If I were asked (and believe me I am) to list the hot managed services zones around the world it might look something like this. Keep in mind, this list is always subject to anomalies and outliers and is my own view of the market. To be more precise, I might actually categorize the following regions in two ways: first, their existing maturity and capability to deliver managed services, and second, the region's capacity to advance and in some way control the advancement of the managed services profession in that geographic area. We might call the first characteristic the maturity level and the second future capacity.
North America - clearly this is the oldest and most developed region on the planet when it comes to managed services adoption. Starting at the large enterprise, filtering down through the mid-market and now firmly embedded in the SMB (small and medium business market) the managed services community in N/A is well established.
The N/A MSP market, however, is struggling today due to a number of factors. First, the economy has caused an abundance of small startups all trying to brand themselves as MSPs. While this is a positive attribute of the N/A market it does have the potential to create dilution, especially when so few of the MSPs starting up do not abide by "best practices". This lack of best practices adoption may be caused by the refusal of smaller MSPs to ask for help from other MSPs and learn from the more mature providers.
A second factor affecting the N/A marketplace is the general economic, tax, and regulatory pressures being placed on MSPs as businesses. The same regulatory, tax, and lack of funding pressures that drive end-users towards managed services can also have a similar negative impact on the MSPs themselves.
Western Europe - Outside of N/A Western Europe, particularly the UK, Ireland, France Germany and Benelux, have long been mature areas for managed services. Owing to their strong broadband and telephony foundation, this region has produced some very strong MSPs over the years and has a good track record of marketing and selling managed services.
Recently, countries like Ireland and the UK have been relatively hard hit by the global financial crisis and are currently trying to rebuild their businesses. Other countries, like France and Germany, seem to be doing much better than other Western European countries.
Middle East - While this region has traditionally been quiet and uninvolved, certain countries (particularly United Arab Emirates) have emerged as high growth area areas for managed services companies. Perhaps due to the oil and gas industry or maybe as a result of the quick build out of other fundamental services throughout the region, MSP businesses are even now being created or are emerging from larger (mid-market and above) system integrators and VARs who are eager to adopt a managed services line of business.
Asia/Pacific - While one of the largest regions in managed services it is perhaps the most complex and diverse. Countries like India, Pakistan, and Indonesia, have long been involved in the global managed services community primarily due to their desire to target Western MSPs and end-user businesses for offshoring services. With a modest amount of infrastructure and boasting its primary asset, experienced and inexpensive labor, these countries serve an important role in the managed services ecosystem.
In recent years some Western countries have adopted more stringent IT security and data privacy policies, driving more "onshore" or domestic outsourcing interest. These offshore havens do remain strategically viable for Western MSPs (and their clients) who want to setup and control an offshore facility themselves. Quite a few MSPs in N/A have done this in the last 3-5 years.
Countries like Australia and New Zealand, however, remain sufficiently unique for the region and represent a tremendous growth opportunity. Despite their geographic isolation and the amount of infrastructure buildout that remains (in both countries) both New Zealand and Australia are predicted to gain significant momentum in managed services adoption and revenue over the next decade.
Both countries have stable financial systems and possess MSPs willing to share ideas and collaborate in order to grow.
Africa - While encompassing a very large continent, there are only a few countries/regions in Africa that possess the potential for managed services success in the near future. South Africa has the capacity to generate a lot of demand in managed services, particularly from the larger MSPs who are dominating the region. Smaller MSPs do not represent a large percentage of the IT population and adequate infrastructure still remains a problem.
Over the next decade, however, South Africa should a vibrant managed services region.
Central/South America - Lead primarily by larger VARs, system integrators, and telephony providers, this region has been slowly developing managed services firms over the last few yeras. Mostly focused on telephony (most of the region's infrastructure is based on the telephony trade) these MSPs are rapidly adopting managed services offerings and capabilities, including some with a unique focus on offering Spanish speaking help desk and services to North America.
Political uncertainty in some of the countries and the lack of adequate IT infrastructure are the only significant barriers to this region's growth.
If you are interested in further analysis on any of these regions please feel free to contact me at charles at mspalliance.com/
