Asset Management Infrastructure

Source: PwC Global AWM & ESG Research Centre

While they are distinct, these five forces place remarkably similar demands on infrastructure - from more connected data and greater automation, to stronger governance and operational agility.

There are several reasons as to why asset managers are requesting upgrades from their infrastructure providers:

The industry faces a profitability paradox: assets and revenues keep growing, but profit per AuM has fallen 19% since 2018 and is projected to decline by a further 9.1% by 2030.  

Technology and operations spending by asset managers is growing, yet only a small minority of them have fully integrated their core infrastructure layers. Spending is also tied to the past: only 23% direct most of their technology budget to new capabilities, while 29% spend more than 70% of it maintaining legacy systems. This matters for AI, where data fragmentation and poor data quality (24%) is the single biggest obstacle to deployment at scale.  

The value of infrastructure lies in what it enables:

Investment priorities already reflect this shift. Over the next three years:

As infrastructure becomes embedded in the operating model, dependency becomes strategic. This is most acute when the capability is essential, when it is concentrated among a small number of providers, and when it is difficult to replace – as with market data, custody, fund administration, regulatory reporting and core technology platforms.

Asset managers rank market data (58%), regulatory and reporting systems (47%) and core technology platforms (46%) as the most strategically expensive layers relative to the value they deliver. Critical processes already span multiple providers: for AML and KYC, 34% run hybrid structures and 23% best-of-breed stacks. The relationship is also becoming two-way, with 24% of infrastructure providers using client data as a core input to product development. The question is not whether dependency can be eliminated, but where it creates value and how it should be governed.

Infrastructure decisions now shape growth, innovation and long-term competitiveness, and there is no universal operating model. Asset managers can take inspiration from the following strategic approaches:

Blended models dominate: 44% follow a deliberate combination by capability type, while 21% mainly buy, 18% partner and 13% build in-house. Infrastructure providers are adapting too. Some 35% are evolving into platform or ecosystem partners for asset managers that build capabilities in-house, while 23% are co-developing proprietary infrastructure with selected asset manager clients.  

Rather than converging on a single model, the industry is organising around four infrastructure archetypes, each defined by what firms own and monetise, and each carrying its own structural tension (from fee pressure on asset-based revenue to channel conflict):

Asset managers’ ambitions point towards specialist and digital models: by 2030, 29% aim to compete as specialist modular providers and 24% as digital and tokenisation platforms. Infrastructure providers, meanwhile, see hyperscale cloud providers (68%) and AI-native data platforms (54%) as the most credible emerging competitors. Infrastructure strategy has become business strategy.

These archetypes demonstrate that there is unlikely to be a single optimal model, and that the appropriate position will depend more on individual strategy rather than on a universal preference for ownership or partnership. The firms best positioned for teh future will be those that make deliberate operating-model choices, combining modern technology, trusted data, specialist expertise, and ecosystem partnerships to create scalable, client-centric organisations.