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Managed services more than a GFC-induced fad

Managed services more than a GFC-induced fad

The managed services boom, often attributed to cost savings and capital expenditure cuts, shows no signs of slowing as confidence returns to the economy.

The managed services boom, often attributed to cost savings and capital expenditure cuts, shows no signs of slowing as confidence returns to the economy.

In a recent report, Gartner cited 19 per cent average growth across the industry’s managed security services providers' client base. The firm rated the overall market as positive and highlighted standout performances from Seccom Global and Verizon Business.

Security managed services provider, earthwave, has seen huge growth of between 50-80 per cent a year for the past four years, founder and CEO, Carlo Minassian, claimed.

“Customers are taking up managed services for cost predictability and access to experts – the global financial crisis has driven a lot of us,” he said. “However, this is where everything is going – if anything, it will speed up going forward. Organisations are moving with the times and building software and solutions around managed services.

“Like the PC industry, those organisations that don’t observe trends will find themselves in trouble – those left in the PC business have adapted to the much lower margins than what that industry used to enjoy.”

The success of managed security services providers also extends to other areas of the managed services space, according to industry players. ASX-listed ComputerCorp expects the managed services market to escalate as organisations find new issues that these solutions can address. The company experienced 35 per cent growth in the last year, much of which could be attributed to managed services, services and sales director, Ray Pater, said.

“We’re in a split-stream economy as it is, and there are two main reasons that organisations are taking up managed services: Cost is one, but taking the complexity out of business is a big issue,” Pater said. “In a weak economy, organisations look to take on managed services to save costs. Organisations growing in that kind of climate are going to be cautious, and don’t want to take on too much, so they adopt a managed services solution.


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