Cloud Managed Services Market Size, Share, Opportunities, And Trends By Service Type (Cloud Enablement, Cloud Migration, Management And Optimisation, Security And Compliance), By Enterprise Size (Small, Medium, Large), By End User Industry (BFSI, Healthcare, Education, Government, Communication And Technology, Others), And By Geography - Forecasts From 2024 To 2029

The cloud managed services market is predicted to grow at a CAGR of 8.82%, from estimated value of US$152.673 billion in 2024 to US$232.986 billion in 2029.

Cloud-managed services comprise an ecosystem of services such as 24/7 help desk support, operation management, engineering on demand, and hosting managed by third-party organizations. These services also include managed network operations, security operations, applications, and mobility.

Such services bolster a company’s IT applications and enable them to improve their procedures with high-recurring expenses. Increased demand for performance and scalability will boost service demand, allowing businesses to scale up and down existing operations by providing specially designed products to supplement the existing options.

Cloud Managed Service Market Drivers:

• Growing demand for improving operational efficiency drives market expansion.

Increased demand for performance and reliability will boost service demand, allowing businesses to move data between their operations by providing custom-made solutions to the services available. Companies are more focused on lowering IT expenses, fueling future demand. For instance, pay-as-you-go enables companies to use services until they want, and no payment is made in advance. Such a method saves a lot of capital for companies, as payment is only made for the resources used.

• Enhanced IT services stimulate the cloud-managed service market growth.

Cloud-managed services include improved IT functionality and customized IT services that can cater to the growing emphasis on improving network congestion caused by multiple users accessing the cloud at the same time, which can cause downtime. Companies such as Google and IBM have already started investing in this direction.

• Growing usage of Anything-as-a-Service can stimulate the overall cloud-managed service market expansion.

Anything-as-a-Service is referred to as XaaS. Platform-as-a-Service, Infrastructure-as-a-Service, and Software-as-a-Service constitute three pillars of cloud computing, offering a comprehensive range of services related to databases and networks. As end-users realize the benefits of XaaS, it is increasing faster than cloud computing.

Moreover, growing cloud computing has provided MSPs with the necessary infrastructure to manage and deliver their application and services. As a result, they can make the most of their IT budgets. Improvement in IT infrastructure has created a shift from capital to operational expenditures, lowering total ownership costs.

Cloud Managed Service Market Segmentation Analysis

• Management and optimization hold a considerable market share.

Based on the service type, the market is divided into cloud enablement, cloud migration, management, optimization, and security and compliance. Management and optimization account for a considerable share, attributable to benefits provided by services such as economic benefits, future-proofed technology, tailored and integrated service, solid infrastructure, predictable and recurrent monthly charges, centralized services and applications, and availability across all service levels.

As cloud use grows, businesses increasingly rely on SaaS apps like business software suites, sales networks, and even Google suites as a centralized platform. As businesses become more aware of the cloud's intrinsic benefits, such as cost savings and mobility, they turn to it for data security.

• Large enterprise holds a considerable share of the market.

The cloud-managed service market is segmented by enterprise size into small, medium, and large. The latter is projected to hold a significant market share, fuelled by the growing investments in improving MNCs' IT infrastructure. Managed services have primarily been provided for broadband connections, security services, IP communications, VPNs, data centers, security, and mobility, which have been popular among smaller businesses.

• BFSI is expected to grow at a rapid rate.

Based on the end-user industry, the cloud-managed market is divided into BFSI, healthcare, education, government, communication and Technology, and others. The BFSI sector is projected to show the quickest growth, fuelled by ongoing collaborations to digitize the banking sector in major economies such as the USA and investments in cloud computing.

By evaluating transactional data to assess risks based on market activity and scoring consumers and future clients, big data solutions enable organizations to make educated decisions, allowing them to make better decisions. Major financial institutions, namely BNY Mellon, Bank of America Inc., and Morgan Stanley have started implementing a data-centric approach in their operations, which is further expected to bolster the overall segment growth.

• Asia is projected to hold a significant share.

During the projection period, the APAC region is expected to see substantial expansion fuelled by the increased investment in cloud computing and favorable initiatives to digitize the economy, such as “Industry 4.0”. Moreover, due to the increased acceptance of cloud-managed services by small and medium-sized organizations, it is likely to drive market expansion. Asia Pacific is anticipated to witness the fastest region over the forecast period.

Additionally, the growing strength of SMEs, which account for a major portion of the employed workforce in major APAC economies, namely India and China, has bolstered the requirement for appropriate IT infrastructure to provide 24/7 desktop support. This has provided a wider scope for cloud-managed services in the region.

Cloud Managed Service Market Restraints:

• Privacy and safety concerns restrain the market expansion.

Cloud-managed services entail outsourcing various third parties' skills, such as cloud endpoints, networks, databases, and virtualization infrastructure. This might raise privacy and safety concerns as any cloud MSP can easily leak confidential & sensitive business information with this. The market's largest problem will continue to be poor infrastructure and connectivity in expanding regional markets like the Middle East and North Africa.

Cloud Managed Service Market Key Developments

• January 2024: Hitachi Vantara, in collaboration with Cisco, launched an innovative suite of cloud-managed services, namely “Hitachi EverFlex’ and “Cisco Powered Hybrid Cloud”. These are designed to address ongoing data management issues faced by the organizations.
• October 2023: Rackspace Technology announced the launch of “Rackspace Managed Cloud”, a comprehensive service that enables customers to fully outsource their cloud environment’s operations & management. It caters to organizations working on Google Cloud, Azure, AWS, and Rackspace private cloud.
• March 2023: de Novo Solutions launched “Value as a Service™”, a next-generation cloud-managed service for Service Now and Oracle SaaS cloud applications. VaaS includes a complete portal that ensures consistent and smooth communication for businesses at all levels. 

Cloud Managed Services Market Scope:

The Cloud Managed Service market is segmented and analyzed as follows:

• By Service Type
  • Cloud Enablement
  • Cloud Migration
  • Management and Optimization
  • Security and Compliance
• By Enterprise Size
  • Small
  • Medium
  • Large
• By End-User Industry
  • BFSI
  • Healthcare
  • Education
  • Government
  • Communication and Technology
  • Others
• By Geography
  • North America
    • USA
    • Canada
    • Mexico
  • South America
    • Brazil
    • Argentina
    • Others
  • Europe
    • Germany
    • France
    • United Kingdom
    • Italy
    • Others
  • Middle East and Africa
    • UAE
    • Saudi Arabia
    • Israel
    • Others
  • Asia Pacific
    • China
    • India
    • Japan
    • South Korea
    • Taiwan
    • Thailand
    • Indonesia
    • Others