How Managed Services Providers Are Evolving With The Cloud

 In Blog, Cloud Service Providers, Cloud Services, Managed Service Provider

The managed services market is expected to grow from $186bn in 2019 to over $356bn by 2025. This growth is largely due to increasing demand for security, virtualization, disaster recovery, connectivity, and bandwidth services within a hybrid cloud environment. When the managed services model was first gaining traction in the 1990s, the internet consisted of only about 19,000 operational networks. Today sizing the internet is a nearly impossible task but we do know the indexed internet is made up of over 6 billion individual web pages consisting of billions of gigabytes of data. As the internet has grown, the managed services industry has evolved alongside it expanding beyond application and infrastructure management to include storage, security, mobility and even hardware as a service.

The traditional managed services model allowed businesses to efficiently stay up to date on their IT requirements by outsourcing these responsibilities to a managed service provider (MSP). The introduction of interconnected networks (the internet) allowed for the advent of remote computer system monitoring reducing the need for IT staff to be on-premise to provide support, management and monitoring. This model of outsourcing to an MSP allowed the client to shift greater responsibility onto the MSP as the MSP was allowed to proactively manage firmware and software updates. Eventually, the relationship with the MSP evolved to allow for proactive management of infrastructure and security.

With the introduction of cloud computing and services, businesses are able to consume compute resources as a utility, rather than having to build and maintain computing infrastructures in-house. This has shifted the focus for IT resources from on-premise computing power to network accessibility, uptime and speed. Cloud Computing creates significant advantages for businesses ranging from SMBs all the way to global enterprises. It also increased the reliance of businesses on MSPs as the MSPs have grown their service offerings to simplify the management of the cloud for clients. Just as managed services evolved from a break-fix for PCs to networking and the current proactive and predictive management methods, they are meeting the demands of the current cloud environments as well.

Businesses continue to adopt a hybrid IT model incorporating aspects of public and private cloud with traditional on-premise IT. While increasing productivity and efficiency, this model also increases IT complexity as the various networks and policies are seamlessly integrated. The security models and considerations are far more complex today in the hybrid cloud environment than ever before. But the solutions available are also far more advanced and tailored to this growing cloud dynamic.

To meet the demands of this increasingly complex IT environment, today’s MSP employs engineers with domain expertise in areas including WiFi, IaaS, PaaS, SaaS, and a growing list of new acronyms as technology continues to evolve. The areas of specialty for today’s MSP are vast. Forester Research reports that over 75% of businesses are utilizing a hybrid cloud environment and within that group, businesses are increasingly reliant on multiple clouds, this adds DevOps experience as a growing specialty for MSPs as well. The growth in corporate demand for cloud services has resulted in a unique evolution of the traditional MSP model creating a greater reliance on MSPs from both the cloud providers and businesses. Due to this reliance, it is estimated that capital expenditure by SMBs towards MSPs will grow at a 25% rate year-over-year and management of cloud services will take a larger share according to a recent survey conducted by Spiceworks. As the cloud has grown and consumed more business processes, MSPs have evolved to become a critical component enabling that growth.

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