The growth of MSPs in Europe: Trends and Challenges

With remote working reaching new heights globally, and the rise of cloud diversification, IT Managed Service Providers are in high demand.

The role of MSPs in Europe has increased significantly, as organizations seek to minimize capital expenditure, and make the very most of their IT budgets. This is creating a thriving market for MSPs, while opening a whole new world of innovation, experience assurance, added security and business insights for organizations across Europe.

Market overview

A report stated that, “With growth rates forecast to continue at over 8.5% per year, the IT managed services sector remains one of the strongest growth rates in IT & telecoms.”

The European managed services market was valued at USD 88.57 billion in 2020 and is projected to be worth USD 196.61 billion by 2026.

The UK has the most managed services providers, followed by the Netherlands, Germany and France. The markets being serviced by the major players tend to be the same in each country: Banking/Finance, Manufacturing, Healthcare, Education, Retail and the public sector.

Eastern Europe is also experiencing growth within cloud and hosting technology trends, and server virtualization technology is gaining traction over dedicated physical servers in the traditional hosting model.

Key market trends and challenges

Business owners and leaders are now increasingly aware that they need to call on external expertise to create an efficient business in keeping with new and emerging technologies.

With such rapid growth within the industry in Europe, MSPs will be focusing on some key elements that can make them stand out amongst competitors, while creating new opportunities to offer added value to their customers.

High performance and scalability.

A highly scalable, software-defined IT infrastructure is at the core of the MSP industry. The creation and implementation of efficient business systems is what MSPs will be looking to deliver. This specialization could, however, be costly and time-consuming.

User experience and satisfaction.

Through automation, MSPs are moving towards removing repetitive and redundant tasks and workloads. This shifts the focus to customer and employee satisfaction. The challenge is to produce new ways to add value to the service offerings presented to clients.

Security.

An MSPs top priority is protecting business security. Identifying risk factors, building solutions to safeguard their customers, and monitoring are all part of the focus. Another challenge is that no matter what market they are in, MSPs Will need to stay up to date on the cybersecurity landscape in Europe.

Monitoring productivity.

With rapidly shifting customer needs, MSPs are charged with the task of fulfilling their customers’ requirement for better performance, increased uptime and result-based outcomes. It is vital for MSPs to provide the ability to measure results, and this means teaming up with trusted performance management solutions providers.

Slashing operating costs.

MSPs can remove the need for costly physical, on-premises equipment, and invest in their own infrastructure. With fully managed, tailored virtual cloud solutions, they can save money and help customers grow their business. The challenge is to maintain customer retention by remaining competitive and reiterating value addition to their customers.

This performance visibility allows controlled access in three focus areas: voice quality, service ability and device status. All this, through customer facing dashboards that provide end-to-end cohesiveness.