Managed Network Services Market by Service Type, Organization Size, Deployment Mode, Industry Vertical (BFSI, Retail & E-commerce, IT & Telecommunications, Manufacturing, Government, and Education), and Geography - Global Forecast to 2030

The Managed Network Services Market is set to achieve $103.9 billion by 2030, exhibiting a CAGR of 8.1% from 2024 to 2030. The market's ascent is fueled by the increased adoption of modern campus networks for accelerated service delivery, the growing demand for managed SD-WAN services, and the expanding use of managed network services to enhance productivity. However, concerns related to security and compliance may impede the market's growth. The surging demand for managed network services among small and medium-sized enterprises, coupled with the exponential growth in global IP and cloud traffic, is poised to present significant growth opportunities for stakeholders. Nonetheless, challenges include monitoring complex multi-technology physical and virtual networks, as well as obstacles in marketing and sales efforts for service providers. Moreover, the emergence of automation in network monitoring tools and the prevalence of cloud-managed network services stand out as noteworthy trends in this market.

The Impact of COVID-19 on the Managed Network Services Market

The COVID-19 pandemic created several challenges for managed network services providers, mainly due to the lockdowns imposed during the second and third quarters of 2020. The pandemic lowered consumers' financial potential, which decreased the adoption of various managed network services. However, in 2021, many enterprises and data centers started recovering from the economic setbacks suffered during the pandemic. The COVID-19 pandemic moderately impacted the managed network services market due to the delayed orders for managed SD-WAN solutions and managed LAN, WAN and VPN solutions. However, the market started recovering rapidly in the last quarter of 2020.

The Following Factors Contributed to the Growth of the Managed Network Services Market During the COVID-19 Pandemic:

• The COVID-19 crisis had an unprecedented impact on managed service providers on a global level. As businesses adapted to drastically changed work environments, the quality of collaborations and communications had a profound impact on both productivity and employee output.
• IT infrastructure giants adapted their networking infrastructures to allow employees to work remotely. The deployment of virtual private networks (VPN) provided high network bandwidths that allow for managing heavy data traffic. Thus, the COVID-19 pandemic compelled IT infrastructure providers to adopt managed VPN services, driving the growth of this market.
• Many managed network service providers and IT consultancies are in a strong position and demanding more managed network services now than ever before. However, the mass adoption of remote working policies and the effects of the pandemic on network traffic have exerted tremendous pressure on smaller service providers and captive centers that have not been as resilient as managed network service providers in managing the massive workload increases.
• During the pandemic, cost reduction was a priority, and management teams sought to leverage new technologies and improve efficiency by adopting managed network services.
• Managing regulatory obligations is complex and costly, as rules change across multiple jurisdictions and regulators demand greater transparency. Hence the demand for managed network services has increased due to the need to ensure regulatory compliance for network services.
• Managed services provide deep industry expertise and sophisticated data analytics that guide smart strategic shifts. Hence, the demand for managed network services has increased due to the rising need for successful business strategies.

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Surging Demand for Managed SD-WAN Services to Fuel Market Growth

A managed SD-WAN service is a software-defined wide area network delivered as a service that combines connectivity, orchestration, and co-manageability for agility, scalability, performance, and better cost of ownership. In recent years, various enterprises have adopted managed network services as these services ensure secure, flexible, and cost-effective networking solutions that free them from the complex task of managing multi-branch-site connectivity across a wider geographical scale. Managed SD-WAN services help accelerate application performance resulting in an improved user experience, enhanced productivity, and lower IT costs. Further, managed SD-WAN services offer notable benefits such as increased agility, simplified management, better control, increased performance, and enhanced security. The growing need for control, monitoring, and reporting capabilities across the entire network infrastructure and enabling a detailed view of current network performance and future networking requirements drive the demand for managed SD-WAN services.

Some of the Recent Key Developments in This Market Are as Follows:

• In July 2022, Amazon Web Services, Inc. (U.S.) announced the general availability of AWS Cloud WAN, a new managed wide area network (WAN) service that connects on-premises data centers, colocation facilities, branch offices, and cloud resources to simplify operating a global network.
• In May 2022, Nokia Corporation (Finland) and stc (South Africa) announced the launch of a managed SD-WAN solution, stc SD-WAN, based on Nuage Networks from Nokia’s Virtualized Network Services (VNS) platform. It will enable rapid ordering and automated configuration of network services and increase visibility and control based on the individual requirements of enterprises.

Such developments are expected to fuel the growth of the managed network services market.

Key Findings in the Managed Network Services Market Study:

The Managed Network Security Services Segment to Dominate the Market

Based on service type, in 2024, the managed network security services segment is expected to account for the largest share of the managed network services market. The large market share of this segment is attributed to the surging demand for intrusion detection & prevention systems, unified threat management systems, and the need to resolve security issues in expedient and cost-effective processes. Furthermore, the rising demand for services, including network management, monitoring, security, anti-malware, anti-spam, IP filtering, and network attack detection & prevention, and the need to devise access control policies support the growth of the managed network security services segment.

The Cloud-based Deployment Segment Projected to Register the Fastest Growth During the Forecast Period

Based on deployment mode, the cloud-based deployment segment is expected to register the higher CAGR during the forecast period. The surging need to manage complex network requirements, manage & monitor network devices, and ensure smooth network communications, security, maintenance, and migration operations are key factors driving the growth of this segment. Furthermore, the growing need to manage thousands of infrastructure devices from a single cloud instance with enhanced data capabilities, the rising demand for greater network visibility into distributed networks, and the growing need to address increasing hybrid workplace challenges, travel restrictions, and budget constraints support the growth of this segment.

The Small & Medium-sized Enterprises Segment to Witness Rapid Growth During the Forecast Period

Based on organization size, the small & medium-sized enterprises segment is expected to register the higher CAGR during the forecast period. The growth of this segment is driven by factors such as the rising need to create an agile, secure, and efficient work environment and the growing demand for SD-WAN & managed LAN services among SMEs operating in the education, retail, healthcare, and manufacturing industries. Small and medium-sized enterprises often collaborate with managed service providers as they have limited in-house IT capabilities and staff. Managed network services offer a way for organizations to access IT & networking expertise without hiring more staff.

Asia-Pacific to Be the Fastest-growing Regional Market

Asia-Pacific is projected to register the highest CAGR during the forecast period. The rapid growth of this regional market is attributed to the high growth potential in countries such as China, India, and Japan, the increasing adoption of cloud-based managed network services among small & medium-sized enterprises in the region, and the growing number of small & medium-sized enterprises across various industries in the region. Furthermore, enterprises’ surging need to outsource management functions to cloud & managed services providers is expected to propel the growth of this regional market. Also, the growing IP & cloud traffic and managed service providers’ ability to resolve complex issues associated with SD-WANs drive the growth of the managed network services market in Asia-Pacific.

Key Players

The report includes a competitive landscape based on an extensive assessment of the key growth strategies adopted by leading market participants between 2020 and 2022. The key players operating in the managed network services market include IBM Corporation (U.S.), Cisco Systems Inc. (U.S.), Microsoft Corporation (U.S.), Telefonaktiebolaget LM Ericsson (Sweden), Verizon Communications Inc. (U.S.), Huawei Technologies Co., Ltd. (China), AT & T Inc. (U.S.), Fujitsu Limited (Japan), GTT Communications, Inc. (U.S.), Global Cloud Xchange (U.K.), Sify Technologies (India), Wipro Limited (India), Lumen Technologies (U.S.), T-Systems International GmbH (Germany), and Aryaka Networks, Inc. (U.S.).

Scope of the Report:

Managed Network Services Market, by Service Type                   

• Managed LAN Services
• Managed Wi-Fi Services
• Managed WAN Services
• Managed Network Security Services
• Managed IP VPN Services
• Managed Network Monitoring Services
• Managed Data Network Services
• Managed SD-WAN Services
• Managed NFV Services
• Other Managed Network Services

Managed Network Services Market, by Organization Size

• Large Enterprises
• Small & Medium-sized Enterprises

Managed Network Services Market, by Deployment Mode

• On-premise Deployment
• Cloud-based Deployment

Managed Network Services Market, by Industry Vertical

• BFSI
• Retail & E-commerce
• IT & Telecommunications
• Manufacturing
• Government
• Education
• Healthcare
• Media & Entertainment
• Other Industry Verticals

Managed Network Services Market, by Geography

• North America
  • U.S.
  • Canada
• Europe
  • Germany
  • U.K.
  • France
  • Italy
  • Spain
  • Rest of Europe
• Asia-Pacific
  • Japan
  • China
  • India
  • South Korea
  • Rest of Asia-Pacific
• Latin America
• Middle East & Africa

Key questions answered in the report: