Demand for managed services will see data center revenue rise

Demand for managed services will see data center revenue rise

Growing demand for managed services in the high tech and telecommunication sector will see the market reach new financial levels by 2018, according to a recently released report.

Research conducted by MarketsandMarkets has shown that the industry will generate annual revenue of over $256 billion within the next five years, with a high demand for data centers, access control and managed security contributing to continual growth across the globe. According to the report, North America remains the largest market in terms of revenue contribution, although there is likely to be a demonstrated uptake in managed services and data center security in regions such as Europe and Asia Pacific.

The need for third-party supply of these services comes at a time when the concept of risk sharing is gaining greater prominence. According to the authors of the report, implementing managed services into business operations can reduce internal IT costs by 30 to 40 percent, with the study showing that nearly operational efficiency can be increased by up to 60 percent.

Removing the need for an in-house infrastructure ensures that an organization can concentrate more on its core business strategy, with the report noting that managed services allows for the reduction in capital expenditure in terms of internal IT requirements. At the same time, managed servicing provides companies with a opportunity to take advantage of the latest advances in data center security, thereby ensuring that the data center itself becomes an integral part of the equation.

Ensuring security
This naturally means that verification of user identity is key. Writing on Tech Target, Clive Longbottom noted that data security strategy was paramount, with multi-level identification going beyond what he referred to as "the normal challenge-and-response username/password pair." According to Longbottom, this is likely to see an increase in the use of biometrics and will ensure that assets are only available to the right people in the right place.

This puts the onus back on the data center itself, especially when considering that managed services is now a common option for many business decision makers. It also means that an organization has to identify where any potential breaches may occur, with information becoming an increasingly valuable commodity beyond the walls of a physical location.

Finally, the expansion in the sector will likely be driven by the variety of industry verticals that recognize the benefits of outsourcing their IT and data storage requirements. With technology unlikely to stand still, there is reason to believe that the optimistic forecasts of the report will prevail for some time to come. 

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