Managed services had a wild ride in 2018 and 2019 is going to be even crazier. 2018 saw a lot of movement within the profession, both on the MSP side, as well as the vendor community.
Managed Service Spending On the Rise
2018 saw a noticeable increase in managed services spending. Even though there many research reports, each tracking different levels of managed services spending, the obvious takeaway is the spending is on the rise and remains strong globally.
Yes, there are stronger and weaker areas of managed services spending throughout the world. These weaker areas tend to be impacted more by technical and infrastructure limitations than anything else.
2019, although just beginning, already looks like more increases in spending, including managed services.
More Data Breaches
While 2018 wasn't unique, we did continue to see massive (and likely) preventable data breaches. Most recently, Marriott Hotels experienced a breach which compromised approximately 5 million passport numbers. There were others throughout the year, reinforcing the idea that large scale data breaches are still happening and likely will continue in 2019.
MSPs as Targets
This was new for 2018. Originating in Australia, the United States NCCIC issued a warning that MSPs could be targets of cybercriminals wanting to gain access to end-users. While using 3rd party vendors is not a new concept, the targeting of MSPs is. This is going to be a story worth following in 2019. However, the apparent implication for MSPs is to take internal security as seriously as they do for their customers.
M&A Consolidation vs. Attrition
2018 saw the usual amount of M&A discussion, typically around buyers generating buzz that it's a great time to sell your MSP practice. As we previously argued, we don't believe there is any such market consolidation taking place. Instead, natural market attrition has been taking place for at least two decades. This market attrition does NOT mean, however, that the market is shrinking. To the contrary, it is growing. Just look at the Gartner IT spending forecasts and see for yourselves.
GDPR
2018 was the year GDPR became law in the European Union. Although many non-European MSPs initially did not consider GDPR to be relevant, the law has found a way to extend its reach to the farthest reaches of the globe. Likely to face legal challenges in the future, particularly over enforcement and the private right to action, GDPR has thrown down the gauntlet of data privacy legislation.
