with business goals.
3. Technical Debt: By 2025, 40% of CIOs will focus on reducing technical debt for competitive advantage.
4. AI Experimentation: By 2026, over one-third of organizations will need to move beyond experimental AI projects to realize ROI.
5. Responsible AI: 80% of CIOs will establish roadmaps for responsible AI by 2026.
6. Cybersecurity Expansion: 55% of CIOs will diversify security strategies by 2026 to address new threats.
7. Sustainability Goals: By 2027, 65% of CIOs will embed sustainability into technology projects.
8. AI-Infused Incident Management: By 2027, only 50% of organizations will fully leverage AI for incident management.
9. CIO Hiring Trends: 80% of G1000 CIOs will be hired externally by 2028, emphasizing the need for digital innovation and strategic leadership skills.
10. Bridging the Skills Gap: By 2028, 50% of G1000 will adopt tools to address digital and AI skills shortages.

Recommendations for CIOs

To successfully navigate these trends and drive organizational success, CIOs should consider the following strategies:
• Invest in AI and Automation: Focus on scalable AI solutions that deliver clear ROI and enhance operational resilience.
• Prioritize Technical Debt Remediation: Embed debt reduction into digital roadmaps to accelerate innovation and efficiency.
• Develop a Strong Compliance Framework: Align technology initiatives with global regulations, particularly around AI governance and data privacy.
• Embrace Sustainability: Integrate ESG goals into all technology projects to enhance both environmental impact and operational efficiencies.
• Focus on Workforce Development: Upskill existing talent and leverage low-code platforms to close the digital skills gap.
• Strengthen Cybersecurity: Diversify security strategies to protect against evolving threats, ensuring both resilience and compliance.

As we move into 2025 and beyond, the role of the CIO is more critical than ever. By aligning technology initiatives with strategic business objectives and embracing a proactive approach to regulatory compliance, sustainability, and workforce development, CIOs can position their organizations for sustained growth and success in a rapidly changing digital landscape.

As we stand on the brink of a new era in energy, a surprising shift is taking place in the tech world, one that is raising eyebrows: Hyperscalers are turning to nuclear power.

Yes, nuclear power. Use of this energy source, often associated with controversy and disasters, is being considered by Big Tech to meet its enormous AI-driven power needs while staying on track with net-zero goals. Major players like Google, AWS, and Microsoft are exploring nuclear as a way to support their ambitions in AI.

The rapidly rising energy needs of datacenters worldwide could surpass 1,000TWh by 2026 — a figure roughly equal to Japan’s total electricity use, according to the International Energy Agency (IEA). In Ireland, datacenters already strain the national grid, consuming around 21% of the country’s electricity.

As AI usage continues to expand, these energy demands are set to intensify, pushing hyperscalers to consider nuclear as a stable, high-capacity option.

In this way, the rise of AI is not just a technology trend — it’s a driving force in the energy transition, reshaping the power requirements of datacenters and challenging traditional energy sources.

But this AI-driven shift raises a critical question: Are hyperscalers truly prepared to handle the complexities and safety requirements of nuclear energy?

Balancing Sustainability with AI Power Needs

For hyperscalers, AI is creating an unprecedented demand for energy. Generative AI (GenAI), in particular, can use up to 33 times more energy than traditional software for a single task.
Given this surge in energy demand, hyperscalers face a major dilemma: how to secure a reliable power supply that aligns with their sustainability commitments.

Expanding grid connections to meet this demand is not a viable solution in many instances. In the U.S., for instance, about 1.5TW of generation capacity, mainly from low-carbon power sources such as solar and wind, is waiting for grid access. This backlog underscores the growing strain on the grid and the challenge of meeting rising energy demands in a sustainable manner.

In response to these challenges, hyperscalers are looking at restarting existing reactors already connected to the grid, as well as at the potential of off-grid small modular reactors (SMRs), which are faster to build and, according to proponents, safer.

However, a key question persists: Will nuclear power truly meet hyperscaler needs in a sustainable way — or will it cause more problems than it solves?

Why Nuclear?

Nuclear power offers reliable, low-carbon energy 24 x 7. A steady power supply is vital for datacenters, which need to operate continuously. Unlike solar or wind power, which depend on weather conditions, nuclear energy can provide power without interruptions.

For hyperscalers, reliability is crucial. A power failure at a datacenter could lead to major financial losses and service disruptions — making nuclear power’s dependability especially attractive.

Examples of hyperscaler investments in nuclear energy include:

  • Google has partnered with Kairos Power to install SMRs, with a target of 500MW of capacity by 2035.
  • AWS is working with Dominion Energy and X-energy on SMR projects that could provide up to 5GW by 2039.

Is nuclear energy as clean and safe as it needs to be? Opinions on nuclear safety are still divided. Our World in Data says nuclear is among the safest energy sources, with just 0.03 deaths per terawatt-hour, much lower than coal or oil. It’s also one of the cleanest, producing only six tons of CO2 per gigawatt-hour.

However, many members of the public continue to have serious concerns about nuclear safety, especially in countries like Germany and Japan, where memories of nuclear incidents remain fresh.

Risks and Complexities

Nuclear energy projects often face delays and budget overruns. SMRs promise lower up-front costs, but their economic viability is still unproven in practice. NuScale, the first U.S. company to gain SMR design approval, recently cancelled its first commercial project due to unexpected costs. With just two SMR designs in commercial operation so far, their ability to meet both cost and performance expectations remains largely untested.

There are also safety and security challenges. Relying on imported uranium (20–30% of which comes from Russia) may be risky geopolitically. Additionally, nuclear sites can be vulnerable to cyberattacks. A recent court case against the Sellafield nuclear waste site in the U.K., for instance, exposed cybersecurity weaknesses that could have had serious consequences.

For those uneasy about nuclear energy’s history and the associated security and safety concerns, the risks may be difficult to ignore. And with a history of budget overruns and regulatory obstacles, can nuclear realistically meet the short timelines hyperscalers need for their AI-driven power demand?

Hyperscalers as Energy Companies

The bottom line: As hyperscalers move toward nuclear power, they start to look more like energy suppliers than traditional tech firms. Building off-grid nuclear plants, investing in energy infrastructure, and complying with new regulatory requirements are pushing them into unfamiliar territory. But they may have little choice.

The Way Forward

Where does it all lead? Hyperscalers that want to move into nuclear energy face a tough decision. On the one hand, nuclear power might provide the energy they need to support AI’s growth without compromising low-carbon goals. On the other, such a step brings significant risks and challenges that go far beyond their core business.

The hyperscaler shift to nuclear could mark a new chapter in which Big Tech becomes deeply involved in energy transition policy and infrastructure. Whether this will lead to a more sustainable future is uncertain — but the decision could set a precedent that others will follow … or at least learn from.

Learn More
Curious about the energy transition? Discover IDC’s new Worldwide Energy Transition Strategies program, which builds on our utilities research to explore how this evolution impacts various industries.