While business spending on all telecommunications services is expected to grow in low single-digit percentages over the next five years, global spending on managed services is expected to grow at an annual compounded rate of 11.3 percent, according to the latest market study from Insight Research.
The market research firm says global spending on managed telecom services will reach $152 billion by 2013 while U.S. revenue will increase from $34 billion in 2013 to $51 billion in 2017.
"In this period of slow economic growth and reduced spending on basic telecommunications and IT services, many enterprises will find that purchasing managed services is a cost-effective alternative to increasing internal staffing," Insight said in a press statement.
Insight's study covers five managed service segments: managed data center services, managed infrastructure, managed LAN services, managed WAN services, and managed mobility services. In addition to the revenue forecasts for these market segments, forecasts are provided for various market subdivisions, including managed IP VPNs, security services, VoIP, LAN extensions, Wireless LANs, managed mobility services, hosting and cloud services.
"A large percentage of business activity now depends on the Internet for everything from electronic commerce to intranet applications to customer service. These data applications are driving exponential traffic growth onto corporate networks, while increasing their complexity. Managed services allow corporations to handle this growth, while outsourcing the most complicated elements to the skilled service provider," says Fran Caulfield, research director for Insight Research. "Service providers also win, as they grow beyond basic transport services, increase margins, and reduce churn."