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The State of the MSP Market

The MSP Association yesterday announced key findings of a META Group multi-client research study on the MSP market. The study, titled Managed Services: Optimizing Core Competencies, was conducted to provide information about the current state of the MSP market, the decision-making process for managed/management services and the most important factors in selecting vendors.

"The MSP market is beginning to mature, with users understanding it as a form of selective outsourcing and a business model, as opposed to a vendor description. However, we see the business moving more toward larger vendors, with partners assisting in the delivery of services," said Corey Ferengul, vice president with META Group's Service Management Strategies service and one of the authors of the study,

Other findings of the study, according to the association, include the following:

  • Primary drivers for companies considering selective IT outsourcing include lack of internal resources, desire to focus on core competencies, lack of internal skills and cost reduction.

  • Companies looking to outsource select IT functions are looking to the MSP model for viable and strong alternatives to buying and implementing management tools on their own.

  • Enterprises are outsourcing select IT functions and will continue to do so for new applications and Web-based applications rather than for existing applications where there has been a significant previous investment.

  • The areas within managed/management services most likely to be outsourced in the next year include managed hosting, virtual private network (VPN) management, desktop management, network management, Web site monitoring/reporting, intrusion detection monitoring/management and help desk/problem management.

  • Customers want custom service level agreements (SLAs). They expect technology-related SLAs but want vendors to commit to service levels around the customer service they are delivering, not just around the technologies they are managing.

Based in Concord, Mass., the MSP Association Inc. is an international consortium made up of MSPs and vendors with solutions for IT management, security, storage and outsourcing services.

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