Cloud Managed Services Market Size, Share & Trend Report

Cloud Managed Services Market Size, Share & Trend Analysis Report By Service Type (Business, Network), By Deployment, By End-user, By Vertical, By Region, And Segment Forecasts, 2018 - 2025

  • Published Date: Apr, 2018
  • Base Year for Estimate: 2016
  • Report ID: GVR-2-68038-221-1
  • Format: Electronic (PDF)
  • Historical Data: 2014-2016
  • Number of Pages: 110

Industry Insights

The global cloud managed services market size was valued at USD 23.19 billion in 2016 and is expected to increase at an expected CAGR of 15.4% over the forecast period. Growing emphasis on mobility coupled with the requirement to focus on core business functions will drive the market growth rate. Also, increasing demand for scalability and reliability will further elevate the demand for the services as it will enable enterprises in scaling-up and down their operations by offering custom-made offerings to the available services.

Enterprises are more concerned with IT costs reduction which will fuel the demand in future. Services being offered on the pay-as-you-go model, where enterprises are charged as per their use of the resources, will enable enterprises to save on costs and will provide flexibility.

U.S. cloud managed services market

There are several other benefits of cloud managed services such as enhanced IT functionality and customized IT services. Availability of robust infrastructure will remain a key concern for service providers as uninterrupted internet connectivity is required for services delivery. Simultaneous access from multiple users to the cloud might result into network congestion which can hamper the internet speed and can lead to a downtime. Massive load from multiple client access on server might result in power failure which can disrupt business operations temporarily.

Poor infrastructure and connectivity in developing regional markets such as in India, Mexico, and MEA will remain the biggest challenge for the market to grow. Also, data privacy and data security over the cloud will restrain the market growth. Additionally, cost-sensitive enterprises may refrain from investing in these services owing to the initial high cost of installation and maintenance.

Vendor lock-in is another primary concern for the service providers. Signing new contracts might include substantial charges along with applications reconfigurations. In such cases, platform compatibility can be another concern as applications that are developed on one platform might not be supported on other platforms.

Service Type Insights

In service type segments, the mobility services will be the segment which will increase with the highest growth rate. Increase in trends such as Bring Your Own Devices (BYOD) and mobile workforce will impel enterprises to implement services to manage both devices and data. Increasing adoption of portable and mobile devices in enterprises will further drive the growth of this segment.

The security services segment is expected to grow at a CAGR of over 18% during the forecast period. This growth can be attributed to the adoption of cloud technologies. The data in cloud becomes more vulnerable as the number of users with access to the cloud increases. It will drive the demand for security services.

Deployment Insights

The private cloud offers several benefits to the enterprises such as increased data security and access control. This model further provides enterprises with benefits such as costs efficiency, and reliability, however, costs associated with private cloud model are high.

Unlike private cloud, public cloud requires a low cost of deployment, are easy to configure and offer economies of scale to the enterprises. The market size for public cloud segment contributed USD 15 billion in 2016 and is expected to increase with an expected CAGR of 14% over the forecast period.

End-User Insights

Cloud managed services help enterprises to reduce the IT costs. These services are offered on the basis of the pay-as-you-go model. These services also enable enterprises to achieve economies of scale by collaborating with employees on the go. It increases enterprise capabilities regarding flexibility, communication, and reliability.

Cloud managed services have increased the operational efficiency of small- and medium-sized organizations by managing their IT infrastructure. They enable organizations to focus on their core business practices, which further enhances their productivity.

Cloud managed services market

Customizations provided to organizations by the service providers are enabling them to experience flexibility. These factors are expected to drive the adoption of cloud managed services by SMEs. The segment market size was valued at USD 6 billion in 2016 and is expected to grow with a CAGR of 20% over the forecast period.

Vertical Insights

The increased adoption of cloud in the healthcare industry is driving the demand for cloud managed services. A significant amount of data has been generated due to research-related activities and healthcare operations in the recent past. The management of this data requires expertise in cloud and hence, healthcare service providers seek cloud managed service providers. Cloud managed services helps healthcare service providers to focus on their core processes.

The retail & consumer segment is another major segment which will witness significant growth during the forecast period. The market size of the segment is expected to increase with a CAGR of over 17% during the forecast period. Tailor-made offerings from service providers enable retailers to scale-up and down the business operations.

Regional Insights

North America held the largest market share in 2016 and is expected to witness significant growth over the forecast period, owing to the presence of technology giants such as IBM, Google, Cisco Systems and Verizon Communications. Initiatives by the federal government are increasing the adoption of cloud managed services. In Europe, several governments are working with various organizations and other countries to increase the cloud adoption. Government initiatives such as UK government's G-Cloud framework is enabling the government to utilize cloud managed services.

The Asia Pacific is expected to be the fastest-growing region over the forecast period, owing to the growing adoption of cloud managed services by the small and medium-sized enterprises, which are expected to drive the market growth. Increasing investments by prominent players such as IBM and Google are bolstering the growth of cloud adoption and hence growth for cloud managed services market.

Cloud Managed Services Market Share Insights     

Cisco Systems Inc., IBM, Ericsson, Accenture PLC, Verizon Communications Inc., NTT Data Corporation, CenturyLink and Fujitsu Limited, are some of the most prominent players in the market. These players are adopting several strategies to grow in the market. Collaborations with other players, partnerships, and investments in R&D are some of the most widespread strategies.

Mergers & acquisitions and new product/service development is another major strategy being adopted by the existing players. For example, IBM acquired SoftLayer in 2013 for USD 2 billion. The acquisition helped IBM to strengthen cloud computing capabilities.

Report Scope

 Attribute

Details

Base year for estimation

2016

Actual estimates/Historical data

2014 - 2016

Forecast period

2017 - 2025

Market representation

Revenue in USD Million & CAGR from 2017 to 2025

Regional scope

North America, Europe, Asia Pacific, Latin America, and MEA

Country scope

U.S., Canada, UK, Germany, India, Japan and China

Report coverage

Revenue forecast, company ranking, competitive landscape, growth factors, and trends

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Segments Covered in the Report

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the industry trends in each of the sub-segments from 2016 to 2025. For this study, Grand View Research has segmented the global cloud managed services market report based on types, deployments, end-users, verticals, and regions:

  • Service Type Outlook (Revenue, USD Million; 2014 - 2025)

    • Business

    • Network

    • Security

    • Data Center

    • Mobility

  • Cloud Deployment Outlook (Revenue, USD Million; 2014 - 2025)

    • Public

    • Private

  • End-User Outlook (Revenue, USD Million; 2014 - 2025)

    • SMEs

    • Large Enterprises

  • Vertical Outlook (Revenue, USD Million; 2014 - 2025)

    • Telecom & ITES

    • Government (State & Local, Federal) & Education

    • BFSI

    • Retail & Consumer

    • Healthcare

    • Manufacturing & Automotive

    • Others (Media, Transportation, Food & Beverages, Oil & Gas, Real Estate)          

  • Regional Outlook (Revenue, USD Million; 2014 - 2025)

    • North America

      • U.S.

      • Canada

    • Europe

      • UK

      • Germany

    • Asia Pacific

      • China

      • India

      • Japan

    • Latin America

    • Middle East & Africa (MEA)

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