United States Managed Services Market Size & Share Analysis - Growth Trends & Forecasts (2023 - 2028)

United States Managed Services Market Size & Share Analysis - Growth Trends & Forecasts (2023 - 2028)

The United States Managed Services Market size is expected to grow from USD 54.44 billion in 2023 to USD 88.48 billion by 2028, at a CAGR of 10.20% during the forecast period (2023-2028).

Managed services allow businesses to focus more on their core competencies while improving operational efficiency and cutting operating costs. Managed services give optimal resource allocation and utilization, which improves overall profitability and operational efficiency. Much of the scalable infrastructure and managed services models make it easier for organizations to adopt new technologies. These variables are expected to fuel market expansion over the forecast period.

Key Highlights

• The Internet of Things has prompted businesses to reevaluate how their customers obtain information today and deliberate on how to reach them best. Every year, millions of gadgets connect to the internet, further complicating an already complicated landscape, let alone the integration challenges and cyber threats provided by many channels. Managed service providers may increase security for each tier of the IoT ecosystem here. A Managed Service Provider (MSP) may help enterprises embrace IoT for innovation and keep one step ahead of the technology curve by providing qualified resources and round-the-clock support services.
• Internal operations and those that interface with customers can be transformed and improved through hybrid IT. Over the past ten years, it has been abundantly evident that businesses from all industries recognize how important hybrid IT capabilities are to their ability to prosper in this more digitally-focused era. The pandemic considerably hastened this trend. The important components in building the digital infrastructure for the connected society are strong computing, adaptability, cyber security, and collaboration. Managed services assist firms in building a robust IT infrastructure that offers the finest scalability, agility, flexibility, and security controls capable of altering to meet changing business requirements by combining these four components.
• Businesses in all market segments are keen to use automation, analytics, and other next-generation technology to develop new opportunities and increase efficiency. But at the same time, the unstable economic environment requires many organizations to exercise more remarkable financial restraint. Addressing these conflicting goals requires the use of managed services. Managed service providers (MSPs), in addition to offering the necessary knowledge to operate increasingly sophisticated company systems, often give significant financial advantages. According to a recent IBM research report, approximately 27% of businesses outsource to cut costs. According to an MIT Sloan Management Review study, non-IT operating expenses decreased by USD 121.14 million, while the cost of outsourcing IT rose to USD 96.14 million.
• In an MSP relationship, excellent customer service and support ought to be taken for granted. Businesses prefer to outsource IT because they need outside professionals to provide top-notch services and technical support. MSPs do, however, face a number of difficulties, including staffing and capacity problems. It is difficult to get technical talent, and IT salaries are rising quickly. Many MSPs struggle to keep their workers and pay them fairly. In addition, some MSPs merely find it difficult to satisfy the ongoing daily service requirements of their clients.
• As businesses recover from the pandemic, many IT leaders in the United States have expanded the adoption and implementation of innovative technologies to foster innovation. The hour needs to identify problems before they cause a significant breakdown. Firms can safeguard their desktops and data, carry devices, save time, increase security, administer applications, and carry out business continuity and disaster recovery to preserve their most vital resource with effective managed services.
• The demand for work-from-home measures post-COVID-19 is expected to drive the market studied. For instance, according to the Zippia survey 2022, as of 2022, 26% of US employees worked remotely. By 2025, 36.2 million American employees are likely to work remotely. About 40% of workers feel they were more productive working from home rather than at the office during the pandemic, and 16% of enterprises in the United States are completely remote. Remote employment now accounts for 15% of all job opportunities in the United States.

US Managed Services Market Trends

Managed Security Services to Witness Significant Growth

• The region faces a significant number of DDoS attacks, which are likely to increase concerning multiple end-user industries, further driving the demand for protection solutions. Moreover, cyberattacks in the region, especially in the United States, are increasing rapidly. They are reaching high numbers, primarily due to the region's rapidly increasing number of connected devices.
• Digital transformation is propelling the convergence of networking and security as technology teams recognize the challenges of managing and protecting increasingly complex networks and the connections that support them. According to Keeper Security Software company, 34% of respondents from the United States stated that digital transformation was one of the main cyber security concerns in 2022.
• In addition, networking and security needs are changing for customers with the current hyper-distributed workforce as more employees access the network from unique locations and various devices. Organizations are looking for a solution based on SASE principles to solve these challenges through point product consolidation, identity-based access, and worldwide points of presence to support the new and highly distributed workforce.
• In the United States, consumers have been using public clouds, and multiple mobile applications are preloaded with personal information for the convenience of banking, shopping, and communication. In the past few years, companies in the region have been witnessing increasing DDoS attacks, which has resulted in tremendous awareness related to protection solutions.
• In October 2022, cybersecurity solution provider Check Point Software Technologies Ltd unveiled a new Managed Security Service Providers (MSSPs) Program that reduces administrative constraints and supports a partner service-led approach. The program provides partners with the tools necessary for thorough XDR/XPR, MDR/MPR, events management, SOC certainty, and operational peace of mind with Check Point's industry-leading prevention-first security operations suite, Horizon. Partners can increase their profitability and organizational security with the MSSP program.
• In May 2022, OculusIT, the top managed IT and cloud services provider for higher education with over 15 years of expertise, signed a three-year Managed Security Services Provider Master Services Agreement with Trinity University in San Antonio, Texas. In the market for managed security services, OculusIT outperformed and outbid other top-tier providers in North America. Through the engagement, OculusIT will strengthen its position as the Managed Security Services Provider (MSSP) of record for Trinity University and provide professional services that align with the scope of work.

Healthcare to be the Fastest-growing End-user Vertical

• The availability of cloud-based healthcare systems and mobile applications is driving the adoption of managed services across healthcare groups through data management solutions, enabling remote access to patient information. Implementing ITSM solutions in healthcare can minimize paperwork, reduce errors, and ease compiling reports. It complies with healthcare data-keeping regulations and enables various departments to help mitigate such risks, as vast amounts of data can be integrated from the healthcare platform.
• The application of MSP helps organize medical records, which can be accessed by multiple people across the healthcare organization. These records are managed through a common platform to prevent medical errors. Furthermore, the pandemic dramatically increased the need for hospitals and healthcare amenities worldwide. This growth, fueled by the pandemic, improved the sector's adoption rate of IT services by a considerable margin. It has led the market players to indulge in various strategic activities to improve their services, reach, and customer base.
• As regulatory bodies, such as HIPPA, emphasize patient privacy, implementing rights-based security (which enables data authorization access) through digital document management could help prevent past patient records from being lost. Also, the governing bodies across emerging regions, like the Centers for Medicare and Medicaid Services in the United States, have mandated electronic health records (EHRs), thereby imposing regulations that focus on data sharing and interoperability across the organizations.
• In December 2022, an integrated health system based in Illinois, Carle Health, teamed up with Health Catalyst, a healthcare data and analytics technology business, to strengthen its analytics capabilities and improve patient care. The five-year agreement will extend the two organizations' existing connection by providing Carle Health with an all-access technology subscription and managed services in analytics, data management, reporting, and project management.
• Furthermore, the convergence of IT services and medical fields reflects the emergence of seamlessly-connected sensors and devices that can improve healthcare services and promote expectation-improved IoT utilization. The adoption of IoT in the healthcare sector and the growing demands to support M2M and M2H communication can be owed to the advancements in medical equipment, which is expected to adopt the application of managed services during the forecast period.

US Managed Services Industry Overview

The US Managed services market is dominated by major players, such as IBM Corporation, Cisco Systems, and Microsoft Corporation, among other companies, which have a strong client base in the market. These players are constantly providing increased and enhanced offerings. In order to sustain in the market and retain their clients, companies are employing powerful competitive strategies, thereby intensifying competitive rivalry in the market.

In September 2022, Fujitsu Limited announced a major overhaul to its modernization services portfolio, radically reinventing its approach to enabling clients' existing information systems to accomplish digital transformation (DX). Fujitsu will collaborate with customers to view their current assets, such as business processes, data, applications, and IT infrastructure, to develop the right DX platform while advising on system simplification and modernization.

In June 2022, with the newly managed cloud-delivered security solutions, AT&T and Check Point Software enabled businesses to support remote work. As workforces become increasingly decentralized, AT&T wants to assist companies in becoming more agile. With a set of managed cloud-delivered solutions that provide end-to-end security for all users regardless of where the "office" is, AT&T Secure Workforce with Check Point is intended to assist enterprises of any size in strengthening their defenses.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support