NTT Data managing director, applications solutions ANZ on why AI is not another “SKU to sell”

Tal Nathan explains how MSPs and partners can gain the most economically from AI.

One of the biggest mistakes channel leaders can make with the current AI opportunity is treating it as just another software SKU to sell, according to Tal Nathan, managing director, application solutions, ANZ, NTT Data.

Speaking to CRN Australia, Nathan noted that the real opportunity isn't in the tool itself — it’s in the readiness gap.

“We know from our research that while everyone is buying tools, only 15 percent of organisations globally qualify as 'AI leaders' who are actually seeing profit from them,” he said.

In the NTT Data 2026 Global AI report, these leaders report significantly higher revenue growth and profit margins than other organisations.

For the channel, Nathan said the gold mine lies in the repetitive administrative work that happens before a single prompt is written. It’s about helping clients build the foundations: data governance, cloud infrastructure, and security frameworks.

“In our own Proof of Concepts (POCs), we’ve found that technology is often only 10 percent of the effort; the other 90 percent is fixing the underlying data infrastructure and aligning governance,” he said.

“Channel leaders who can guide clients through that foundational heavy lifting — rather than just selling licenses — will become indispensable strategic partners rather than just vendors.”

To get economic value from AI, Nathan explained that partners and MSPs need to move away from purely transactional models and look toward outcome-based gain-sharing.

“The 2026 Global AI Report shows that top-performing AI leaders are far more open to these collaborative commercial models because they accelerate value,” he said.

“To get economic value, MSPs must help clients avoid the pilot trap. We see so many businesses stuck running endless experiments that never scale — in fact, our data suggests only a small percentage of POCs progress to full-scale implementation without the right help.”

The economic value for an MSP comes from helping a client move from surface-level 'bolt-ons' to 'core reinvention' — rebuilding core applications with embedded AI, according to Nathan.

“When you embed AI into the client’s core workflow, you move from keeping the lights on to driving their revenue growth. That is a much stickier, higher-value relationship,” he said.

Watch out for the hype cycle

Nathan explained that the hype cycle is a “double-edged sword”.

“The biggest challenge is managing the expectation that AI is a magic wand, while dealing with the reality of 'technical debt' and 'pilot purgatory’,” he said.

“We see a lot of fragmentation — different business units buying their own SaaS AI tools, creating overlapping costs and security risks.”

Channel leaders are often caught in the middle of this chaos, Nathan noted.

“They have to navigate the complexity of cloud costs (FinOps), which are often underestimated in AI deployments,” he said.

Furthermore, Nathan added there is the challenge of data sovereignty.

“As AI scales, Australian organisations are increasingly concerned about where their data lives and how it is governed,” he said.

“Our report indicates that cross-geography data privacy is a top governance concern for leaders. Channel leaders who ignore the complexities of sovereign and private AI infrastructure risk leading their clients into compliance minefields.”

Untapped opportunities

Nathan highlighted that the 'human-centric' approach is a massive, untapped opportunity.

“Too many people are focused on AI replacing jobs, but the real value is in augmentation,” he said.

“There is a huge service opportunity in helping organisations redesign their workflows to keep the 'human in the loop'.”

Looking at opportunities, Nathan sees agentic AI as “high value”.

“Helping clients deploy these agents to automate back-office workflows or enhance front-office customer service is where we see the immediate ROI,” he said.

“Additionally, becoming a specialist in 'governance-as-a-service' is critical. With 71 percent of APAC organisations lacking a formal Gen AI policy, partners who can come in and establish the ethical and security guardrails will win the market.”

Observing the current landscape, Nathan said we are at a moment that feels very similar to the early days of the internet in 1999.

“Some are dismissing it as hype, and others are frantically trying to catch up. But the technology alone won't save you,” he said.

“If there is one takeaway, it’s that successful AI adoption is a human transformation as much as a technical one. You cannot just deploy the tech; you have to bring your people along for the journey.

“The organisations that will win in 2026 are the ones that combine bold vision with the discipline to build proper foundations—data, governance, and culture,” he ended.