How Many MSPs Are There?

Posted 6.11.2019

I get asked this question a lot. Perhaps more interestingly, people want to know how many MSPs are practicing today to determine whether entering the managed services profession is worthwhile.

While it may be obvious for me to say becoming an MSP is worthwhile, I would like to address the general market conditions we face and hopefully inform those who are considering managed services as a professional career.

Is it too late to become an MSP?

No. A better question would be, is it too late to salvage your old business model? I see far too many companies who question the future of managed services rather than matter their current business model and motives around why they want to leave it.

Mainly if you are doing a lot of break/fix work, you must ask yourself whether there is a future in that line of business and whether customers are knocking on your door asking for reactive IT management. Chances are, customers are not asking you for these services, and if they are, would you want to take them on as clients?

Is the MSP Marketplace Too Crowded?

There are a lot of “MSPs” practicing today. During the mid-2000s, it was estimated that there were approximately 150,000 MSPs globally. After 2009, while we lost some MSP companies, we gained more businesses through cloud startups, mostly offsetting any attrition we saw.

As with any profession, managed services has several layers of competitiveness. You have general practitioners and regional MSPs who do great work but are quite plentiful and may contribute to a perception of saturation in a particular geographical market.

The more vertical or specialized the MSP, the less competition they tend to have. So, if you are a new entrant to managed services, you may find that competition feels strong, it is more challenging to differentiate yourself from other MSPs, and finding a foothold in the market is tougher than you thought it would be.

However, as you progress up the maturity ladder, you will find that competition thins out quickly and significantly; customers are plentiful and seeking out qualified MSPs. This is especially true as you enter more regulated markets where transparency requests are more frequently made and MSP certifications and audits are less commonly found.

Is it too late to become an MSP? The question is asking whether they missed the opportunity to become an MSP. I don’t think so. The real question that must be addressed is whether you can remain in whatever business model you’re in today.

Tags : break-fix,MSPs

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