The managed network services market is anticipated to witness noteworthy growth over the coming years due to favorable government initiatives on expanding internet connectivity, digitalizing businesses, expanding retail sector, and rising adoption of managed Wi-Fi services in shows and events. Rising product adoption across various application avenues such as BFSI, IT & telecom, government, and healthcare among others will also greatly contribute towards market growth.
Managed network services are known as networking applications, services, and functions that enterprises usually outsource to operate remotely, monitor as well as to be maintained by a MSP (managed service provider). These services generally range from standard network access as well as transport services such as conventional leased LAN and WAN lines to novel software-defined WAN connections along with virtual network services.
The managed network services market is segmented in terms of type, organization size, application, and regional landscape.
With respect to type, the market for managed network services is classified into managed monitoring, managed security, managed Wi-Fi, managed WAN, managed VPN, and managed LAN. Among these, managed Wi-Fi segment is likely to grow with a CAGR of around 18.1% over the forecast timeframe. Managed Wi-Fi services are increasingly being used for providing Wi-Fi hotspot services to attendees in shows and events with high speed and density.
In 2020, the managed security segment accounted for an overall market share of 11.36% and is estimated to follow a strong growth trend over the coming years. This projected growth is ascribed to the increasing cybersecurity concerns and strict data privacy laws.
Meanwhile, the managed monitoring segment is expected to witness around 6% CAGR through the analysis time period as these services are deployed to decrease network downtimes and to provide uninterrupted network connectivity for critical business requirements.
In terms of application, the overall managed network services market is categorized into retail & consumer goods, government, manufacturing, healthcare, BFSI, and IT & telecom. In 2020, IT & telecom segment held over 30% market share and expected to showcase a promising growth rate during the study period. The high demand for managed network services in the IT & telecom sector is mainly due to the growth of 4G technology as well as the upcoming 5G technology.
BFSI segment held over 19% industry share in 2020 and will showcase robust growth over the coming time period. The growing need to manage the rising network complexity with the increasing demand for network security are some of the factors that are likely to drive the BFSI segment growth.
Meanwhile, the government application segment will witness a respectable CAGR of over 9% through the forecast time period as governments are deploying modern technologies. They are also heavily investing in network expansion.
On the geographical front, managed network services market in Latin America is projected to grow at 10% CAGR over the analysis timeline. The regional growth is driven by government initiatives on expanding rural internet connectivity, digitalizing businesses across the region, and providing e-citizen services.
Meanwhile, the MEA managed network services market is expected to grow at a CAGR of 11% through the analysis timeframe. The growth is majorly ascribed to the advent of numerous small-scale IT firms coupled with robust retail sector.