Product Code: 52144
The managed services market was valued at USD 185.98 billion in 2019, and it is expected to reach USD 356.24 billion by 2025, registering a CAGR of 11.5% during the forecast period of 2020-2025. The market for managed services is going to be fueled by the increasing shortage of expertise with business becoming more technology-oriented. Furthermore, Due to rapid digitalization, companies are required to continually innovate and upgrade their infrastructure to remain competitive.
- Managed services allow the business to outsource certain aspects of their IT requirements to a 3RD part Managed service provider. The companies are able to reduce costs, boost productivity, and enhance performance without having to spend time on implementation, maintenance, and upgradation of their IT related infrastructure.
- It is estimated that the year on year capital expenditure by small and medium businesses towards these services will increase by 25%. The market for SMBs and cloud services is expected to take a bigger share, despite the slow growth rate of the overall IT expenditure in SMBs, as per a recent survey conducted by Spiceworks.
- According to the report published by the Technology Services Industry Association (TSIA) as of 2018, about 81% of the MSPs were using commercial off-the-self tools to provide a customized solution to their clients. Also, the focus of the industry is slowly shifting towards standardization of managed services with 68% MSPs offering a standard solution.
Scope of the Report
Managed services refer to a concept wherein an organization's in-house day-to-day management and operation functions are managed by a third party service provider. Managed services involve outsourcing of services related to infrastructure, security, printing, mobility and other functions, while the ownership rights stay with the end-user.
Key Market Trends
Managed Security is Expected to Hold a Significant Share
- The cybersecurity remains an area which has not been addressed adequately by most of the companies, mostly because they do not have the level of expertise required to handle modern-day threats. As per the report published by Hiscox in 2019, almost 74% of organizations have a very novice infrastructure, while only 10% of the organization worldwide have the necessary infrastructure to deal with the cyberthreats.
- The report also mentions that the cost incurred to the cyberattacks have ballooned in the last year alone. The pharmaceutical industry was the worst affected with the average cost incident going up from USD 130,000 IN 2018 to USD 726,000 in 2019.
- The worldwide spending on security-related hardware, software, and services is forecast to reach USD 120 billion by 2022. Rising security threats, regulatory compliance, and fear of data breaches will continue to drive security investments across various industries. Many major organizations are adopting managed security services to help maintain security within an organization.
- Managed security services (MSSs) with advanced threat detection and remediation capabilities are enjoying high adoption rates. Connected devices are further expected to propel distributed denial of service (DDoS), and advanced persistent threat (APT) attacks. Thus, enterprises are seeking more proactive security measures to maintain security within an organization. According to Cloudflare, the financial cost of a DDoS is significant, as falling victim to a DDoS attack can cost an organization around USD 100,000 for every hour the attack lasts. The above factor is fueling the demand for managed security services.
- According to the 2018 report by Kaspersky Lab, the three industries most likely to suffer from a DDoS attack are telecoms, financial services, and IT. On average, large enterprises lose USD 417,000 as a result of a denial of service attack and small and medium enterprises lose USD 53,000. In 2018, around 20% of the companies with 50 employees or more reported that they have been the victim of at least one DDoS attack.
Asia-Pacific is Expected to Witness Rapid Growth
- Asia-Pacific is currently experiencing a high adoption of cloud owing to a large number of organizations moving from traditional business models to cloud-based infrastructure to modernize the organizations business process including a multitenant architecture. Digital transformation has become a top priority in Asia-Pacific, and an increasing amount of companies are implementing formal strategies to support their efforts.
- As more Asian enterprises and government agencies migrate their infrastructure to the cloud, MSPs can provide a variety of services to help these organizations address advanced persistent threat (APT), monitoring, and perform scheduled maintenance.
- Most customers in this region prefer MSSPs that have local security operations centres (SOCs) due to the requirements of data sovereignty and other security compliance regulations released by governments.
The managed services market is consolidated and is dominated by major players. Some of the major players in the market are Cisco Systems Inc., IBM Corporation, Microsoft Corporation, Verizon Communications Inc., Fujitsu Ltd., Dell Technologies Inc., Wipro Ltd., among others.
- August 2019 - AT&T and Dell Technologies jointly planned to exlpore the development of key open infrastructure technology areas for the next-generation network edge that will be required by service providers to support new use cases and service opportunities in a cloud-oriented 5G world.
- January 2019 - Ericsson launched a new AI-based managed services offering for communications service providers, called the Ericsson Operations Engine. The Ericsson Operations Engine proactively and directly addresses service providers' managed services complexity challenges as the industry moves towards an era of 5G and IoT.
- January 2019 - Fujitsu announced that it had entered into a global systems integrator partnership with Microsoft. Three months later (March 2019), it attained the status of global Microsoft Azure Expert Managed Services Provider (MSP).
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Table of Contents
- 1.1 Study Deliverables
- 1.2 Study Assumptions
- 1.3 Scope of the Study
2 RESEARCH METHODOLOGY
3 EXECUTIVE SUMMARY
4 MARKET DYNAMICS
- 4.1 Market Overview
- 4.2 Introduction to Market Drivers and Restraints
- 4.3 Market Drivers
- 4.3.1 Increasing Shift to Hybrid IT
- 4.3.2 Improved Cost and Operational Efficiency
- 4.4 Market Restraints
- 4.4.1 Integration and Regulatory Issues and Reliability Concerns
- 4.5 Value Chain Analysis
- 4.6 Industry Attractiveness - Porter's Five Force Analysis
- 4.6.1 Threat of New Entrants
- 4.6.2 Bargaining Power of Buyers/Consumers
- 4.6.3 Bargaining Power of Suppliers
- 4.6.4 Threat of Substitute Products
- 4.6.5 Intensity of Competitive Rivalry
5 MARKET SEGMENTATION
- 5.1 By Deployment
- 5.1.1 On-premise
- 5.1.2 Cloud
- 5.2 By Type
- 5.2.1 Managed Data Center
- 5.2.2 Managed Security
- 5.2.3 Managed Communications
- 5.2.4 Managed Network
- 5.2.5 Managed Infrastructure
- 5.2.6 Managed Mobility
- 5.3 By Size of Enterprise
- 5.3.1 Small and Medium Enterprises
- 5.3.2 Large Enterprises
- 5.4 By End-user Vertical
- 5.4.1 BFSI
- 5.4.2 IT and Telecommunication
- 5.4.3 Healthcare
- 5.4.4 Entertainment and Media
- 5.4.5 Retail
- 5.4.6 Manufacturing
- 5.4.7 Government
- 5.4.8 Other End-user Verticals
- 5.5 Geography
- 5.5.1 North America
- 22.214.171.124 United States
- 126.96.36.199 Canada
- 5.5.2 Europe
- 188.8.131.52 United Kingdom
- 184.108.40.206 Germany
- 220.127.116.11 France
- 18.104.22.168 Rest of Europe
- 5.5.3 Asia-Pacific
- 22.214.171.124 China
- 126.96.36.199 India
- 188.8.131.52 Japan
- 184.108.40.206 Rest of Asia-Pacific
- 5.5.4 Latin America
- 220.127.116.11 Brazil
- 18.104.22.168 Mexico
- 22.214.171.124 Argentina
- 126.96.36.199 Rest of Latin America
- 5.5.5 Middle East & Africa
- 188.8.131.52 United Arab Emirates
- 184.108.40.206 South Africa
- 220.127.116.11 Saudi Arabia
- 18.104.22.168 Rest of Middle East & Africa
6 COMPETITIVE LANDSCAPE
- 6.1 Company Profiles
- 6.1.1 Fujitsu Ltd.
- 6.1.2 Cisco Systems Inc.
- 6.1.3 IBM Corporation
- 6.1.4 Alcatel-Lucent S.A
- 6.1.5 AT&T Inc.
- 6.1.6 HP Development Company L.P.
- 6.1.7 Microsoft Corporation
- 6.1.8 Verizon Communications Inc.
- 6.1.9 Dell Technologies Inc.
- 6.1.10 Nokia Solutions and Networks
- 6.1.11 Deutsche Telekom AG
- 6.1.12 Rackspace Inc.
- 6.1.13 Tata Consultancy Services Limited
- 6.1.14 Citrix Systems Inc.
- 6.1.15 Wipro Ltd.
7 INVESTMENT ANALYSIS
8 MARKET OPPORTUNITIES AND FUTURE TRENDS