Customer views of managed services, cloud providers changing
Cloud services will continue to be central to MSPs and their businesses, but the managed service providers will have to determine how to position their services as customers evolve their cloud strategies, according to analysts with IDC.
The Lowdown: In the market research firm’s Managed CloudView 2019 report released this month, the analysts found that enterprises are changing their expectations of both public cloud service providers and their MSPs. Those changes are impacting how enterprises consume cloud services, so MSPs will have to adapt their business models to ensure they continue to meet their customers’ needs.
The Details: For its report, IDC surveyed 1,500 organizations, including both IT and line-of-business respondents. Among the findings from the survey:
> Changing views of MSPs and hyperscale public cloud providers: Enterprises are looking to MSPs to help with the transformation around cloud and multicloud requirements, while cloud providers are becoming more strategic partners in such key service areas as making it easier to integrate with public clouds, availability, and rapid application provisioning.
> Shift in sourcing strategies: Most organizations expect to increase the number of public cloud providers they use and 68% said they plan to consolidate the number of MSPs.
> Using MSPs for PaaS support: Enterprises will rely heavily on MSPs to support efforts around developing cloud-native applications, and that use of open-source and containers with Platform-as-a-Service will near 50% of enterprise application portfolios by 2024.
> Certified use of public clouds: Most organizations would pay a premium to use managed cloud services for pubic clouds that are certified by the cloud provider. About 32% of enterprises would pay a 21% to 40% premium; 28% would pay 41% to 60%.
> Cloud business models for MSPs: Companies want MSPs to use the same business models that public cloud and Software-as-a-Service (SaaS) providers do. About 82% of organizations said MSPs need to own their own cloud platform to be successful, and 94% said MSPs need to offer SaaS capabilities.
The Buzz: “Enterprises continue to see tremendous value in utilizing managed SPs for managed cloud services to support transformation to cloud and provide multicloud management capabilities that help to orchestrate and manage across a broad array of hyperscalers and SaaS provider partners, the full range of cloud options (private, public, hybrid), and across the lifecycle of services, while supporting new innovations, critical business processes, and industry requirements,” said David Tapper, vice president of Outsourcing and Managed Cloud Services at IDC. “However, a combination of changing customer perceptions and expectations, technological innovation, and pressures emerging from coopetition between managed SPs and their ecosystem partners of hyperscalers appear to be creating a tipping point for which managed SPs need to clearly assess their market position and what their long-term roles will be in optimizing their opportunities for managed cloud services.”