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EY Study: Security Tops the List in Technology Vendor Selection

In an ever-evolving technological landscape, EY's recent global survey sheds light on the changing priorities of businesses when selecting technology vendors. The "EY Reimagining Industry Futures Study 2026" surveyed 1,590 companies from 25 countries across eight industries to understand their technology investment strategies and vendor selection criteria.

Key Findings from the Survey

The findings reveal that nearly 66% of companies either currently invest in or plan to invest in AI agents. Furthermore, 89% of respondents regard technology policy as a vital factor in their investment judgments, alongside 53% planning investments in sovereign cloud solutions.

Security measures and data protection have taken precedence over traditional factors such as cost and functionality in the decision-making processes of these organizations. This trend indicates a rising awareness of cybersecurity concerns, digital sovereignty, and the need for advanced AI capabilities.

Across all industries, analytics and AI emerged as significant areas of investment. The survey reflects a growing urgency for businesses to enhance their technological frameworks not just for operational efficiency but also to safeguard sensitive data amidst rising cyber threats.

Geopolitical Changes Affecting Investment Decisions

The geopolitical landscape significantly influences corporate investment choices. With an emphasis on data protection and digital sovereignty policies, companies are leaning towards these aspects over competitive dynamics. About 81% of survey participants highlighted trade disputes and tariffs as critical considerations in their investment strategies.

Consequently, 77% of businesses are reevaluating their relationships with technology vendors, with long-term investment plans also under reassessment. The findings suggest that geopolitical uncertainties and regulatory transformations are profoundly shaping the technological strategies of companies.

Rob Atkinson, EY UK&I Technology, Media & Entertainment Telecommunications Market Leader, noted, "Various factors, including new policies and regulations related to data management, are assessed during technology investment decisions. The rise of cybersecurity requirements and national digital sovereignty necessitates that service providers swiftly adapt their offerings to meet changing customer demands."

Increased Demand for Sovereign Cloud Solutions

As geopolitical risks rise, businesses' interest in sovereign cloud solutions has surged. While 17% of respondents have already committed to these investments, 53% plan to do so in the near future. The primary reasons for this shift include enhancing cybersecurity, fostering customer trust, and ensuring compliance with national policies and regulations.

Adrian Baschnonga, EY Global Technology, Media & Entertainment and Telecommunications Lead Analyst, commented on the situation: "Transitioning to sovereign cloud is prompting companies to rethink supplier relationships. Service providers entering this market must strategically align with customer business goals while differentiating their own products."

Security as the Primary Consideration in Vendor Selection

The study also highlighted that security is the foremost attribute businesses prioritize when selecting technology vendors. This reflects the growing demands for customer data protection and regulatory compliance.

Notably, vendors who integrate AI functionalities into their services have an edge, as businesses expect rapid, high-quality support and proposals leveraging AI technology. This criterion holds particular significance in sectors like financial services, automotive, and manufacturing.

Atkinson reiterated the importance of security: "B2B customers are increasingly focused on a vendor's track record in security. The emergence of new security-related services such as sovereign cloud and anti-fraud APIs can offer telecommunications companies new growth opportunities."

A Shift Towards Strategic Partnerships

The survey also indicates that the role of ICT vendors is evolving. Companies now emphasize a vendor's understanding of their strategic needs, with 43% citing improved insights into their operational and technological priorities as a crucial area for enhancement.

However, 59% felt that vendors insufficiently communicated their accomplishments in leveraging technology for business transformation. Another 59% highlighted the lack of concrete client success stories as a gap in vendor offerings.

Additionally, 43% of businesses plan to consolidate their vendor relationships within the next 12 months, a rise from 35% the previous year.

Baschnonga stated, "Companies are seeking vendors who are not just technology providers but collaborative partners in executing strategic objectives. The demand for simpler product options, faster responsiveness, and effective consulting capabilities will become essential differentiators for service providers looking to maintain a competitive edge."

EY Japan's Insight on B2B Growth for Telecom Providers

In Japan, telecommunications companies are not rigidly adhering to their core service of providing connectivity. Instead, they are actively expanding into adjacent areas such as AI, cloud, IoT solutions, and cybersecurity, transitioning from mere network providers to comprehensive technology providers.

However, many of these sectors are dominated by US-based tech giants like AWS, Microsoft, and Google. To compete effectively, Japanese telecom providers must leverage national sovereignty, utilize their track records, and strengthen customer relationships.

Government agencies and many organizations in Japan often harbor concerns about data being stored and processed abroad or subject to foreign legal jurisdiction. Telecom companies can offer domestic data centers with sovereign cloud services to address these concerns.

Furthermore, successful execution of advanced technologies and new use cases typically starts with proof of concepts. Possessing a seamless operational structure within the country and showcasing capabilities across their network and customer support can serve as a significant advantage. Building relationships with local businesses and collaborating on development and demonstrations can enhance their competitive positioning.

Ultimately, the construction of a robust ecosystem will significantly influence success rates in the coming years.

Survey Overview

The "EY Reimagining Industry Futures Study 2026" was conducted in November 2025, featuring an online survey across 25 countries and eight industries, targeting 1,590 companies. Respondents were individuals with a solid understanding of their company's advanced technology strategy. The survey examined corporate awareness and investment plans for AI, IoT, and 5G technologies, vendor capability evaluations, and supplier ecosystem relationships.

For further details, refer to the full report on how telecom providers can grow and expand in the B2B sector.