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The managed multiprotocol label switching (MPLS) market size is estimated to grow at a CAGR of 6.41% between 2022 and 2027. The market size is forecast to increase by USD 7,239.8 million. The growth of the market depends on several factors, including the increasing demand for secure and reliable connectivity, the expansion of managed SD-WAN services, and the expansion of managed SD-WAN services. Managed multiprotocol label switching is a service offered by network service providers, which controls the planning, execution, and continuous maintenance of MPLS networks for companies. It includes prioritizing traffic, secure and dependable connectivity for organizations, and effective data packet routing through a private network.
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The increasing demand for secure and reliable connectivity is driving the growth. The growing reliance of companies on managed MPLS services has been one of the major drivers for the market. These services provide dependable connectivity options that link different locations inside an organization, thus enabling smooth data transfer and communication. In order for businesses to grow globally and benefit from the essential applications in their business, they need a solid network infrastructure that enables them to cope with interconnection system needs.
However, for businesses seeking efficient and secure connectivity solutions, managed services are the preferred choice due to their ability to fulfill the necessary bandwidth, Quality of Service (QoS) assurance, and prioritization capabilities to support these vital business applications. Hence, the increasing demand for secure and reliable connectivity is an important driver that is expected to drive the growth of the market in focus during the forecast period.
The expansion of managed SD-WAN services is a primary trend in the market. In order to upgrade the performance, cost-effectiveness, and application prioritization of their wide-area networks (WANs), organizations are increasingly turning to integrated SD-WAN solutions, which are becoming popular in the global market. To respond to this demand, fully SDWAN solutions combining the benefit of MPLS with its speed and elasticity as a Software Defined Networking solution are being provided by service providers that manage an MPLS network.
However, these integrated solutions provide businesses with the ability to reduce costs, enhance network performance, and effective management of applications in a number of locations. Businesses may dynamically assign bandwidth, give priority to key applications, and integrate various network connections seamlessly by utilizing SD-WAN technologies. This indicates that market acceptance of the importance of transformational WAN solutions, which can grow in line with evolving requirements for today's business organizations such as Google and Amazon, is beginning to emerge. Hence, the expansion of managed SD-WAN services is a significant trend, which is expected to drive the growth of the market in focus during the forecast period.
Complex network management is a major challenge faced by the market. The management and maintenance of a global network is an enormous challenge in the world market for managed MPLS. The initial challenge lies in the extensive size and geographic dispersion of the network, due to which the network configuration becomes complicated. In order to coordinate settings across a number of sites and ensure seamless connectivity, it takes expertise and meticulous planning.
However, troubleshooting becomes challenging when issues appear throughout the network. In order to address the problems, identify their root causes, and make efficient solutions available, it will take skilled network engineers and significant resources. Moreover, network management is becoming more complex as a result of the need for constant monitoring, performance optimization, and security controls to be carried out throughout the worldwide MPLS infrastructure. Thus, operating and maintaining an MPLS network is a challenging task in the market because of these complications, which, in turn, can impede the growth of the market in focus during the forecast period.
The market share growth by the IT and Telecommunication segment will be significant during the forecast period. The IT and telecommunication industry accounted for a significant market share as an end-user in the market. This sector depends heavily on managed MPLS networks in order to ensure the security, reliability, and efficient transmission of data. Managed MPLS systems have advantages like better network performance, increased scalability, and efficient traffic prioritization.
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The IT and Telecommunication segments showed a gradual increase in the market share of USD 5,737.05 million in 2017 and continued to grow by 2021. For instance, Juniper focuses on delivering a high-performance networking solution, including managed MPLS services, that provides seamless and optimal network performance to users of IT and telecommunications throughout the world. Owing to the advantages, the adoption of managed MPLS in the IT and telecommunications sector is expected to increase over the forecast period, thus driving the growth of the market in focus.
Level 2 VPN emerged as a leading service in the globally market in 2022. It is aimed at providing innovative solutions that take account of the changing requirements of enterprises, i.e. enhanced security features, more seamless connectivity, and flexible deployment options. Moreover, operators are focused on increasing their global footprint in order to serve a large number of customers efficiently and gain an advantage over the worldwide market. Owing to all these factors, the level 2 VPN service segment is expected to witness significant adoption and, hence, drive the growth of the market in focus during the forecast period.
The market is a segment within the broader landscape of managed network services, focusing on optimizing IT infrastructure and enterprise connectivity through efficient network management solutions. MPLS technology enables organizations to enhance network security while facilitating seamless communication across a wide area network (WAN).
With the rise of cloud networking and increased reliance on digital infrastructure, businesses prioritize network optimization and performance management to ensure uninterrupted business communication and operations. Managed MPLS services offer comprehensive solutions, including managed router services and MPLS VPN, to streamline network traffic and ensure secure virtual private network (VPN) connections.
As organizations seek to enhance their network monitoring capabilities and implement robust traffic engineering strategies, the demand for managed MPLS services continues to grow. Market stakeholders closely analyze market growth analysis, conduct market research, and develop market growth forecasts to anticipate industry trends and drive effective market forecasting efforts.
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North America is estimated to contribute 33% to the growth of the global market growth and forecasting report during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. In North America, the demand for secure and dependable network connectivity, efficient data transmission, and the rising usage of cloud services are contributing to the continuous growth of the regional market in North America. The leading companies in the regional market and those businesses offer end-to-end managed services, ensuring seamless connectivity, improved network performance, and increased security by utilizing their enormous network infrastructure and experience. They also make a positive shift towards the market focus in 2021 to deal with ever-changing business needs. As businesses increasingly transition to on-the-spot operation, their need for managed MPLS services has increased.
The industry report includes the adoption lifecycle of the market, 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 growth 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.
AT and T Inc. - The company offers MPLS such as ONE unifies, VPN Business solutions, Networking services, Wireless services, Voice, and collaboration.
BT Group Plc - The company offers managed MPLS such as SD-WAN solutions, Hybrid connectivity, LAN solutions, and Secure Access Service Edge SASE solutions.
Cisco Systems Inc. - The company offers managed MPLS such as voice, video, business-critical data services, Internet access, and Multiprotocol label switching.
The market research and growth report also includes detailed analyses of the competitive landscape of the market and information about 15 market companies, including:
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 report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027.
Managed Multiprotocol Label Switching (MPLS) Market Scope |
|
Report Coverage |
Details |
Page number |
164 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 6.41% |
Market growth 2023-2027 |
USD 7,239.8 million |
Market structure |
Fragmented |
YoY growth 2022-2023(%) |
6.01 |
Regional analysis |
North America, Europe, APAC, Middle East and Africa, and South America |
Performing market contribution |
North America at 33% |
Key countries |
US, China, Japan, UK, and Germany |
Competitive landscape |
Leading companies, Market Positioning of companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
AT and T Inc., Bharat Sanchar Nigam Ltd., Bharti Airtel Ltd., BT Group Plc, Cisco Systems Inc., ERNET India, Forcepoint LLC, International Business Machines Corp., Juniper Networks Inc., Lumen Technologies Inc., NTT Communications Corp., Orange SA, Palo Alto Networks Inc., Reliance Industries Ltd., Syringa Networks LLC, T Mobile US Inc., Telefonaktiebolaget LM Ericsson, Verizon Communications Inc., Versa Networks Inc., and Vodafone Group Plc |
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, and 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. |
We can help! Our analysts can customize this market research report to meet your requirements.
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 Service
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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