India’s Managed Services Market Set for Remarkable Growth Despite Economic Challenges

A recent IDC Playbook for Tech Sales Leaders has shed light on the promising trajectory of India’s managed services market, forecasting a robust compound annual growth rate (CAGR) of over 9 percent in the next five years. Notably, the managed cloud services sector is poised for an extraordinary surge, projected to witness a staggering CAGR of 25 percent by 2026.
IT managed servicesDespite prevailing economic headwinds such as the Russia-Ukraine conflict, escalating wage inflation, supply chain disruptions, and looming recession concerns, the report highlights a remarkable surge in the urgency to digitize operations. This drive is fueled by the need to enhance efficiency, agility, and the speed of IT systems. Remarkably, this surge has counterbalanced the challenges posed by economic conditions, propelled by talent shortages and the growing complexity of IT and cloud management.

Neha Gupta, Senior Research Manager at IDC India’s Software and IT Services market, emphasizes, “The managed services market in India is not just weathering economic challenges; it’s thriving. The exponential growth in managed cloud services, in tandem with evolving enterprise demands, underscores the pivotal role of innovation, adaptability, and tailored solutions.”

The driving force behind this expansion is the escalating demand for hosting infrastructure services, as businesses increasingly migrate on-premises applications to cloud environments and service provider-owned data centers. Managed service providers (MSPs) are sought after for efficiently managing and optimizing infrastructure and workload performance across diverse cloud platforms.

The IDC report reflects a strong preference among respondents for vendors offering customized solutions, innovative pricing models, and robust industry capabilities. Cloud expertise and stringent security credentials further solidify vendors’ reputations for delivering tailored solutions.

As enterprises grapple with cloud operations’ complexities, IDC anticipates cloud management platforms (CMP) to take center stage, emerging as key differentiators in IT service providers’ value propositions. The proficiency of vendors in orchestrating and managing multi/hybrid cloud environments plays a pivotal role in the current technological landscape.

To navigate these trends effectively, IT vendors are advised to prioritize automation and platform utilization within managed cloud services, alongside robust resiliency capabilities like recovery and security. Incorporating multi-cloud management capabilities harnessing AIOps through cognitive and AI technologies is seen as crucial. Tailoring pricing structures to align with evolving buyer needs can offer the flexibility needed amidst inflation-induced budget constraints.

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