To many observers and IT professionals, managed services are seemingly peaking in 2015. Already, more than 60% of both large and small businesses have integrated some type of managed services in their overall IT strategies. 30% of service providers have experienced increased service use in the last couple of years in payment processing, mobile device […]
To many observers and IT professionals, managed services are seemingly peaking in 2015. Already, more than 60% of both large and small businesses have integrated some type of managed services in their overall IT strategies. 30% of service providers have experienced increased service use in the last couple of years in payment processing, mobile device management, managed communications, Office365, Software-as-a-service, Hardware-as-a-service, managed network security, remote monitoring and disaster management. This has subsequently increased their profits by 25-100%.
Although many businesses are already adopting managed service solutions, the most intriguing fact is that they are barely leveraging them. According to a CompTIA report titled “Trends in Managed Services Operations”, the primary reason for this is “uncertainty” surrounding the cloud. Most users choose to advance sparingly by adopting a hybrid cloud strategies, with external services constituting just a small portion. A lot more is expected to unravel in the managed service market in future. Here are the top predicted trends:
Managed Services Will Move Beyond Price Wars
The managed service market is currently largely dominated by price - Providers are consistently engaged in price wars since consumers use it as a critical judgment factor when choosing services. In fact, many consumers have chosen a provider sorely because of “affordable” or “cheap” packages compared to the rest.
Of course this trend is negatively affecting the market because some consumers are blindly attracted to “free” but substandard packages. On the flip side however, it is encouraging aggressive competition between service providers, consequently reducing the cost of adopting managed services.
Although it’s expected to play out for some time, consumers will soon start breaking away from the price battles and start focusing more on quality. They’ll keenly assess the actual specs, features and benefits of individual packages rather than the price. Ultimately, service providers will be forced to shift from price to quality-centered battles to attract more consumers.
Increased Application Portability
Today, an average managed service user has a computer at work, laptop at home, smart phone and probably a tablet. With managed services busking in the glory of portability benefits, it’s expected that providers will proceed developing products which are compatible with all these devices. In addition to addressing portability issues, providers will concentrate on synchronizing their services and application state across a wide range of devices at the same time.
Over time, applications will not only be compatible with multiple devices, but will also run simultaneously across different platforms. Through this enhanced experience, users will switch freely between devices and proceed utilizing more managed resources.
According to Gartner Research, Internet-of-Things is already gaining momentum and will be a significant device feature in the near future. Currently, there are more than 4.9 billion Internet-of-Things enabled devices and the number is expected to grow by 30% on a yearly basis. The biggest beneficiaries, of course, are consumers due to the ability of networking their managed services on their devices.
Unfortunately, despite this excitement, there is a downside- security. According to Experian Data Breach Resolution, hackers are expected to pounce on the IoT network vulnerabilities once it starts going mainstream. It offers new, unexploited channels of hacking into managed service architectures.
To reduce the risk, consumers will of course depend on MSPs who offer innovative, secure services in an industry which is consistently facing increasing data security threats. Therefore, to reap the rewards of an expanding market base, MSPs will have to invest heavily in security, data protection and disaster recovery.
Use of APIs and Integration Tools
Over the years, MSPs have been doing extensive research and development on their products to boost their features and extend platforms to accommodate additional customers. Of course it has proven to be fairly effectual in attracting customers but quite expensive and cumbersome. It takes a lot of research and development to review architectures and adjust infrastructures to suit different customer needs.
Fortunately, MSPs have now found an easy way out- by avoiding all the R&D hard work and opting for APIs. This trend is expected to pick up and gain momentum in the near future, with MSPs pursuing third party integration tools as a better, more efficacious and less costly method of expanding their platforms. Consequently, vendors, ISVs and customers will simply integrate the services into their architectures without extensive development. This will see managed services expand faster and grow in popularity particularly among small and medium sized businesses. MSPs who are interested in becoming FileCloud partners click here
With many more exciting trends expected in the future, these are just but a tip of the iceberg. Predictably, according to the report “Managed Services market- Global Forecast 2019”, these trends and technologies will drive the global market to a value of $193.34 billion by the year 2019- with North America being the biggest consumers followed by Asia Pacific. At estimated 2014 global value of $107.17 billion, activities in the managed services market over the subsequent five years will see it grow by a compound rate of 12.5% per annum. With such a promising growth rate, managed service providers should buckle up for the future, and stay on the lookout for developing technologies/strategies to attract the ever-expanding customer base.
Author: Davis Porter
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