Abstract
Report Synopsis
Market forces have conspired to create a new space in managed services.
Briefly entered then exited by telcos and ASPs following the dot.com collapse,
managed services have emerged as an opportunity experiencing growth from a
small base, and currently running at 20% per annum.
This new report assesses for the first time the Managed Services market in
Europe and draws upon a survey of 80 players across the region. Interviews
were conducted with the 7 types of player engaged in the managed services
space including data centres, systems integrators, hardware and software
vendors, telcos and ISPs.
The speed of change in managed services is matched only by the rate of
barriers to entry falling. It is characterised too by the number of new
entrants converging in the space from outside traditional integrators and
professional services companies, including the Data Centre provider and
Telcos. The volume of new entrants demonstrates the compelling attraction
across all segments for longer-term recurring, sustainable rental revenues.
Growth drivers are found in changes occurring in the Enterprise; provider
players are seeking new sources of rental income and mitigation of revenue
declines in traditional businesses. As large scale outsourcing appears to be
on the wane, Enterprises are seeking new alternatives including multisourcing
and near-shoring.
Competitors in the managed service space are encountering challenges in the
delivery of managed services, and at a time of further change in technologies.
New business models are emerging as utility computing and on-demand services
are being invested in and tested.
Finding that Enterprises are increasingly receptive to partial third-party
management of infrastructure and assets, players who have have moved into the
managed service space will confront the need to choose between the delivery of
standardised or customised solutions. In doing so, the importance of
collaborative partnerships for all players is emphasised throughout the
report, even though this may result in other trade-offs.
The report observes that migrating to managed services requires investment as
well as acceptance of risk. Competition is intensifying, the cost of sales and
channels and pressure to produce standardised products is increasing. In
addition, the emergence of "on-demand" or pay-as-you-go IT models is occurring
as providers attempt to broaden acceptance of hosted services.
Evidence gathered for the report suggests that Telecom Providers will
eventually dominate the hosting market due to their business scale and
customer-market presence, taking approximately 32% market share by 2011.
Although all service providers will benefit from the adoption of managed
services, Data Centres stand to gain extensively by providing carrier neutral
space to the System Integrators and Hosting providers. This argument runs
counter to the view that Data Centres will gain most by providing managed
services directly to the enterprise customer. Data Centre revenue share for
direct end user managed services will be relatively small but for those
positioned with blade servers the opportunity to acquire further revenues will
be high.
The report is a tour-de-force carrying the reader across the all-important
player segments, assessing their strengths and weaknesses and the challenges
they confront in the quest to provide managed services. The research
identifies key trends and new issues -- software as a service, utility
computing, hosted applications, seismic changes in the integrator market, VoIP
and the integration of LAN and WAN and the criticality of managed services not
yet fully recognised among players seeking to define market positions in the
space.
Table of Contents
- Executive Summary
- CHAPTER ONE -- INTRODUCTION TO THE CONCEPT OF MANAGED SERVICES
- 1.1 Definition of Managed Services
- 1.2 Types of Managed Service Providers
- 1.3 The Shift to generic Managed Services
- 1.4 Has the tide turned for Managed Services?
- 1.5 Managed Services Value Chain
- 1.6 Conclusion -- Market Trends in Managed Services
- CHAPTER TWO -- THE MANAGED SERVICES MARKET MODEL
- 2.1 Managed Services Model
- 2.2 Strategic Product -- Market Options
- 2.3 Market Competitor Segmentation
- 2.4 Service Elements required to successfully provide a Managed Service
- 2.5 Conditions of Service
- 2.6 Analysis of Competitor Segments and Generic SWOT
- 2.6.1 Data Centre Providers
- 2.6.2 Telecom Providers
- 2.6.3 Dedicated Hosting Providers
- 2.6.4 Specialist Disaster Recovery and Business Continuity Provider
- 2.6.5 Systems Integrators
- 2.6.6 Software Providers
- 2.6.7 Hardware and Equipment Vendors
- 2.7 Summary of Key Reasons to shift into the Manage Services space
- 2.8 Key Challenges in offering Managed Services
- 2.9 Competitor Product and Service Market Positioning
- 2.10 The Managed Services Business Model
- 2.10.1 Data Centre Providers
- 2.10.2 Telecom Providers
- 2.10.3 Integrator Service Providers
- 2.10.4 Specialist Service Providers
- 2.10.5 Equipment and Hardware Vendors
- 2.10.6 Typical Service Provider Models
- 2.10.7 The Conventional Service Provider Business Model
- 2.10.8 The New "Pay As You Go" Model Compared
- 2.10.9 The Evolution of the Managed Services Model
- 2.11 Conclusion -- Challenges faced by the Managed Services Market Model
- 2.11.1 The extent of Market maturity
- 2.11.2 The fluidity of the business model
- 2.11.3 Continued development of SaaS as a new product offer
- 2.11.4 The search for the "killer application"
- CHAPTER THREE - MANAGED SERVICES - THE DATA CENTRE PROVIDER
- 3.1 The market for managed services in Data Centres
- 3.2 Types of managed service in the Data Centre
- 3.2.1 Totally managed services
- 3.2.2 An added-value service
- 3.2.3 Providing a managed service through a partner
- 3.3 Types of service provider in the Data Centre
- 3.3.1 Wholesale provision
- 3.3.2 Enterprise and Added-Value provision
- 3.3.3 Managed Services provision
- 3.3.4 Self-Build Services Provision
- 3.4 Data Centre Managed Services Hierarchy
- 3.5 Data Centre Target Markets for Managed Services
- 3.5.1 InterXion
- 3.5.2 City Lifeline
- 3.5.3 E-Shelter
- 3.5.4 Info AG
- 3.6 Core Data Centre Services
- 3.6.1 Core Data Centre and Facility Services
- 3.6.2 Networking Services
- 3.6.3 Connectivity Services
- 3.6.4 Support and Monitoring Services
- 3.6.5 Bundled Services
- 3.7 Types of Data Centre managed services
- 3.7.1 Load Balancing
- 3.7.2 Managed MS Exchange
- 3.7.3 Managed Security
- 3.7.4 Managed DR/BCP
- 3.7.5 Multi-Homed IP Platform
- 3.8 Data Centre managed service Provider Profiles
- 3.8.1 Telehouse Europe
- 3.8.2 TeleCity
- 3.8.3 The Bunker Secure Hosting
- 3.8.4 InterXion
- 3.8.5 e-Shelter
- 3.8.6 IX Europe
- 3.8.7 Sentrum
- 3.9 The emergence of new services based on automation and virtualisation
- 3.9.1 Virtualisation Trends
- 3.10 Growth prospects for Managed Services
- 3.11 Data Centre Managed Services Case Study: Carlyle Group
- 3.12 Conclusions
- CHAPTER FOUR - MANAGED SERVICES - THE TELECOMS PROVIDER
- 4.1 Telecoms Provider Service Mix
- 4.2 Evolution of Managed Services
- 4.2.1 AT&T
- 4.3 Challenges
- 4.4 Opportunities
- 4.5 Types of Managed Services Offered
- 4.6 Changing Customer Requirements
- 4.6.1 Customer Demand Trends
- 4.7 Service Trends
- 4.7.1 Managed Service categories
- 4.8 Case Study: BT Global Services
- 4.9 Rise of Pay As You Go (PAYG) Managed Services Models in the Carrier
World
- 4.10 The Development of Utility Computing Services
- 4.11 Managed Service Telecoms Provider Profiles
- 4.11.1 Interoute
- 4.11.2 Telstra Europe
- 4.11.3 MCI
- 4.11.4 COLT develops an outsourcing and hosting on-demand service
- 4.12 Growth prospects for carrier managed services
- 4.13 Trends for the Telecoms Provider in managed services market
- 4.14 Case Study: COLT Telecom
- 4.14.1 COLT Telecom Case Study
- 4.14.2 Case Study: BT -- Deploying a variety of Go To Market
Strategies for Managed Services
- 4.15 Conclusions
- CHAPTER FIVE - MANAGED SERVICES - THE HOSTING PROVIDER
- 5.1 Dedicated Hosting Providers
- 5.2 Market Segmentation
- 5.3 Macro Trends
- 5.4 The evolution of Utility Services
- 5.5 Routes to achieving differentiation
- 5.6 Dedicated Hosting Profiles
- 5.7 Application Service Provider Profiles
- 5.7.1 Savvis
- 5.7.2 Navisite
- 5.7.2.1 Navisite Case Study -- UKTV
- 5.7.3 Globix Europe
- 5.7.3.1 Customer Trends Affecting Globix's Business
- 5.8 Market Drivers for Hosting Services
- 5.9 Conclusions
- CHAPTER SIX - MANAGED SERVICES - THE DISASTER RECOVERY AND BUSINESS
CONTINUITY PROVIDER
- 6.1 Market Structure
- 6.2 Market Drivers changing the Disaster Recovery and Business
Continuity Sector
- 6.3 Barriers to provision of Disaster Recovery and Business Continuity
- 6.4 Attraction of third party Disaster Recovery and Business Continuity
suppliers
- 6.5 Market Drivers
- 6.6 Core IT management questions for the DR and BC plan
- 6.7 Managed Services for the Disaster Recovery and Business Continuity
Sectors
- 6.8 Case Study: Iron Mountain -- From Physical storage to Digital storage
- 6.9 Case Study: Changing the Business Model over time -- SunGard
- 6.10 External Customer Drivers for a Shared Disaster Recovery Service
- 6.11 Conclusions
- CHAPTER SEVEN - MANAGED SERVICES - THE SYSTEMS INTEGRATOR PROVIDER
- 7.1 Types of Integration Service
- 7.2 Key Managed Services provided by Integrators
- 7.3 Integrator Origins
- 7.4 Market Structure
- 7.5 The Integrator Market
- 7.6 Market Structure
- 7.7 Global Corporate Integrators
- 7.8 Mid-Market Integrators
- 7.9 Mid-Market Profiles
- 7.9.1 Intechnology
- 7.9.2 Attenda Limited
- 7.9.2.1 Attenda Customer Case Study: BMI
- 7.9.3 7Global
- 7.9.3.1 7Global Customer Case Study: KCS
- 7.9.4 Info AG
- 7.9.5 Cobweb Services
- 7.9.5.1 Cobweb Services Customer Case Study: Compass
- 7.10 SME Market Integrator Specialists
- 7.11 Integrator Pricing Models
- 7.12 Future Growth Prospects for Systems Integrators
- 7.13 Targtet Customers and Channels
- 7.14 Customer Drivers for Hosted Services
- 7.15 Application Hosting versus Outsourced Services
- 7.16 Trends in the Integrator Managed Service market
- 7.17 Conclusions
- CHAPTER EIGHT - MANAGED SERVICES - THE SOFTWARE SERVICES PROVIDER
- 8.1 Overview
- 8.2 Software as a Service -- an industry overview
- 8.3 Profiles
- 8.3.1 Oracle
- 8.3.2 SAP
- 8.3.3 Salesforce.com
- 8.3.4 Symantec
- 8.3.5 Microsoft
- 8.3.5.1 Microsoft -- Current Software as a Service Portfolio
- 8.4 The Twin Threats posed by Akamai and Google
- 8.5 Conclusions
- CHAPTER NINE - MANAGED SERVICES - THE EQUIPMENT AND HARDWARE PROVIDER
- 9.1 Overview
- 9.2 Business Model
- 9.3 Profiles
- 9.3.1 Ericsson
- 9.3.2 Cisco
- 9.3.3 EMC
- 9.3.4 Lucent
- 9.3.5 Sun Microsystems
- 9.3.6 Hewlett Packard
- 9.4 Forecast Growth in Managed Services for the Equipment and Hardware
provider
- 9.5 Conclusions
- CHAPTER TEN -- THE FUTURE OF MANAGED SERVICES IN EUROPE
- 10.1 The current Managed Services Market model
- 10.2 Key changes in the Managed Services market model
- 10.3 Fast Growing Managed Services
- 10.4 Risks of the New Managed Services Model
- 10.5 Future Providers of Managed Services
- 10.6 Managed Services Forecast -- 2006 to 2011
- 10.7 Forecast Assumptions
- 10.8 Conclusions
- CHAPTER ELEVEN -- CONCLUSIONS -- MANAGED SERVICES IN EUROPE
- 11.1 Managed Services is a logical service proposition
- 11.2 But it is Customer Drivers which make Managed Services an
attractive market
- 11.3 Suitability for Managed Services Provision
- 11.4 A check list for providing Managed Services
- 11.5 Key Drivers Behind the Increasing Opportunity for Managed
- 11.6 Changes in the managed services market model
- 11.7 The Future of Managed Services Revisited
- 11.8 Critical Dependencies
- 11.9 Conclusions -- Managed Services in Europe 2006-2011
