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The data center managed services market size is projected to increase by USD 57.63 billion, at a CAGR of 10.14% between 2023 and 2028. The growth rate of the market depends on several factors, including growing data storage and processing needs, the growing importance of security and compliance, and the rising operational costs of managing this internally. The data center managed services refers to a type of model in which the data center is deployed, managed, and monitored by a third party. These services are designed to help organizations optimize the performance, reliability, security, and efficiency of their environments. Network management, infrastructure management, and storage management are some of the common services included in these services.
The market growth and forecasting report includes key player's detailed analyses of the competitive landscape of the market and information about 20 market companies, including Accenture Plc, Atos SE, Capgemini Service SAS, Cisco Systems Inc., Cognizant Technology Solutions Corp., Dell Technologies Inc., DXC Technology Co., Fujitsu Ltd., HCL Technologies Ltd., Hewlett Packard Enterprise Co., Huawei Technologies Co. Ltd., Infosys Ltd., International Business Machines Corp., Lumen Technologies Inc., Microsoft Corp., NTT DATA Corp., Tata Consultancy Services Ltd., Telefonaktiebolaget LM Ericsson, Unisys Corp., and Verizon Communications Inc. . Additionally, Accenture Plc provides comprehensive services, delivering stability, optimization, and efficient management of IT operations. These services seamlessly integrate infrastructure, figure, and applications, ensuring the robust support of a resilient digital enterprise.
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Growing data storage and processing needs are notably driving the market. The growing storage and processing needs of various organizations demand reliable and scalable solutions for storage and processing infrastructure, which raises the demand for these services. Factors such as digital transformation, an increase in figure generation, and the emergence of analytics are some of the major factors that are resulting in the growing data storage and processing needs. Organizations across various industries are undergoing digital transformation initiatives to stay competitive in the digital economy.
Moreover, big data analytics play a major role in deriving insights into market conditions, making decisions, and gaining a competitive edge. Healthcare, retail, manufacturing, and transportation sectors are heavily relying on analytics, which is increasing the need for storing and processing large datasets from diverse sources, including structured, semi-structured, and unstructured figures. Therefore, such factors are growing the storage and processing needs, which simultaneously will increase the market during the forecast period.
Expansion in edge computing is an emerging trend-shaping market. The expansion in edge computing is one of the major trends driving of the market. Edge computing refers to an emerging computing paradigm that refers to a range of networks and devices that bring computation and storage closer or near the user. Edge computing is increasingly being adopted by telecommunications, healthcare, transport and logistics, and other industries. As such industries increasingly deploy edge computing infrastructure closer to the point of generation, there is a growing demand for edge centers to support these distributed computing environments.
However, edge computing brings data processing and analysis closer to the source of data generation, minimizing the distance needed to travel and reducing latency. It also enhances reliability and resilience by distributing computing resources across multiple edge nodes and ensuring the continuity of operations. Moreover, edge computing is cost-effective, which increases the adoption of edge computing in retail, healthcare, transport and logistics, and other industries for enhancing operations. Therefore, such factors will drive the market during the forecast period.
Complexities in the integration of data center-managed services are a significant challenge hindering market development. The integration of these services undergoes certain challenges with the legacy systems and infrastructure, heterogeneous IT (information technology) environments, requirements for customization, migration and synchronization, and others. The usage of outdated hardware, software, and protocols creates compatibility challenges with modern technologies or standards. Integrating legacy systems with new managed services requires custom development or middleware solutions to facilitate communication and data exchange.
Further, Different organizations may have unique business processes, workflows, and requirements that require customization of managed services. Customizing managed services to meet specific requirements of the organization requirements can introduce complexity into service delivery and management. Each customization may require additional development, testing, and validation efforts, increasing the overall complexity of the managed environment. Therefore, such complexities in the integration of these services will hinder the market during the forecast period.
The market share by the retail segment will be significant during the forecast period. The retail sector refers to the sale of goods and services to consumers for personal or household use. It encompasses a wide range of businesses, from small local shops to large multinational chains, that engage in the buying, merchandising, and selling of products directly to end-consumers.
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The retail segment was the largest and was valued at USD 15.59 billion in 2018. The retail segment is experiencing growth owing to the rise in the e-commerce and omnichannel retailing aspects. Advancements in technology, such as the integration of customer relationship management services, help retailers manage customer interactions, track customer preferences, and personalize marketing campaigns. Moreover, the increase in consumer disposable income and changes in consumer preferences drive the retail segment. These services in the retail segment provide efficient supply chain integration solutions and inventory management, enhance customer experiences, and play a vital role in the demand of the retail segment. Therefore, such factors will drive the growth of the retail segment and the market during the forecast period.
The cloud segment holds a significant role in the market. Cloud computing offers organizations scalable, flexible, and cost-effective solutions to manage the information technologies in the infrastructure and operations of these services. Cloud deployment allows organizations to scale their IT resources based on the requirements. Cloud infrastructure in the managed service assists in delivering scalable solutions that can accommodate fluctuating workloads, seasonal spikes, and growing requirements without the need for upfront investments in hardware or infrastructure upgrades. Deployment of cloud assists in managing service portfolio, including infrastructure management, application hosting, data analytics, cybersecurity, and disaster recovery in this service. Therefore, such factors will drive the cloud segment in the market during the forecast period.
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North America is estimated to contribute 32% to the growth of the global market during the forecast period. Technavio's analysts have provided extensive insight into the market forecast, detailing the regional market trends and drivers influencing the market's trajectory throughout the forecast period. The increasing demand for data centers and servers is one of the major reasons for the growing demand for these services in this region. The need for the centers and servers is increasing because of higher investments by hyperscale cloud providers. The rising demand for data centers in the region can be attributed to the exponential growth in traffic from enterprises and individual consumers. Industries across the world, including North America, are implementing automation technologies to reduce cycle time, increase operational efficiency, and enhance product quality by minimizing manufacturing errors.
Moreover, the regulatory environment in North America, particularly in the US, plays a significant role in driving the market in the region. Compliance with data protection regulations, privacy laws, industry standards, and security frameworks is a priority for organizations operating in regulated industries, influencing their choice of managed service providers and solutions. Therefore, factors such as robust growth in the IT infrastructure, the increase in investments, and technological innovations are driving the growth of the market in the region during the forecast period.
The market forecasting report includes the adoption lifecycle of the market research and growth, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market growth and trends strategies.
Global Market Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Atos SE - The company offers data center managed services which provides a secure, scalable, and agile multi cloud platform capable of managing even the heaviest workloads.
Market analysis and report of qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The market research report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2018 to 2028.
The market is undergoing significant transformations, as indicated by the AFCOM State of this industry study. This evolution is particularly evident across sectors such as Healthcare, Pharmaceuticals, Education, and Enterprises, where reliance on data management is crucial. With the emergence of the Metaverse, the demand for robust services is escalating, emphasizing the need for enhanced security against cyber threats and prevention of data leakage through advanced measures like replication and cyber hardening. Ensuring business continuity and maintaining data availability are paramount, driving the DCaaS industry. Major players like Rackspace Technology and Google Cloud are at the forefront, offering tailored solutions to diverse sectors, including the ever-expanding Retail Industry and booming E-commerce platforms.
Data Center Managed Services Market Scope |
|
Report Coverage |
Details |
Page number |
175 |
Base year |
2023 |
Historic period |
2018-2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 10.14% |
Market growth 2024-2028 |
USD 57.63 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
9.64 |
Regional analysis |
North America, Europe, APAC, South America, and Middle East and Africa |
Performing market contribution |
North America at 32% |
Key countries |
US, China, Japan, Germany, and UK |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Accenture Plc, Atos SE, Capgemini Service SAS, Cisco Systems Inc., Cognizant Technology Solutions Corp., Dell Technologies Inc., DXC Technology Co., Fujitsu Ltd., HCL Technologies Ltd., Hewlett Packard Enterprise Co., Huawei Technologies Co. Ltd., Infosys Ltd., International Business Machines Corp., Lumen Technologies Inc., Microsoft Corp., NTT DATA Corp., Tata Consultancy Services Ltd., Telefonaktiebolaget LM Ericsson, Unisys Corp., and Verizon Communications Inc. |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for the forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by End-user
7 Market Segmentation by Deployment
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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