Cloud Managed Services Market

Cloud Managed Services Market Outlook

Global sales of cloud managed services in 2021 was held at US$ 86.1 Bn. With 9.6%, the projected market growth during 2022 - 2032 is expected to be significantly higher than the historical growth. Managed Network Services are expected to be the highest revenue generating cloud managed services type, with a projected growth of 9.1% during 2022 – 2032.

Attribute	Details
Forecast Period	2022-2032
Historical Data Available for	2015-2021
Market Analysis	US$ Bn for Value
Key Regions Covered	North America Latin America Europe East Asia South Asia Oceania MEA
Key Countries Covered	U.S. U.K. China Japan South Korea Germany France Italy Spain Brazil Mexico Argentina South Africa Saudi Arabia UAE Australia India
Key Market Segments Covered	Service Type Vertical Organization Size Region
Key Companies Profiled	IBM Ericsson AWS Cisco Infosys NTT Data Fujitsu Accenture HPE NEC Google Microsoft Intel DigitalOcean
Pricing	Available upon Request

Key Points Covered in cloud managed services Industry Survey:

• Market Estimates and Forecasts (2017-2032)
• Key Drivers and Restraints Shaping Market Growth
• Segment-wise, Country-wise, and Region-wise Analysis
• Competition Mapping and Benchmarking
• Market Share Analysis
• COVID-19 Impact on Cloud Managed Services and How to Navigate
• Recommendation on Key Winning Strategies

Revenue of Cloud Managed Services from 2017 to 2021 Compared to Demand Outlook for 2022 to 2032

As per the cloud managed services industry research by Fact.MR - a market research and competitive intelligence provider, historically, from 2015 to 2021, market value of the cloud managed services industry increased at around 11.2% CAGR, wherein, countries such as the Germany, U.S., China and Japan held significant share in the global market.

The continuous surge in digitization and increase in demand of IT infrastructure is propelling the demand for high speed internet which is consequently driving the need for logistics in IT systems for high-speed data transfer, big data storage and need of data centers with increasing consumers on digital platforms. Owing to this, cloud managed services market is projected to grow at a CAGR of 9.6% over the coming 10 years.

• The cloud managed services market reached a valuation of US$ 86.1 Bn in 2021. Fact.MR estimates that cloud managed services revenue will grow 2.5X from 2022 to 2032, reaching nearly US$ 237 Bn in 2032.
• With 34.5%, US held the largest share in the cloud managed services market. It is also expected to be the fastest growing market for cloud managed services, with a CAGR of 9.4%.
• Managed Infrastructure Services shows the highest growth potential in the cloud managed services industry. Its market is expected to grow at a rate of about 9.1% during the next ten years.

What Factors are leading to the Growth of Cloud Managed Services Industry?

Nowadays, computers and mobile phones have become inevitable part of our lives. Growing number of consumers on digital platforms has increased the need of continuous advancement in digitalization for high speed data transfer with large network coverage for large amount of data storage. For instance, distance learning, multiuser gaming, videoconferencing, live streaming have escalated the growth of the consumer base in IT industry. To store large data and provide better services IT companies requires large servers, data storage units.

Managed services provides computing infrastructure, data centres, data storage which companies can rent access to anything from applications to storage from a cloud service provider on the basis of demand. Largest benefits of cloud services are avoiding the fixed cost for building large IT infrastructure and complication of having and maintaining their own IT infrastructure, and paying for what they will consume, when they use it.

During Covid several governments have implemented compulsion of work from home, which resulted in increase in demand of cloud based solutions such as SaaS based collaboration. Several companies rely on cloud computing owing to digitalization and collection of big data. For instance, Netflix uses cloud services to run video-streaming services, which provides customer seamless experience of product. The presence of large number of companies such as IBM, Accenture, Amazon, and Nordcloud, in the sector will emerge to improve the overall growth of the market.

Several infrastructure software, business process services and system infrastructure companies are expected to shift towards cloud based services by 2025. During lockdowns in the pandemic, industries observed the importance of access to computing infrastructure, applications and data requirement. Also, demand for high internet speed has been increasing due to increase in digital media such as YouTube and Netflix as compared to main stream media. Therefore, to suffice this demand of high speed network, data storage to enhancing mobile network performance capabilities and better customer needs, demand of cloud managed services will increase dramatically in coming years.

How Cloud Managed Services are Being Effectively used for Large Data Storage and Enhanced Services in IT Companies?

Storing the data has become important than ever before for industries, with application of data science for providing better and seamless user experience. Cloud services provides platforms to save data and files in an off-site location that one can access through the public internet or a dedicated private network connections.

Developers can easily design and test new application architecture without depending on on-site hardware limitations. Companies can add or remove capacity of require storage or IT infrastructure, and they only have to pay for storage that they actually consume.

There are three types of cloud managed services including public cloud, private cloud and hybrid cloud. Nowadays, people can view and edit documents using mobile phones, using Microsoft’s Office Web Apps, and Google Docs. This type of cloud computing service model called as ‘Software as a Service’ (SaaS). However, SaaS have limitations of services which are restrictive to businesses and industries, which need to develop and run their own software applications. For this purpose they can use, ‘Platform as a Service’ (PaaS) and ‘Infrastructure as a Service’ (IaaS). Earlier only large companies could purchase large software but because of cloud services “pay as you use” model services have become affordable.

How the Consumer Concerns about Cloud Security Leading a Moderate Impact on the Cloud Managed Services Market?

There are some concerns about security and privacy with cloud computing. Companies’ handing over important and critical data to their cloud vendors have created an environment of doubt. However, owing to strong security and data privacy and encrypted information transfer these problems can mitigate. Overall, cloud services provides better and optimal solutions to companies and consumers due to reduced cost, flexibility to scale up, high performance, high speed of deployment for large software’s and better productivity.

Which Region is projected to Offer the Largest Opportunity for Cloud Managed Services?

Cloud managed services market is expected to grow at a substantial rate in the forthcoming years. The market in APAC is expected to register the highest CAGR during the forecast period due to increased demand for IT infrastructure coupled with rapid expansion of digitalization in countries including Japan and China. This increase is also due to the growing innovations, investment in R & D and company partnerships among various companies.

Country-wise Analysis

Which Country Topped the Revenue Generation for Cloud Managed Services market?

The U.S. dominated the market in 2021 with a global share of over 34%. This is due to the increased R & D investment and the local presence of global players. For instance, large companies in the U.S. spent around US$ 18 Bn in the first quarter of 2021.

Over the last decade, the number of IT companies have increased significantly. In addition, due to Covid-outbreak the demand for digital platforms due to work from home model increased rapidly. Gaming industry has also been propelling the demand of live streaming which requires high-speed and large bandwidth of network. Moreover, the U.S. government have added US$ 1 Bn in Technology Modernization Fund as part of the American Rescue Plan. All these factors have been contributing to increase in demand for cloud managed services in the country.

Category-wise Insights

What Makes Managed Infrastructure Services the Largest Revenue Generator Category in Cloud Managed Services?

Managed infrastructure services segment held the largest share of sales and is expected to grow at a CAGR of 9.1% in the next ten years. Recent developments in the IT infrastructure industries are enabling growth of managed infrastructure services market. For instance, IBM has announced separation of its Managed Infrastructure Services unit to a new company named "NewCo". It will be entirely focused on managing and updating client-owned infrastructures, which is predicted to be worth US$ 500 Bn market opportunity. Companies have relied on Managed Infrastructure Service Providers (MSP) for cost efficient services which allows enterprises to focus on their core business and be more creative and efficient while minimizing risk.

Which Industry Application Shows the Highest Demand over the Next Ten Years for Cloud Managed Services?

Cloud managed services market is expected to be propelled by demand from retail industry. As more number of businesses have started relying on e-commerce retail, the demand for cloud managed services have skyrocketed. A humongous data is being generated by the key e-commerce retail providers such as Amazon and Walmart. Cloud enables e-retail companies to store data centres online rather than building huge IT infrastructure that involves high setup costs and maintenance. Cloud services and analytical tools can help retailers exploit predictive forecasts, which improve their sales and profit margins.

How Has COVID-19 Impacted Revenue Generation from Cloud Managed Services?

The impact of COVID-19 on cloud managed services has positively impacted due to adaptation of digital platforms by industries which lead to increase in demand of high speed network with companies adapting work from home model. Schools have adapted to e-learning platforms, moreover escalated frequency of video calling & video conferencing services due to COVID-19 has led to increased cloud services adoption. In first quarter of 2020, cloud services spending increased by around 35%. The reason for the growth of the industry during the pandemic may be credited to the faster adaptation of digital platform by industries and customers during the pandemic.

Competitive Analysis

The key players such as IBM, Ericsson, AWS, Cisco, and Infosys adopt several organic and inorganic strategies to enhance their revenue and market standings.

Some of the recent developments of key cloud managed services providers are as follows:

• In March, 2022, Google announced that they have launched new Tau T2D VMs, which delivers 42% better price-performance compared to leading cloud providers. It offers more flexibility to support customers’ enterprise with dual-region buckets and upcoming Turbo Replication. Google cloud is set to expand at a large scale on global network with the inclusion of 29 new regions.
• In September 2021, DigitalOcean acquired a serverless platform provider, Nimbella. It will help companies adopt serverless computing; while, DigitalOcean provides cloud services to help businesses scale themselves.
• In April, 2021, Microsoft acquired Nuance Communications, which is a leading provider of conversational AI in healthcare domain. Microsoft completed this acquisition with a valuation of US$ 19.7 Bn.
• In Oct 2020, IBM Corporation to separate its managed infrastructure services unit of its Global Technology Services division into a new public company named "NewCo".

Similarly, recent developments related to companies cloud managed services have been tracked by the team at Fact.MR, which are available in the full report.

Market Segments Covered in Cloud managed services Industry Analysis

• By Service Type :

  • Managed Business Services
  • Managed Network Services
  • Managed Security Services
  • Managed Infrastructure Services
  • Managed Mobility Services
  • Managed Communication and Collaboration Services

• By Vertical :

  • BFSI
  • Telecom
  • Government and public sector
  • Healthcare and life sciences
  • Retail and Consumer goods
  • Manufacturing
  • Energy and Utilities
  • IT
  • Others (Transport, Education, and Travel and Hospitality)

• By Organization Size :

  • Large Enterprises
  • Small And Medium-Sized Enterprises