In the last three decades, it is fascinating to see how the IT industry evolved driven by major technological innovations and new developments, leading to paradigm shifts. Artificial Intelligence (AI), the Internet of Things (IoT), and cloud computing are today’s reality of technological advancements.

As analyzed by research companies, global spending on IT services is projected to reach USD 1.6 trillion in 2025, with a 9% growth rate. IT services remain a core segment in the IT industry. The global tech industry growth rate looks promising in the coming years; yet, it has several challenges to be dealt with.

New Developments and Trends in the IT Industry
Tech services, hardware engineering, software development, and telecom services are key facets of the IT industry showcasing numerous developments. We’ve already seen how we perceive the world differently due to the miracle of the latest technologies, such as AI, blockchain technology, Augmented Reality (AR), Virtual Reality (VR), Machine Learning (ML), etc. The cloud-based services and solutions, such as Software as a Service (SaaS), Platform as a Service (PaaS), and Infrastructure as a Service (IaaS) are booming.
- Wide integration of 5G technology and rapid expansion of IoT-enabled devices for fast connectivity and real-time data exchange
- Rise in the number of tech startups and small & business enterprises (SMEs) presence in the IT industry.
- Increasing adoption of AI and automation across business sectors, especially the manufacturing sector
- Significant investment growth in IT innovation and research & developments
- Wide-open opportunities to tap into tech-savvy remote workforce across the globe
The rapid adoption of advanced technologies and innovations in the tech industry is boosting business opportunities across diverse sectors, including finance & banking, healthcare & pharmaceutical, telecom, renewable energy, education, manufacturing, and more. We’ve seen the major impact of technology developments on every industry. The rising popularity of several industry segments such as fintech and ed-tech is a key example of the growing integration of new technologies across different business sectors.
Major Challenges the IT Industry in 2025
Technically speaking, IT companies face numerous challenges in 2025 that hamper their operational performance and productivity, becoming roadblocks to their overall business growth. We’ve listed five major challenges that every tech company must know how to address these problems.
- Cybersecurity issues: Increasing data breaches due to malware attacks are a big threat to any organizational setup and preventing data breaches is a key challenge for many firms today. Businesses must set up robust encryption protocols to safeguard sensitive information and data from unauthorized accessing computer systems and networks.
- Strict regulatory compliance: Stringent regulations for data protection and privacy concerns like GDPR and industry-specific ones are major challenges for IT firms. Additionally, tech companies must comply with the existing laws regarding consumer protection, such as CCPA. Complex compliance regulations from one country to another pose a big issue that impedes the IT sector’s growth.
- Scarcity of skilled IT professionals: Getting more talent who keeps abreast of new technologies and tools remains a crucial problem in the tech industry. Finding skilled IT professionals with specialized skills in advanced technologies, like cloud computing, AI/ML, blockchain, and AR/VR is a big headache for tech companies.
- Budget constraints: Limited financial resources for innovations and technological developments is a key problem for many companies. To address budget constraints, businesses require project prioritization, ROI assessment, and strategic planning to optimize operational costs. Strategic allocation of your financial resources is a key to sustainable business growth.
- Better customer experience: Providing a better customer experience is a key focus and major challenge for every IT company. To meet ever-evolving customer preferences and expectations, tech companies must improve digital interaction platforms and work toward robust IT infrastructure. Providing the right level of customer service and satisfaction can be challenge. You can partly overcome this using better interaction tools, which are user-friendly for diverse users.

Building Remote Tech & Service Teams as an Effective Solution!
Building remote teams still makes sense for various tech companies aiming for cost-effective business operations. Many tech companies prefer building remote teams in foreign countries, especially developing economies due to the abundant availability of highly skilled professionals and cost-saving advantage. These are some key reasons encouraging small & medium-sized IT companies to increase their overseas market presence.
Building remote teams or hiring contractors for remote work is nothing new to the IT industry and many tech companies took advantage of working remotely even before the onset of COVID pandemic. Today, technology advancements such as cybersecurity, cloud computing, IT consulting, and technical support make remote work easy for IT-related services.
Quality assurance, software development, IT project management and quality testing are major IT-related business functions done remotely. Many tech companies often remotely hire software developers, software engineers, quality engineers, IT project managers, cloud architects, and system analysts, which is an easy way to tap individuals with best skills in an affordable way.
Let us list some major benefits of having remote teams to address various issues associated with the tech industry.
- Hiring the best IT talent: IT companies can easily tap into a spread out and global talent pool and hire the best talent who can rightly fill in the skill gap. Expanding your search in different geographies means you have a better chance to build a team with specialized skills and the right talent.
- Reduced cost: Budget constraint issues can be solved when you build a team with people who prefer to work remotely or with in a country with lower labor and living costs. This helps to substantially reduce the employment cost of the IT talent and get the job done without compromising on the quality.
- Easy to set up customer support centers: Having customer support centers in a less expensive areas will help you save costs and ensure a better customer experience at the same time. Additionally, you can extend service hours and provide multilingual support, taking advantage of different time zones.
Advantages of EOR Services for Building Remote Teams in India
When we say remote team building, some services like ‘outsourcing’, ‘contracting’, and ‘subsidiary formation’ may come to your mind. Over the last two decades, IT outsourcing has been a popular option for many tech companies aiming to operate key business functions remotely. Also, India remains one of the most attractive destinations for IT outsourcing services.
On the other hand, employer of record (EOR) is another business model that provides the most cost-effective service for team building in India. Unlike IT outsourcing services, EORs help you build a remote team in India with better control and management of your employees. Let’s explore the advantages of having remote teams in India.
Two major advantages of building remote teams in India for IT companies are as follows:
- You can easily access and hire tech-savvy Indian talent as the country has a vast talent pool.
- Hiring tech talent in India can be cost-saving as you can hire them at a reduced cost compared to many Western countries.
However, one major challenge you’re more likely to face when expanding a team in India is to navigate regulatory compliance. It means you must comply with the existing laws and regulations for hiring and employing remote professionals in India.
India has a complex set of employment laws and regulations and handling such legal procedures can be daunting if you’re entering the Indian market for the first time. Even for many old players, navigating Indian employment laws can be tough.
Then, you may ask, “How do I go about it?” The answer is simple, you can use EOR as it enables you to build and operate an Indian team with zero legal complications. Let’s understand the major benefits of using EOR services when IT companies expand a team in India.
- Regulatory compliance assurance: EORs ensure that your business operates in the Indian market in compliance with the existing Indian labor laws and employment regulations. An EOR handles compliance matters related to payroll, tax withholdings, and other legal responsibilities a foreign company must comply with when operating in India. In other words, EORs shield you against compliance risks.
- Cost-effective operation: Partnering with an EOR, you can take advantage of cost-saving operation since you are not required to form a legal entity in India. Your EOR partner will be a local guardian of your Indian team, handling all legal requirements for your employees. This means partnering with an EOR enables you to save from upfront investment costs required in setting up a legal entity.
- Talent acquisition: Your EOR partner helps you find the best talent from a large pool of skilled IT professionals in India. EORs have well-established networks and extensive local knowledge that can assist businesses in recruitment. They scout, screen, and shortlist the Indian candidates who can rightly fit your requirements.
- HR service supports: EORs provide a range of human resource (HR) service supports, leading to better management of your remote workforce. In addition to onboarding and offboarding, an EOR handles employee benefits like medical and insurance benefits, leave/attendance, and retirement plans of your remote employees. Simply put, better employee management means reducing turnover risks and enhancing productivity.
Advancements and innovations expected to dominate in 2025
Quantum computing: Quantum computing will be increasingly used to solve real-world problems faster, aided b y new encryption methods.
Generative AI: This AI can produce new content, such as realistic visuals and digital copies, and can automate tasks, give customized responses, and boost creativity.
Edge computing: Processes data closer to the source set to reduce latency and improves real-time processing.
Artificial Intelligence: AI-powered systems will become more capable of performing complex tasks in many domains, including healthcare, finance, transportation, and entertainment.
Sustainability: Companies will use IoT, AI, and blockchain to improve sustainability in supply chains, waste management, and energy grids.
Blockchain: Blockchain technology may become more widespread, and more businesses may use it to improve operational security and transparency.
Extended reality (XR): XR technologies, which include virtual reality (VR), augmented reality (AR), and mixed reality (MR), will become more immersive and offer enhanced experiences in gaming, education, healthcare, and beyond.
Cybersecurity: Cybersecurity Mesh is a critical trend as cyberattacks become more sophisticated.
Conclusion
Businesses across various sectors are integrating advanced technologies to stay ahead of the competition and enhance productivity. With the rising demand for automation and embracing digitization in the corporate world, the importance of the IT industry has become more evident. However, tech companies still have challenges, like a shortage of IT talent, compliance regulations, and budget constraints, which are roadblocks to business growth. Building remote teams is a solution to address the challenges facing the tech industry. It’s due to several benefits, such as easy access to talent, lower costs of hiring employees, and cost-saving in business operations. Using EOR services will make your team-building and business operations in India easy as your EOR partner will handle tasks, such as compliance assurance, talent acquisition, and HR functions of your employees on your behalf.
Covered By: NCN MAGAZINE / IT Industry
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