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Managed Hosting and Managed Services a Key Differentiator
Managed Hosting and managed service
The traditional hosting industry is in the midst of change.
Many technology vendors and service providers are realizing that they have to adapt their approach to hosting and cloud services to take advantage of emerging requirements for managed hosting.
At the same time, security and compliance burdens – complicated by changing political landscapes, legislation and regulations – are consuming enormous amounts of time and resources.
Managed services and managed hosting are rapidly emerging as key differentiators in an increasingly complex landscape of technology vendors, partners and distribution channels.
Plenty of Players
A key trend is the changing nature of providers offering managed services and hosting capabilities.
While companies focusing on domain, SSL and basic web hosting have made acquisitions or developed in-house capabilities to include network services, VPN server management, monitoring and support, others have taken a different route:
- International specialists focus on super-scale utility and price.
- Telecom carriers leverage network ownership to provide packaged offerings.
- Technology companies diversify into higher-margin service offerings and partner with other providers to offer managed service bundles.
- Systems integrators and outsourcers provide hosted infrastructure and managed services for their partner base to sell into SMBs.
451 Research’s new Managed Services & Hosting channel provides in-depth coverage of the following segments and trends in this market.
The opportunity for managed hosting services continues to grow, driven by the requirement for ‘full service’ capabilities beyond the basic management of servers and provisioning of backup-and-restore services.
Workload size, complexity and diversity have fueled the need for more advanced patching, monitoring and incident management offerings above the operating system level.
This increasingly includes, for example, line-of-business ERP systems, high-availability database clusters and email servers.
For many midmarket enterprises, managed hosting is taking over an increasingly large slice of IT as companies seek to decrease complexity in their infrastructure and focus on application provisioning and stakeholder data requirements.
Security and Compliance
Security and compliance are becoming more challenging and complicated, despite the increasing number of security tools, vendors and providers, including the relatively new category of managed security service providers (MSSPs).
Protection against ransomware, distributed denial-of-service (DDoS) attacks and botnet attacks are key demand drivers.
In addition, ever-changing political landscapes, legislation and regulations are making the difficult task of security even more arduous.
The managed services market is in flux as enterprise adoption of external managed – and unmanaged – infrastructure services goes mainstream.
There is a significant opportunity for service providers to stake ground in a number of key enterprise verticals, driven by economic pressure to adopt cloud-style IT service delivery.
The market is becoming increasingly diverse and multilayered, with providers offering managed security, backup and disaster recovery, and other services.
There are plenty of managed service providers, but the market faces disruption from privacy and data protection legislation, as well as from the rapid pace of service adoption.
Web and Application Hosting
The web and application hosting market covers an extensive range of services, from basic domain registration and management through website creation, hosting and dedicated infrastructure management.
Price pressure remains intense, largely due to competition from multi-tenant service providers.
Outside the enterprise sector, a large proportion of SMBs still have little more than a basic web presence and are seeking to benefit more from e-commerce capabilities – one of the most significant use cases for web and application hosting.
E-commerce workloads tend to have exacting requirements for performance, uptime and specific supporting technologies (e.g., SSL certificates, payment acceptance methods).
Content Delivery and Web Performance
Growing dependence on web-based applications highlights the need to ensure application performance and availability.
The content delivery network (CDN) market has been targeting R&D and VC money for further improvements in performance and delivery of dynamic content.
One area of particular momentum is mobile networks. A variety of startups are specifically targeting mobile content delivery.
Mobile networks are fueling the use of CDN infrastructure through APIs – an area that hasn’t always been a strong suit for vendors in the market.
Success in the service provider market will not come from simply adding more ‘as a service’ components to existing portfolios.
The best-positioned service providers are those that can provide high automation, rapid provisioning, and services that address complex enterprise needs – while retaining high-touch delivery and/or serving strategic regional and vertical markets.