As we near the end of 2020, it will go down in history as a year of general upheaval for all walks of life. As is the case with other major events in the world, COVID also dealt a major blow to businesses. We have already covered in great detail how cloud services have come to the aid of businesses all over the world. Managed Services Providers (MSPs) have played a pivotal role in how businesses all over the world have coped with the pandemic. However, there is another trend that MSPs need to keep in mind. This is what we aim to discuss today.
While cloud services delivered by MSPs have helped businesses continue operations, the void in the market remains. So much so that at a time when the world is possibly facing another phase of economic slowdown, cloud services sector continues to display the promise of growth. A report presented by Allied Market Research states that the global cloud services market will grow at a compound annual growth rate of 16.4% from 2020 to 2027. Fueled by this growth, the cloud services market size will grow from $264.80 billion (for 2019) to $927.51 billion by 2027.
IT Spending and Cloud Growth
As is obvious from the numbers presented above, cloud services market size is expected to nearly quadruple in the coming years. However, COVID-19 has also brought budget shrinkages for almost all major enterprises, and IT budgets have been no exception. Hence, skepticism regarding the numbers presented above is only natural. Nonetheless, recent research points toward the contrary.
A report by Gartner states that IT spending worldwide came down by 5.4 percent in 2020 as compared to 2019. IT spending came down from $3.8 trillion in 2019 to $3.6 trillion in 2020. While there has been a reduction in IT spending by enterprises, investment in cloud services has only increased. A report by Markets and Markets states that cloud services market size will increase to $295 billion by 2021, up from $233 billion in 2019.
What Should MSPs Focus on?
The figures we saw above state that IT spending might be in for a minor hit, but enterprises are rapidly adopting cloud services. MSPs need to capitalize on the trend of enterprises going for expedited digitalization even as IT budgets shrink. Multiple agencies have made forecasts regarding the growth of cloud sector, and all the forecasts are positive.
This is where things get critical for MSPs as merely offering cloud services to their customers is not going to prove adequate during these times of budget crunch. MSPs need to look beyond the traditional service delivery model and ensure that they also deliver value to their customers. Striking the right partnerships — whether with cloud management solution providers or cloud services providers — is the way ahead for MSPs.
Becoming a part of partner programs offered by major cloud providers such as AWS MSP Partner Program or Microsoft Azure Expert MSP program will be of critical importance to MSPs looking to grow. On the other hand, ensuring proper integration of solutions along with services so as to offer their customers a value-rich experience rather than delivering services in bits and pieces will also prove critical for the growth of MSPs.
This is where Centilytics — an intelligent cloud management platform — comes in with its own set of partner programs aimed at enabling MSPs to deliver value-rich solutions to its customers. Our comprehensive partner programs take care of every aspect related to establishing long-term and mutually beneficial partnerships with customers. Click here for a free trial.