Rolling pockets of chaos and an overall cloud of uncertainty may be the best way to describe the first two months of the new Trump administration. One upside to federal contracts is that they tend to be long-term in nature, which provides some stability for all types of vendors with existing contracts. However, the current transition has been rocky, to say the least, as contracts are getting canceled, agency staffing is reduced, and the existence of entire agencies is called into question.

The revenue generated from generative AI (GenAI) offset some of the impact of cost-saving and expense-reduction efforts that defined the IT and cloud market in 2024. We expect some of that luster to fade in 2025, however, as the lack of a clear ROI from GenAI solutions will be a sticking point that slows investment in the coming year.

Whether due to existing legacy investments, divisional or regional nuances, or acquisition and divestiture activity, heterogeneity will remain in most IT environments. At one point, the benefits of public cloud made organizations consider a homogeneous, fully cloud-based IT delivery strategy, but those visions have faded for most. The challenge — and goal — is to embrace the hybrid heterogeneous approach and find the best way to integrate, manage and optimize services across these diverse sets of delivery methods and assets. Colocation data centers play a critical role for customers, offering a hybrid approach to facilities and in the interconnection of cloud and on-premises services.