Managed Network Services Market

Managed Network Services Market Outlook (2023 to 2033)

The global managed network services market stands at US$ 70.87 billion in 2023. Worldwide demand for managed network services is forecasted to reach a market value of US$ 154.44 billion by the end of 2033, increasing at a CAGR of 8.1% from 2023 to 2033.

Companies can outsource the management of their networks and customer-premise equipment, such as switches, routers, access points, firewalls, and other devices, using managed network services (MNS), a subset of managed services. Internet of Things technology has expanded the types of data that can be collected and enhanced operational effectiveness in terms of costs and data analytics.

Increased demand to streamline operational workflows and enhanced requirements for virtual security perimeters are the key factors driving market growth. Businesses are finding it easier to respond to technological advances because of scalable infrastructure and flexible managed service models.

• Network infrastructure is essential for communication, media, and services because it bridges the digital divide by providing quick network services and finding affordable solutions to bandwidth shortage issues.
• Deployment of MNS for communication, media, and services is projected to surge at a CAGR of 9% over the next ten years.

Cloud-based managed services have seen a surge in capital investment from small and medium-sized organizations, which is estimated to drive this industry over the coming years. Additionally, as a result of digitization, networks are being required to be more agile, enabling businesses to offer better consumer experiences.

Some businesses throughout the world are attempting to incorporate new digital technology as part of the digital revolution movement. Every business has enlisted the aid of a managed network service provider as it continues to invest in digital transformation.

Managed network services free up businesses to concentrate on their main operations and objectives. These services enhance the speed and flexibility of the business while combining high-performance network accessibility. The infrastructure that managed network service providers have in place helps them deploy and upgrade their services.

Proactive inspections and enhancements are continuously performed as well as preventative maintenance under the established network structure. Increasing business process efficiency through cost optimization and the high use of cloud computing and big data technology and services are some of the key reasons fueling market expansion.

Report Attributes	Details
Managed Network Services Market Size (2023)	US$ 70.87 Billion
Forecasted Market Value (2033)	US$ 154.44 Billion
Global Market Growth Rate (2023 to 2033)	8.1% CAGR
Market Share of Managed Network Security Services (2023)	35%
United States Market Value (2033)	US$ 60.69 Billion
Market Share of MNS for Communication, Media, and Services (2023)	34%
China Market Growth Rate (2023 to 2033)	8.3% CAGR
Germany Market Size (2023)	US$ 5.24 Billion
United Kingdom Market Growth Rate (2023 to 2033)	6.8% CAGR
Key Companies Profiled	Alcatel-Lucent Enterprise AT&T Inc. CenturyLink Inc. Cisco Systems Inc. Ericsson GTT Communications Inc. HCL Technologies Ltd. Hewlett Packard Enterprise Company Huawei Technologies Co. Ltd. IBM LG Networks Inc. TATA Communications Ltd. Wipro Limited

Why are Managed Network Services Gaining High Importance across End-use Verticals?

“Augmenting Demand for Managed Network Services for Workflow Streamlining”

The desire for more agility in networks that support businesses in delivering improved customer experiences is being driven by digital transformation. As businesses continue to invest in digital transformation, every company has enlisted the help of managed network service providers.

• According to a managed service provider, Marco, 59% of IT services have transitioned from the traditional break-fix model to a managed service contract model. Furthermore, 45% of organizations intend to collaborate with a managed security service provider over the coming years. All of this is done to effectively streamline the daily operational workflow across businesses.
• As per a publication released by the United States Government, over 4,000 ransomware attacks have occurred since January 2016. Hence, protecting this information has prompted increased adoption of managed security services.

Greater network agility is required as a result of digital transformation for organizations to provide better consumer experiences. As part of the movement towards digital transformation, several businesses worldwide want to incorporate new digital technology.

“Increasing Quantum Computing Technology Integration”

Quantum computing technology uses less electricity and can conduct a variety of calculations that are both faster and more accurate than existing supercomputers. This has prompted businesses such as aerospace and defense, information technology and telecommunications, transportation, and financial services to use quantum computing technologies to manage data.

Prolific developments are anticipated in the telecom sector, with quantum radio access networks becoming a reality by the end of the forthcoming decade. As the technology matures and quantum chips become available in more compact form factors, they could be deployed closer to user premises. Processors would be cloud-enabled to target the acceleration of virtualized RAN functions.

• Accenture Plc is offering a Master’s course in Quantum Computing Technology in collaboration with the University of Madrid to acquaint individuals with network security and equip them to manage complex workflows.

Which are the Major Challenges Encountered by Providers of Managed Network Services?

“Lack of Experienced Data Science Specialists and Growing Concerns about Overexposure of Personal Data”

The market for managed network services is hampered by growing concerns about the overexposure of personal data. High deployment costs of managed network services are restraining market demand.

Lack of expert knowledge, technological skill, and awareness, particularly in emerging economies, is limiting market growth to some extent. Poor adoption rate in developing countries combined with a shortage of experienced data science specialists is impeding industry expansion.

How are Start-ups Increasing their Profits in This Market?

“New Companies Focusing on Offering Modular & Interoperable Managed Network Solutions”

Development of open-source software enables the development of more safe and reliable solutions since any member of the community can find and fix faults in the code. This is crucial for SD-WAN, where network security and dependability are given more weight.

Emerging market players are attempting to provide modular and interoperable managed network solutions that benefit the whole industry. This implies that interoperable software is compatible with all hardware for SD-WANs. As a result, operational expenses are reduced, and network performance is improved.

• Israeli start-up flexiWAN offers open-source SD-WAN, enabling organizations to adopt highly adaptable solutions. In contrast to modular, open-source alternatives such as flexiWAN, network equipment vendors offer their software in the form of a monolithic black box, needing more computational resources. Additionally, flexiWAN makes use of innovative, open-source components that are already in existence together with components that were created from scratch especially for this project to offer more affordable and competitive choices than current proprietary closed SD-WAN.

Country-wise Insights

How Lucrative is the United States Market for Suppliers of Managed Network Services?

“Presence of Advanced IT Infrastructure Pushing Need for Managed Network Services”

• The market in the United States is projected to expand at a CAGR of 8.2% from 2023 to 2033.

Growing preference for telehealth services among various healthcare practitioners is driving market growth in the country. Another crucial element influencing market demand is the presence of advanced IT infrastructure.

Leading companies in the United States are increasingly relying on managed service providers (MSPs), notably for IT support services. Prominent service providers have set in motion a series of collaborative agreements across the country.

• In 2020, Microsoft Corporation signed five definitive agreements to acquire Metaswitch Networks, helping the former capitalize on its offering of ultra-high performance, cloud-native communications software for the telecommunications industry.

Why is Germany Set to Exhibit High Demand for Managed Network Services?

“Increasing Trend of Outsourcing Network Infrastructure Activities”

• Demand for managed network services in Germany is set to increase at a CAGR of 8.8% over the next ten years.

The market for managed network services in Germany is driven by the growing investments in cloud computing technologies and rising demand for network access control solutions. The increasing trend of outsourcing network infrastructure activities and rapid expansion of small and medium-sized businesses across several industry verticals are boosting market value in the country.

What is Boosting the Sales of Managed Network Services in China?

“Surging Internet and Mobile Penetration in the Country”

• The managed network services market in China is predicted to reach US$ 27.49 billion by 2033.

Widespread presence of 5G connectivity infrastructure is providing a major boost to managed network services demand. The growing acceptance of cloud managed services among small and medium-sized businesses.

Rising internet and mobile penetration and an increase in SMEs operating across a variety of industries in the country are all factors contributing to market expansion. The demand for reliable and safe Internet access and the growing usage of smart devices are the factors driving the market for managed network services.

Category-wise Insights

Why are Managed Network Security Services Highly Demanded?

“Managed Network Security Services Shield Enterprise Perimeters from Various Security Risks”

By service type, the market is segmented into managed voice network services, managed VPN services, managed network security services, managed network conferencing services, and managed WAN/SD WAN services.

• Managed network security services are ruling the industry with 35% share.

With deepening technology penetration, threats concerning potential cyberattacks and data breaches have surged exponentially. Global outages experienced due to potentially dangerous malware attacks have necessitated the deployment of managed network security services.

To protect business and personal interests from falling prey to cybercriminals, the scope for security services has surged. Service providers such as Sophos and NTT have gained high prominence in the cybersecurity space. The increasing need for unified threat management systems is driving the demand for managed network security services.

Third parties offer managed network security services to oversee and manage a company's security operations. Local and remote services are provided by managed security service providers, typically via the cloud. Managed service providers offer a wide range of security services, including security management, incident response, and infrastructure configuration.

Threats to systems and data hurt compliance efforts and limit productivity and company innovation. Managed network security services shield enterprise perimeters from a range of security risks. Managed service providers undertake internal and external compliance audits to make sure that security operational procedures and technologies are current, and they deploy strong security controls and safeguards to safeguard client information and business network services from external threats.

Competitive Landscape

Key managed network service providers are leveraging strategies such as partnerships with government authorities or regional service providers and quality control to increase their market revenue. They are focusing on the introduction of new management services and acquiring existing small and medium-scale service providers.

For instance :

• In 2021, AT&T Inc. announced that the United States Air Force selected the company’s FirstNet® high-speed broadband communications platform to deliver reliable and on-priority communications to its public safety personnel and first responders across 15 bases.

Key Segments of Managed Network Services Industry Research

• By Service Type :

  • Managed Voice Network Services
  • Managed VPN Services
  • Managed Network Security Services
  • Managed Network Conferencing Services
  • Managed WAN/SD WAN Services

• By Enterprise Type :

  • Small Enterprises
  • Medium Enterprises
  • Large Enterprises

• By End Use :

  • Banking & Securities
  • Insurance
    • Health Insurance (Payer)
    • Insurance (Other than Health)
  • Communication, Media & Services
    • Entertainment
    • Publishing and Advertising
    • Broadcasting and Cables
    • Telecommunications
    • Other Businesses, Technical and Consumer Services
    • IT Services & Software
  • Healthcare Providers
    • Physicians
    • Hospitals
  • Manufacturing & Natural Resources
    • Automotive
    • Consumer Nondurable Products
    • Energy Resources & Processing
    • Heavy Industries
    • IT Hardware
    • Life Sciences and Healthcare Products
    • Natural Resources & Materials
  • Retail
    • General Retailers
    • Groceries
    • Restaurants and Hotels
    • Specialty Retailers
  • Wholesale Trade
  • Transportation
  • Transport
    • Motor Freight
    • Pipelines
    • Rail & Water
    • Warehousing, Couriers, and Support Services
  • Utilities
  • Education
  • Governments

• By Region :

  • North America
  • Europe
  • Asia Pacific
  • Latin America
  • Middle East & Africa