2018 IT Spending Has Good News for Managed Services

It's that time of year again when we get the annual IT spending forecasts from Gartner. As predicted from their 2017 forecasting, 2018 is looking very good and should bode very well for providers of managed services and cloud computing.

Here are the numbers, according to Gartner's annual IT spending survey.

Global IT Spending

Gartner is projecting that global IT spending will surpass $3.6 trillion in 2018, representing an increase of 4.5% from 2017. The tax cuts, lower regulation, and increases in cyber threats can all take credit for this increase. The forecast for 2019 global IT spending is $3.7 trillion; an increase of 2.7% from 2018.

IT Services

The category which impacts MSPs and cloud providers the most has very good news this year. Gartner predicts that IT services spending will reach $985 billing in 2018, a 5.5% increase from 2017. While there are many reasons for this increase, I would speculate that increase security threats are a large part of why organizations are outsourcing general IT management to MSPs, but specifically their IT security as well.

But, what is really exciting is what may happen in 2019.

Gartner projects that in 2019 IT services spending will surpass $1 trillion. While this is not all managed services, I would guess that at least a quarter of this amount could be attributable to managed services and cloud spending.

New MSPs Entering Market

As with previous periods, we have been witnessing a fairly sustained and reasonable growth in the managed services community for at least 20 years now. And, while some continue to claim skepticism about the longevity of MSPs as a business model (generally levied by analysts trying to sell the next new trend), there are a large number of new entrants into the MSP profession. These are startups focusing specifically on managed services. With nearly a trillion dollars up for grabs, it is easy to understand why so many entrepreneurs still believe in the appeal of managed services.

 

 

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