The global managed services market size was estimated at USD 299.01 billion in 2023 and is anticipated to grow at a compound annual growth rate (CAGR) of 13.6% from 2023 to 2030. Managed services reduce downtime redundancy and provide customized value-added services such as application testing, service catalog building, and expert consultancy. Multiple monitoring tools and several layers of infrastructure managed by isolated teams contribute to market growth. Furthermore, to streamline infrastructure and reduce costs, enterprises globally are migrating to the cloud platform and adopting managed IT services to optimize their infrastructure costs. Professional and managed services help enterprises compete with this digital transformation faster and more efficiently. Market players are focusing on unveiling innovative managed services for enterprise businesses to acquire a significant share of this potential market.

The companies operating in the managed services market are establishing strategic partnerships to provide their cloud & infrastructure managed services to the client for increased security & compliance and enhanced business performance. For instance, in April 2023, Sinch, a Microsoft Operator Connect partner, announced a partnership with Synoptek to provide managed and professional services for the Microsoft Teams Phone System, which is integrated with direct routing or operator connect. Factors such as improving operational efficiency by focusing more effectively on core competencies, cutting operating expenses, and increasing use of cloud-based technologies such as automation, IoT, blockchain, and cloud computing are driving market growth.

Gather more insights about the market drivers, restrains and growth of the Managed Services Market

Detailed Segmentation:

Market Dynamics

Enterprises are putting a strong emphasis on improving business productivity and are hence aggressively adopting new, innovative business applications based on the advances in the latest, emerging technologies, such as Internet of Things (IoT), cloud computing, Software-as-a-Service (SaaS), big data, machine learning (ML), and artificial intelligence (AI). Small-& medium-sized businesses (SMBs) are typically opting for cloud computing to enhance the security, availability, and accessibility of their business applications and data.

Market Characteristics

The growth of the managed services market is high, and the growth’s pace is accelerating. The managed services market is characterized by a high degree of innovation owing to the notable advancements in big data analytics, Artificial Intelligence (AI), cloud computing, Machine Learning (ML), and cybersecurity, among others. Further, the shifting focus of various end-user companies on migrating their business operations to cloud platforms is expected to create robust opportunities for the managed services market growth.

Solution Insights

In terms of solutions, the managed data center segment held the largest market share in 2022 of over 15% The managed data center segment is expected to expand due to the continued integration of cutting-edge technology into existing and new corporate infrastructures. Managed data center services might help optimize corporate operations by boosting business automation and strengthening business management in a hybrid IT architecture.

Managed Information Service (MIS) Insights

In terms of MIS, the business process outsourcing (BPO) segment held the largest market share exceeding 40% in 2022. Utilizing BPO as part of a business strategy to focus on core strengths and boost profitability is expected to fuel the growth of the BPO segment. Growth of BPO services is projected to be driven by several factors, including a focus on process automation, social media management tools, and investments in cloud computing.

Deployment Insights

In terms of deployment, the on-premise segment held the largest market share of over 64% in 2022.  Numerous organizations have adopted on-premise mode of deployment as it does not require an internet connection and allows easy customization of software to suit the business process requirements of clients. The on-premise implementation also aids in increasing operational efficiency and establishing a control center within an organization for efficiently coordinating and controlling various project management duties and business operations.

Enterprise Size Insights

In terms of enterprise size, the large enterprises segment held the largest market share of over 60% in 2022. Large businesses deal with large amounts of data that must be successfully maintained and accessible locally and remotely. Furthermore, large organizations are increasingly turning to managed security services to maintain and monitor their corporate data security. Due to increasing cyberattacks and less developed infrastructures to detect breaches, managed security services are the most requested service by businesses across the region. A cyberattack or data breach at a large corporation in APAC might result in a considerable loss. 

End-use Insights

In terms of end-use, the BFSI segment accounted for the largest market share of over 15% in 2022. Financial institutions are turning to managed services to address various issues, including keeping abreast with technological advancements, market and regulatory changes, and a looming shortage of employees with experience in cutting-edge technologies, among others. The managed services model often aids in the management of company processes and operations while boosting operational efficiency and product quality. Managed services are becoming increasingly popular as businesses seek a more strategic approach to operate, organize, and protect their operations effectively. A managed services partnership's long-term, tightly integrated structure provides significant strategic benefits in addition to cost savings. 

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Key Companies & Market Share Insights

Some of the key players operating in the market include Accenture, International Business Machines Corporation, and Cisco Systems, Inc.

• Accenture provides various infrastructure-managed services that include hosting, migrating, and managing the client’s infrastructure. It also helps clients streamline the human-centric experiences to optimize the physical workspace and support workforce collaboration.

• Cisco Systems, Inc. offers managed services to protect the clients’ end-point devices and provides actionable insights to the clients to assist them in making data-driven decisions to maximize business profitability.

Managed Services Companies:

• Accenture

• Atera Networks Ltd.

• ARYAKA NETWORKS, INC.

• AT&T Inc.

• BMC Software, Inc.

• Broadcom

• Cisco Systems, Inc.

• DXC Technology Company

• Fujitsu

• HCL Technologies Limited

• HP Development Company, L.P.

• International Business Machines Corporation

Recent Developments

• In October 2023, technology services provider Logicalis launched an Intelligent Connectivity suite that includes solutions such as SASE, SSE, SD-WAN, and Private 5G powered by Cisco Systems, Inc. This will enable Logicalis customers to access digitally managed services developed using Cisco technology and supported by the Logicalis Digital Fabric Platform.

• In September 2023, communications & technology solution provider Cloud5 Communications launched its new managed services division. The division is designed to support the IT-related requirements & challenges in various markets, such as the hospitality industry, student housing, and senior living, among others. This division will assist consumers in efficiently managing IT operations, technology infrastructures, and security.

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