Five tech trends to reshape Australia's digital future

Interactive has set out five technology trends it expects will shape Australia's digital economy in 2026, spanning industry collaboration, skills-driven consolidation, cloud sovereignty, AI adoption and the impact of social platforms on families.

Alex Coates, Chief Executive Officer at Interactive, linked the trends to shifts in trust, data management, collaboration and everyday use of AI in business.

"As a leader in the technology sector, and as a parent, I see firsthand how quickly technology is reshaping our lives in Australia. Our economy, our skills base, and the way Australians work is changing rapidly," said Alex Coates, Chief Executive Officer, Interactive.

Coates said the coming year would bring changes in how organisations approach data location and access, how suppliers work with each other, and how leaders frame AI-related change across their workforces.

Collaboration shift

Coates expects a stronger emphasis on collaboration across Australia's technology sector. She pointed to more homegrown innovation and greater regional inclusion. She also cited government support as part of the environment for partnerships.

She argued that collaboration could extend even to direct competitors, and she described partnerships as a more prominent driver than acquisitions in the near term. She also said vendors would increasingly align around shared problem solving.

"In 2026, we'll see more homegrown innovation, and there is optimism for greater regional inclusion. We can also expect a genuine shift toward collaboration within Australia's tech industry, with support from government too," said Coates.

"Embracing collaboration, even with competitors, unlocks the ability to tackle challenges together and deliver better outcomes for customers. Partnerships, not acquisitions, will shape the next year and beyond, and we'll see the emergence of vendors looking to solve problems together," said Coates.

Skills and M&A

On consolidation, Coates framed the next wave of deals as centred on access to expertise rather than workforce reduction. She said companies would move to buy skills when internal development could not keep pace with demand.

She described digital roles as increasingly multidisciplinary. She said this trend would push organisations to acquire specialised expertise as customer expectations evolve.

"This next wave of tech consolidation won't be about stripping out jobs. The real story is capability. If organisations can't build the skills required fast enough, they'll simply buy them. With digital roles becoming increasingly multidisciplinary, companies are acquiring specialised expertise to keep pace with customer demand," said Coates.

Cloud sovereignty

Coates also expects cloud decisions to tilt further towards sovereignty. She said boards would treat data location and access as strategic questions rather than narrow compliance issues.

She said organisations would seek more clarity around where data sits and who can access it. She also said boards would review reliance on hyperscale providers and move critical workloads onshore.

"Next year, data sovereignty will move from a compliance question to a strategic one. Organisations want clarity on where their data sits and who can access it. We're seeing a real reset in trust," said Coates.

"Boards are rethinking hyperscale dependence and moving critical workloads onshore. Sovereign cloud is becoming the simplest and safest default," said Coates.

AI adoption

Coates expects a shift in how organisations describe their AI posture. She contrasted being "AI-first" with becoming "AI-native". She said structured data, cyber resilience and workforce learning would sit at the centre of that transition.

She also said AI literacy would become a baseline expectation across organisations. She argued that leaders would stand out through how they mix human judgement with AI tools, rather than through the breadth of automation programmes.

"AI is where the internet was in 1999 - everyone's hyped, but a sparing few know how to harness the potential. Becoming AI-native starts with structured data, cyber resilience and a workforce willing to learn," said Coates.

"In 2026, AI literacy will become the new digital literacy. Leaders will be defined by how well they combine human judgement with AI capability, not by what they automate," said Coates.

Social platforms

Coates also highlighted pressure on social platforms and the role of families, schools, governments and technology companies. She referenced the debate about restricting social media and argued that policy alone would not resolve the issue.

She said parents and leaders should model behaviours and normalise time away from screens. She said responsibility would sit across multiple groups.

"As leaders and as parents, we need to step up. The much-discussed social media ban makes one thing clear to me - you can't legislate good parenting. We need to model the right behaviours, talk openly about online risks, and create environments where being off-screen is normal. Tech companies, educators, governments and parents will all share responsibility," said Coates.

Coates said 2026 would be a pivotal year for Australia's digital economy and she expects organisations to focus on trust, capability, data protection and workforce readiness as these trends play out.