In the AI Vendor Race, Strategy Trumps Speed — Gartner Warns Tech Providers

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6. In the AI Vendor Race, Strategy Trumps Speed — Gartner Warns Tech Providers

As AI reshapes global industries, from finance to healthcare, logistics to energy, the Middle East’s tech ecosystem finds itself at a pivotal crossroads. With regional governments investing billions in AI-driven transformation, and private sector players racing to integrate AI into core operations, the question is no longer whether to compete in the AI race — but how.

According to a recent Gartner report, the path to AI leadership is getting increasingly complex, requiring more than just rapid product launches or flashy GenAI features. In a series of new insights, the advisory firm lays out a sobering message for tech providers in the region and beyond: the AI race is not just about speed, it’s about strategic clarity, adaptability, and delivering real business value.

“The AI vendor race is not a single race with a clear finish line, but rather a series of overlapping competitions, where the endgame can range from market leadership to technological breakthroughs, or simply maintaining relevance,” said Anthony Bradley, Group Vice President at Gartner.

Beyond First-Mover Advantage

While many vendors are focused on fast deployment and headline-grabbing AI capabilities, Gartner warns that these efforts are often misaligned with long-term success. The research firm stresses that the race is not just about launching the next large language model (LLM) or plugging GenAI features into existing platforms. Rather, it requires a nuanced understanding of the entire AI tech stack and the ability to navigate a dynamic, often unpredictable competitive field.

“Vendors must pay close attention to the frequent shifts in the market to gain advantage and protect their position,” Bradley said. “It requires an understanding of competitor capabilities and their demonstrated and likely moves in the race. Vendors must also have a deep understanding of AI adoption behaviors and how they’re positioned in the race against competitors to meet or even drive demand.”

According to Gartner, the AI vendor race includes long-established players, AI-native startups, and emerging entrants, all facing intense pressure to produce and scale AI innovations at unprecedented speed. However, speed alone won’t determine winners.

“Winning will require crystal clarity on where you’re headed and what stands in your way — and the confidence to snatch opportunities when you can,” Gartner advises.

GenAI is a Rapidly Evolving Battlefield

The generative AI market, in particular, is maturing at breakneck speed. Gartner estimates that GenAI model revenues will soar by 149.8% in 2025, exceeding $14 billion. By 2026, GenAI capabilities will become a baseline expectation across all software categories, and by 2028, the market is expected to stabilize at an annual growth rate of 38%. 

Meanwhile, AI-optimized server demand is projected to grow by 90.9% in 2025, and by 2027, nearly all premium computing devices will be AI-enabled.

For vendors, this means that differentiation through GenAI will become harder and more short-lived.

“Providers must pivot from functional, use-case-oriented AI to approaches that deliver real business outcomes tied to mission-critical initiatives,” Bradley added. “Less than one in five GenAI projects will achieve their desired business value through 2026. To close this gap, product leaders need to integrate targeted business outcomes into product engineering, marketing, and implementation. Those who fail to make this shift will not remain competitive.”

A Strategic Blueprint

Gartner outlines four core strategies for vendors aiming to thrive in the AI vendor race:

• Stay alert to shifting dynamics: Constant market scanning is critical. Providers must track not only direct rivals, but also adjacent players and ecosystem partners whose moves could reshape their trajectory. Strategic agility is key.
• Balance speed with direction: Innovation without focus is a recipe for wasted resources. Vendors are advised to maintain a disciplined cadence, pursuing initiatives aligned with long-term vision and validated market needs.
• Address obstacles head-on: Technical debt, legacy systems, and constrained resources can erode competitiveness. Gartner encourages providers to modernize infrastructure, eliminate bottlenecks, and build for flexibility.
• Anticipate rather than react: Winning vendors are those that look ahead. Scenario planning, real-time intelligence, and organizational agility are essential tools for staying ahead of disruptions.

Cybersecurity Is the Next Critical Battleground

Looking beyond AI capabilities, Gartner also highlights preemptive cybersecurity as an emerging differentiator in the vendor race. With AI-powered threats increasing in frequency and sophistication, product leaders must now embed robust security directly into their offerings.

Gartner urges tech providers to adopt the “three Ds” of preemptive cybersecurity: deny access through obfuscation, deceive attackers using automated cyber deception, and disrupt threats with predictive intelligence and exposure management.

Failing to address this, the report warns, could expose vendors to both reputational and financial risk.

As countries across the Middle East race to establish AI leadership in the global economy, the Gartner insights offer a timely reminder: success in the AI era won’t come from technology alone. It will come from disciplined execution, clear strategic vision, and the ability to turn innovation into outcomes.