IDC Survey Shows That Managed Service Providers Face Numerous Challenges in the Evolving and Highly Competitive Managed Cloud Services Market

NEEDHAM, Massachusetts – (BUSINESS WIRE) – As businesses continue their transition to the cloud, the opportunities and roles for Managed Service Providers (SPs) have expanded and become more complex. At the same time, the managed cloud services market has become more competitive as organizations increasingly seek solutions and leadership in their public cloud service providers. A recent survey by International Data Corporation (IDC) examines the set of business services and requirements that managed SPs and their ecosystem partners need to invest in to maximize market opportunities and gain competitive advantage in the managed cloud services market.

Key findings from IDC’s Managed CloudView 2021 survey include the following:

Cloud strategy and business resilience. In the wake of the pandemic, organizations are looking to use public cloud capabilities (IaaS, PaaS, SaaS), innovative technologies and processes (IoT, edge computing, blockchain), and multicloud management platforms to support future cloud strategies and ensure resilience. corporate.

Critical metrics. While very few organizations have moved all (100%) of their IT (applications and infrastructure) to the cloud, it appears that companies will accelerate this transition over the next few years with varying transition rates by country and industry. The overall projected cost savings for managed cloud services in 2021 is 40%, up from 37% in 2019.

Corporate baccalaureate. Buyers are using managed cloud services to create more agile IT, generate new revenue and improve the customer experience, but there are still concerns about ensuring service level agreements (SLAs), IT performance for critical applications, and security . However, organizations indicate that they intend to significantly increase spending on these services over the next 12-24 months.

Procurement strategy. Most companies prefer to work directly with a managed SP to manage their public cloud provider and all resources hosted on the public cloud provider’s platform to ensure better communications and compliance with SLAs. At the same time, most organizations prefer to use the management tools of each public cloud provider.

Advanced automated technologies. A significant share (around 40%) of companies are already using queue-free / low-code functionality as part of their managed cloud services, with another 30-35% planning to do so within the next two years. Using AI / AI as part of managed cloud services, companies focus on more efficient IT operations and aligning IT consumption with individual (role-based) needs.

Operational expectations. Companies using managed cloud services consider CoEs (centers of excellence) to be the most critical for ensuring operational excellence, although centralized command centers and business units for public cloud providers are equally important in some industries. Most organizations are also turning to public cloud providers to reduce carbon emissions from their data centers.

Private, public and hybrid clouds. While most organizations prefer to redesign their existing IT resources into private clouds rather than buy pre-built private clouds, they also overwhelmingly prefer to use public cloud services over private clouds to meet a variety of needs (e.g. e.g. productivity, ROI, resource utilization) as part of managed cloud services. The role of the public cloud as part of a hybrid cloud strategy is to provide access to public IaaS cloud capabilities not available in private clouds and to meet the need for spikes in demand.

“Ensuring success in the managed cloud services market will require managed SPs to provide a means to adapt their talent, technologies, processes and organizational structures to meet customer needs; integrate professional services into managed cloud services; emphasize customer centricity; and working with cloud service provider partners to optimize matrix position and market opportunities, ”said David Tapper, program vice president, Outsourcing and Managed Cloud Services at IDC. “In addition, they will need to invest in sustainable offerings for the socially conscious customer; create a corporate operations center; incorporate an intelligent, unified multicloud management platform; implement a robust governance model; and build centers of excellence and labs for cloud platforms.”

Taxonomy Note: “Managed Cloud Services” implies that third party service providers take ownership and responsibility for managing all or part of a customer’s IT environment (e.g. applications, infrastructure) operations (24×7 ) on the basis of a service level agreement provided through a private (dedicated to one enterprise) and / or public (shared between unrelated enterprises) infrastructure as cloud service (IaaS). This may also include using managed services to support platform as a service (PaaS) and software as a service (SaaS). Managed cloud services do not include internal IT departments that manage their clouds privately (for your business) or as part of acquiring public cloud services via self-service functions directly with public cloud providers (IaaS) (eg. Amazon, Microsoft AZURE, Google, IBM, Alibaba).

IDC’s Managed CloudView survey surveyed 1,500 organizations, including IT and line of business respondents, across six countries and a broad range of industries, to gather insights into enterprise adoption of managed cloud services. Key topics covered include cloud strategy and business resilience, critical metrics, business maturity, procurement strategy, advanced automation, operational expectations, cloud operating models (private, public and hybrid), mainframe, recovery services and availability, and perceptions and preferences of SP (service providers). The IDC report, Managed CloudView 2021: Executive Summary (IDC # US48220821), provides an analysis of these findings and includes strategic messages, highlights, implications for service providers, and IDC’s essential guidelines for managed SPs.

International Data Corporation (IDC) is the leading global provider of market information, advisory and event services for the information technology, telecommunications and consumer technology markets. With over 1,100 analysts worldwide, IDC offers global, regional and local expertise on technology, IT benchmarking and procurement, and industry trends and opportunities in over 110 countries. IDC’s insight and insight help IT professionals, business executives and the investment community make fact-based technology decisions and achieve their key business goals. Founded in 1964, IDC is a wholly owned subsidiary of International Data Group (IDG), the world’s leading technology media, data and marketing services company. For more information on IDC, visit Follow IDC on Twitter at @IDC and LinkedIn. Subscribe to the IDC blog for industry news and insights.

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