Market Analysis and Insights:
The market for Global IT Managed Services was estimated to be worth USD 215.35 billion in 2021, and from 2021 to 2031, it is anticipated to grow at a CAGR of 7.94%, with an expected value of USD 501.37 billion in 2031.
The IT Managed Services Market is being propelled by various significant factors. Initially, the ened intricacy and technological progressions in IT infrastructure have prompted organizations to engage external expertise and assistance in overseeing their IT operations. This encompasses services like network monitoring, data backup and recovery, and cybersecurity, among others. Subsequently, the escalating need for economical IT solutions is compelling organizations to choose managed services over establishing their proprietary in-house IT departments. This enables them to capitalize on the proficiency and resources of managed service providers (MSPs) while curtailing operational expenses. Additionally, the increasing emphasis on business continuity and disaster recovery is spurring the requirement for IT managed services, as organizations endeavor to safeguard their data and ensure uninterrupted operations in the event of unexpected occurrences.
Moreover, the surging adoption of cloud computing and digital transformation initiatives is propelling the demand for managed services, as businesses seek support in migrating their systems, overseeing hybrid cloud environments, and optimizing their IT infrastructures. These propelling elements are projected to persist in shaping the IT Managed Services Market in the foreseeable horizon.
IT Managed Services Market Scope:
| Metrics | Details |
| Base Year | 2023 |
| Historic Data | 2018-2022 |
| Forecast Period | 2024-2031 |
| Study Period | 2018-2031 |
| Forecast Unit | Value (USD) |
| Revenue forecast in 2031 | USD 501.37 billion |
| Growth Rate | CAGR of 7.94% during 2021-2031 |
| Segment Covered | By Type, By Application, By Region. |
| Regions Covered | North America, Europe, Asia Pacific, South America, Middle East and Africa |
| Key Players Profiled | IBM Corporation, Cisco Systems Inc., Hewlett Packard Enterprise Company, Accenture plc, Fujitsu Limited, Tata Consultancy Services Limited, Atos SE, Cognizant Technology Solutions Corporation, DXC Technology Company, and Infosys Limited. |
Market Definition
IT Managed Services involve the delegation of IT tasks and obligations to an external provider, who takes a proactive approach in overseeing and upkeeping the IT infrastructure, networks, and systems of the client. This service encompasses ongoing monitoring, upkeep, and assistance to guarantee the IT environment operates at its peak performance levels, while also ensuring security and dependability.
Managed IT services play a crucial role in the modern business environment for several key reasons. Firstly, these services grant businesses access to skilled IT professionals who can effectively manage various aspects of technology, such as network upkeep, software upgrades, and cybersecurity.
This allows companies to concentrate on their core functions while entrusting IT-related duties to knowledgeable professionals. Secondly, by outsourcing IT services to a managed service provider, businesses can experience considerable cost savings as they are relieved from the need to invest in costly IT infrastructure or employ and train internal IT teams. Instead, they can pay solely for the services they use. Lastly, Managed IT services offer proactive monitoring and prompt issue resolution, guaranteeing that any IT problems are swiftly addressed, reducing downtimes, and increasing productivity. In essence, Managed IT services are vital for assisting businesses in optimizing their IT systems, strengthening security measures, and streamlining operations, ultimately leading to improved efficiency and competitiveness.
Key Market Segmentation:
Insights On Key Type
Cloud-Based
The Cloud-Based type is expected to dominate the Global IT Managed Services Market. With the rising adoption of cloud computing among businesses worldwide, the demand for cloud-based managed services is on the rise. Cloud-based managed services provide flexibility, scalability, and cost-effectiveness to businesses, allowing them to focus on their core competencies while outsourcing their IT management and support. This part offers benefits such as remote monitoring, data backup, disaster recovery, and 24/7 technical support. Additionally, the increasing need for advanced technologies like AI, IoT, and big data analytics further drives the demand for cloud-based managed services.
On-Premise
While the Cloud-Based type is expected to dominate, the On-Premise v still holds significance in the Global IT Managed Services Market. On-premise solutions provide businesses with complete control over their IT infrastructure and ensure data security. Some organizations have specific regulatory requirements or sensitive data that need to be stored on-premise, which makes on-premise managed services essential for them. However, the demand for on-premise solutions is gradually decreasing, mainly due to the advantages offered by cloud-based solutions. The high upfront costs, maintenance requirements, and limited scalability associated with on-premise solutions are driving businesses towards the cloud-based alternative.
Insights On Key Application
Government
The Government application is expected to dominate the Global IT Managed Services Market. This is primarily due to the increasing adoption of IT technology and services by government organizations worldwide. Governments are increasingly using IT managed services to enhance their operational efficiency, streamline their processes, and improve service delivery to citizens. Additionally, the growing need for data security and compliance in the government sector further drives the demand for IT managed services. Governments also rely on managed services providers to handle their IT infrastructure, network management, cloud services, and other technical needs. As a result, the Government part is expected to hold a significant share in the Global IT Managed Services Market.
BFSI
The BFSI (Banking, Financial Services, and Insurance) application is also a key player in the Global IT Managed Services Market. With the digital transformation of the banking and finance industry, there is a rising need for IT solutions and services to manage complex financial processes, ensure data security, and meet regulatory compliance. IT managed services enable banks, financial institutions, and insurance companies to optimize their IT infrastructure, enhance customer experiences, and reduce operational costs. The BFSI sector heavily relies on IT managed services for managing financial systems, cybersecurity, risk management, and customer relationship management. Therefore, the BFSI part is expected to have a significant presence in the Global IT Managed Services Market.
Retail
The Retail application holds considerable potential in the Global IT Managed Services Market. The retail industry is undergoing rapid digital transformation, with the increasing adoption of e-commerce, omnichannel retailing, and mobile technologies. To remain competitive, retailers require comprehensive IT solutions to manage their inventory, supply chain, customer relationship management, and online platforms. IT managed services play a vital role in supporting retailers in infrastructure management, system integration, cybersecurity, data analytics, and cloud services. As retailers focus on enhancing their online presence and delivering personalized experiences to customers, the demand for IT managed services is expected to grow significantly in the Retail part.
Logistics
The Logistics application is an emerging player in the Global IT Managed Services Market. The logistics industry is increasingly using IT solutions for managing transportation, warehouse operations, inventory tracking, and supply chain visibility. IT managed services help logistics companies streamline their operations, optimize routes, improve customer service, and reduce costs. With the rising demand for efficient logistics and supply chain management, the adoption of IT managed services in the logistics sector is expected to increase. Therefore, the Logistics part is set to have a notable presence in the Global IT Managed Services Market.
Healthcare and Lifesciences
The Healthcare and Lifesciences application is also expected to be a significant player in the Global IT Managed Services Market. The healthcare industry has increasingly adopted IT to improve patient care, enhance operational efficiency, and ensure data security and compliance. IT managed services support healthcare organizations in managing electronic health records, healthcare IT infrastructure, telemedicine solutions, data analytics, and cybersecurity. The growing focus on digitization and healthcare technology advancements drives the demand for IT managed services in the Healthcare and Lifesciences part.
IT and Telecom
The IT and Telecom industry is a mature application in the Global IT Managed Services Market. IT and telecom companies themselves heavily rely on managed services for IT infrastructure management, network operations, cloud services, cybersecurity, and data analytics. While the demand for IT managed services by the IT and Telecom part remains strong, it may not dominate the overall market as other industries, such as government, BFSI, retail, and logistics, are witnessing faster growth and greater adoption of managed services.
Other
The Other category of the Global IT Managed Services Market includes various industries that utilize IT services but may not have a dominant presence individually. This category may include sectors such as manufacturing, education, energy, and utilities. While these industries require IT services, they may not generate as much demand for IT managed services as the government, BFSI, retail, logistics, healthcare, and lifesciences sectors. Therefore, while the Other part contributes to the overall market, it is not expected to dominate the Global IT Managed Services Market.
Insights on Regional Analysis:
Asia Pacific
Asia Pacific is expected to dominate the Global IT Managed Services market. This region has witnessed significant growth in the IT industry, with countries like China and India emerging as major players. The increasing adoption of cloud computing, big data analytics, and IoT technologies is driving the demand for IT Managed Services in the region. Furthermore, the presence of a large pool of talented IT professionals and the outsourcing of IT services by North American and European companies to Asia Pacific countries are contributing to its dominance in the market. With ongoing digital transformation initiatives and the growth of industries such as healthcare, manufacturing, and BFSI, Asia Pacific is poised to maintain its leading position in the Global IT Managed Services market.
North America
North America has always been at the forefront of the IT industry and is expected to hold a significant share in the Global IT Managed Services market. The region is home to many technologically advanced countries, including the United States and Canada, which have a mature IT infrastructure. The high adoption of advanced technologies, such as cloud computing, artificial intelligence, and automation, is driving the demand for IT Managed Services in North America. Additionally, the presence of large IT companies and a robust ecosystem of service providers make it a dominant player in the market. However, competition from other regions, particularly Asia Pacific, poses a challenge to North America's dominance.
Europe
Europe is another region that is expected to have a notable presence in the Global IT Managed Services market. The region has a well-established IT industry, with countries like Germany, the United Kingdom, and France being key contributors. The increasing focus on digital transformation in industries such as banking, healthcare, and manufacturing is fueling the demand for IT Managed Services in Europe. Additionally, stringent data protection regulations, such as the General Data Protection Regulation (GDPR), are driving the need for specialized managed services. However, factors such as economic uncertainties and political instability in some European countries may hamper the growth potential of the IT Managed Services market in the region.
Latin America
Latin America is projected to have moderate growth in the Global IT Managed Services market. The region is witnessing increasing digitalization and technology adoption, particularly in countries like Brazil and Mexico. The growing need for cost-effective IT solutions and a rising number of small and medium enterprises (SMEs) in the region are expected to drive the demand for IT Managed Services. However, challenges such as limited IT infrastructure in some areas, political and economic uncertainties, and the presence of a significant informal sector may restrict the region's dominance in the market.
Middle East & Africa
The Middle East & Africa region is expected to have a relatively smaller share in the Global IT Managed Services market. While countries like the United Arab Emirates and South Africa have a relatively mature IT industry, the overall adoption of managed services in the region is still at a nascent stage. Factors such as limited IT infrastructure, lack of awareness, and cybersecurity concerns pose challenges to the growth of IT Managed Services in the Middle East & Africa. However, with increasing investments in digital transformation initiatives and the rising demand for advanced IT solutions in sectors like oil and gas, healthcare, and retail, the region has the potential for gradual growth in the IT managed services market.
Company Profiles:
Prominent entities within the worldwide IT Managed Services sector deliver holistic and cohesive offerings aimed at overseeing and enhancing IT infrastructure and operations to support uninterrupted business processes, minimize expenses, and bolster cybersecurity measures. Their service portfolio encompasses a broad spectrum of offerings such as infrastructure management, network management, security management, and application management, tailored to address the changing technological requirements of enterprises operating in diverse fields.
Leading companies in the IT Managed Services Market comprise IBM Corporation, Cisco Systems Inc., Hewlett Packard Enterprise Company, Accenture plc, Fujitsu Limited, Tata Consultancy Services Limited, Atos SE, Cognizant Technology Solutions Corporation, DXC Technology Company, and Infosys Limited. These organizations are pivotal in offering a wide range of IT managed services, encompassing infrastructure management, security management, network management, data storage and backup, and cloud services. Through their proficiency and continual technological advancements, these major players significantly contribute to the expansion and progression of the global IT managed services sector. Their well-established presence and dominant market positioning deem them critical contributors in fulfilling the escalating need for managed IT services across businesses of varied scales and sectors.
COVID-19 Impact and Market Status:
The global demand for IT managed services has surged as a result of the Covid-19 pandemic, driven by the rise in remote working and the necessity for dependable infrastructure assistance.
The emergence of the COVID-19 pandemic has significantly impacted the IT managed services sector. The enforcement of lockdowns and social distancing by governments necessitated a swift transition to remote work setups across diverse industries. This abrupt shift underscored the critical importance of having robust IT infrastructure and support systems in place. Consequently, organizations increasingly engaged IT managed service providers to ensure continuous business operations and technological upkeep. There was a notable uptick in the demand for services like cloud computing, network security, data backup, and disaster recovery as companies prioritized safeguarding their digital functions. The ened reliance on digital platforms for remote communication and collaboration introduced fresh cybersecurity concerns, propelling an increased need for managed security services. However, the pandemic-triggered economic downturn compelled some enterprises to reduce IT spending, resulting in a varied performance within the market. In summation, the COVID-19 crisis spurred the accelerated uptake of IT managed services while presenting financial hurdles for certain service providers.
Latest Trends and Innovation:
- On February 10, 2021, IBM announced the acquisition of Taos, a company specialized in providing Managed IT Services.
- On March 18, 2021, Accenture completed the acquisition of LEXTA, an independent IT consultancy firm, expanding its capabilities in IT managed services.
- On April 1, 2021, Fujitsu announced the acquisition of Infinity Works, a technology consultancy firm focused on IT Managed Services.
- On July 27, 2021, Wipro Limited acquired Ampion, an Australian provider of cybersecurity, DevOps, and quality engineering services.
- On September 8, 2021, HCL Technologies acquired DWS Limited, an Australian IT services and solutions provider, strengthening its position in the IT managed services market.
- On November 15, 2021, CGI announced the acquisition of Sense Corp, a leading consulting firm specialized in digital transformations and IT managed services.
- On December 1, 2021, Atos completed the acquisition of Visual BI, a leading provider of business intelligence and analytics solutions, enhancing its IT managed services portfolio.
- On December 17, 2021, Cognizant acquired DLT Solutions, a premier U.S. provider of cloud solutions and managed services, complementing its existing IT services offerings.
Significant Growth Factors:
The expansion of the IT managed services industry can be linked to various factors including the growing use of cloud computing, escalating worries about cybersecurity, and the demand for affordable IT services.
The market for IT Managed Services is witnessing remarkable expansion driven by various critical factors. The complexity of IT infrastructures in organizations spanning different sectors is on the rise, fostering a ened demand for managed services. The advent of innovative technologies like cloud computing and big data analytics mandates specialized skills for effective management and upkeep of these systems. Additionally, a growing emphasis on cost reduction and operational efficacy is prompting businesses to opt for managed services, recognizing the potential savings associated with outsourcing IT operations and leveraging the expertise and economies of scale offered by service providers. The escalation in both the frequency and sophistication of cyber threats has compelled enterprises to invest in managed security services to safeguard their sensitive data and IT infrastructure. Moreover, the global scarcity of proficient IT professionals is steering organizations towards managed service providers as a viable and dependable solution for their IT needs. Lastly, the surge in remote work practices and virtualization in the aftermath of the COVID-19 pandemic is further amplifying the demand for IT managed services, as companies pivot towards remote technical support, network monitoring, and cloud-based solutions. In essence, the notable growth catalysts for the IT Managed Services market encompass the evolving IT landscape, cost-saving imperatives, cybersecurity concerns, talent shortages, and the evolving work environment characterized by remote operations and virtualization.
Restraining Factors:
The expansion of IT infrastructure complexity and the dearth of proficient professionals to manage them efficiently constrain the IT Managed Services Market.
The IT managed services sector has demonstrated significant growth in recent years, yet several inhibiting factors warrant consideration. Cost emerges as a primary concern for many companies, particularly small and medium-sized enterprises with constrained budgets. The substantial expenses associated with IT managed services often impede their adoption, leading to sluggish market expansion. Furthermore, security apprehensions present a notable obstacle. With businesses increasingly reliant on technology for their operations, the threat of cyber attacks and data breaches looms large, influencing decision-making processes. Many enterprises exhibit hesitance towards outsourcing IT management, fearing potential vulnerabilities it may expose them to. Additionally, the ever-evolving nature of technology can act as a constraint. The rapid pace of advancements in the IT industry renders services and technologies quickly obsolete, challenging businesses to stay abreast of current trends and maintain competitiveness. Lastly, a lack of awareness and comprehension regarding the advantages of IT managed services poses another barrier. Some business leaders and decision-makers may not fully grasp the value that outsourcing IT management could bring to their operations. Despite these hurdles, there is reason for optimism. The growing dependence on technology, the complexity of IT infrastructures, and the requisite for specialized expertise are poised to propel the demand for IT managed services in the future. As organizations recognize the potential advantages in terms of cost-effectiveness, ened security, and enhanced efficiency, they are likely to surmount these inhibitory factors and embrace the managed services landscape.
Key Segments of the IT Managed Services Market
Type Overview
• Cloud-Based
• On-Premise
Application Overview
• BFSI
• Retail
• Logistics
• Healthcare and Lifesciences
• Government
• IT and Telecom
• Other
Regional Overview
North America
• US
• Canada
• Mexico
Europe
• Germany
• France
• UK
• Rest of Europe
Asia Pacific
• China
• Japan
• India
• Rest of Asia Pacific
Middle East and Africa
• Saudi Arabia
• UAE
• Rest of Middle East and Africa
Latin America
• Brazil
• Argentina
• Rest of Latin America
Frequently Asked Questions (FAQ) :
The global IT managed services market size is predicted to reach over USD 501.37 billion by 2031.
The IT managed services market is expected to grow at 7.94% during the forecast period.
The IT Managed Services Market is studied from 2018 - 2031.
IBM Corporation, Cisco Systems Inc., Hewlett Packard Enterprise Company, Accenture plc, Fujitsu Limited, Tata Consultancy Services Limited, Atos SE, Cognizant Technology Solutions Corporation, DXC Technology Company, and Infosys Limited.
The base year for the report is 2023.