Last year was playtime for AI; In 2025, it’s game time: NTT DATA CEO Abhijit Dubey

Abhijit Dubey, CEO, NTT DATA Inc.

Last year was "playtime" for artificial intelligence (AI), but according to NTT DATA CEO Abhijit Dubey, 2025 will be "game time" as businesses scale AI projects for productivity gains. “We call it playtime is over. Now it’s game time,” he said.

Dubey noted that clients are now moving towards large-scale deployments, with IT services deals becoming increasingly concentrated among a few players in the sector. “We’re seeing what I call a ‘barbell effect’ on deals,” Dubey said.

“We see very large transformation-oriented deals, whether it's take over my core and modernise it, or it's take over my operations and substantially transform it using AI, etc. At the same time, we are also seeing smaller deals, which are much more velocity driven, which is much more discretionary spend oriented around very specific use cases and business problems that AI can solve.”

Dubey, however, emphasised that though clients are becoming a lot more sophisticated in deploying AI for productivity gains, it is yet to have an impact on the company’s income statement or profit & loss statement. “I don’t think we are at that level of adoption and impact yet,” he said.

AI’s impact on data centres

As AI adoption accelerates, NTT DATA’s data center business is seeing significant growth. The company, part of Japan’s NTT Group, has invested over $3 billion in India and plans to spend another half a billion over the next three to four years. India, currently one of the top 10 revenue-generating markets for NTT DATA, is poised to enter its top five within the next three years.

NTT Holdings CEO Akira Shimada underscored India’s strategic importance, citing rapid digital and economic expansion.

“India is key in our global strategy, fuelled by its rapid economic and digital expansion,” Shimada said.

The company, which controls 30% of India’s data centre market, is witnessing surging demand as enterprises migrate to the cloud and integrate AI workloads.

“The world has transformed to digital at a much faster pace than we can build data centres,” Dubey said. “Pre-AI, we were looking at about 15 percent growth in the data centre business globally. Post-AI, that’s added about five to seven points of additional growth.”

The emergence of cost-efficient AI models, such as Chinese startup DeepSeek’s R1, has also benefited NTT DATA. The company specialises in AI inferencing-oriented data centres rather than large-scale frontier model training.

“There's a lot of debate around DeepSeek and the new models that are coming out. My view is that it's actually a net positive. Because effectively what it means is the unit cost economics goes down. It unlocks more demand, especially from enterprises. That should unlock more demand for data centres and in the segment of data centres that we operate in for AI.”

“We don't do massive data centres for frontier model training. We don't do that. That's not the business we are in. What we do is sort of the inferencing oriented in tier one and tier two markets, and especially as unit cost economics goes down, that should be a net positive for us,” he added.

Trump tariffs slowing IT growth

The Donald Trump administration’s tariff war has triggered fears of a potential recession in the market. This has led to uncertainty in the IT services sector, which had just begun to see a recovery in discretionary spending.

Dubey said that the impact has been more pronounced in specific sectors, including manufacturing, automotive, consumer packaged goods (CPG), and retail, adding that the industry will have to "wait and see."

However, he noted that the banking sector is expected to remain resilient and much stronger due to the promised deregulation environment.

“It's not quite clear exactly what's going to be the end state or what the new normal is going to be. And until that gets clear, there will be a period of uncertainty which will automatically reduce the amount of discretionary spends, especially in those areas around supply chain and manufacturing operations, etc.,” Dubey said.

He added, “But the reality is that as soon as that period of uncertainty finishes, there will be a need for reconfiguring the supply chains and technology as a critical part of that. So, the hope is that we get through this period of uncertainty pretty quickly.”

Globally, NTT Group is investing about $59 billion over 5 years from FY23 to FY27 into its growth areas, including data centres and AI. The company hopes to deliver its integrated full-stack proposition to clients across data centres, applications, BPaaS, managed services, cloud, security, and AI solutions.

Also read: NTT DATA commissions $400-mn submarine cable for better data centre connectivity across Malaysia, India, Singapore