Managed application services is a business model where an enterprise outsources the hosting and management of its business-critical applications to a third-party service provider. The managed application services provider takes responsibility for various tasks associated with applications, such as maintenance, support, upgrades, security, and disaster recovery. They assist organizations in improving operational efficiency by streamlining application management and reducing costs. Various end-use industries such as BFSI, IT and telecommunication, government, healthcare and life sciences, retail and e-commerce, and others rely on managed application services for optimizing application performance, enhancing security and compliance, and maximizing productivity.
The global managed application services market is estimated to be valued at US$ 5.41 bn in 2023 and is expected to exhibit a CAGR of 21% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
The growing demand for maximizing business productivity is a key driver fueling the growth of the managed application services market. Enterprises are increasingly adopting managed application services to focus internal resources on core business functions while outsourcing non-critical application management tasks. This enables organizations to improve business agility and optimize operational efficiency. In addition, managed application services help companies reduce costs associated with in-house application management such as license fees, maintenance costs, infrastructure expenses, IT staffing costs, and training expenses. The cost advantages offered have encouraged SMEs as well as large enterprises to leverage managed application services. Furthermore, the growing need to minimize risks of application downtime and ensure compliance is also stimulating the demand for managed application services globally.
Managed Application Services Market is segmented into applications such as Telecom, Finance, Government, Healthcare, Travel and logistics, Media and entertainment and others. Among these segments, Telecom sector dominated the market and accounted for more than 25% share in 2022. It is dominating the market as managed application services helps telecom industry players to reduce operational and maintenance costs thereby increasing profit margins.
Political: Managed applications services market witnesses political stability as governments across the globe are focusing on digitization which is positively impacting the adoption of managed services.
Economic: Strong economic growth in emerging markets and increasing global IT spending is fueling the demand for managed application services from industries to reduce capital and operational expenditures.
Social: Rising popularity of digital technologies across industries and growing acceptance of cloud based services among organizations are some key social factors propelling the managed application services market growth.
Technological: Advancements in technologies such as cloud, artificial intelligence and IoT are allowing managed service providers to offer enhanced automation, analytics capabilities and improved customer experiences to enterprises thereby augmenting the market.
The Global Managed Application Services Market Growth is expected to witness high at a CAGR of 21% during the forecast period of 2023 to 2030.
North America dominated the market and accounted for over 30% share in 2023 due to rapid automation and digitalization among industries in the region.
Key players operating in the Managed Application Services Market are Fujitsu Limited, Mindtree Limited, IBM Corporation, Wipro Limited, Unisys Corporation, CenturyLink Inc., Virtustream Inc. and HCL Technologies Limited. These players are focusing on partnerships, collaborations and technology innovations to enhance their service capabilities and gain higher market share. Key players operating in the market are Fujitsu Limited, Mindtree Limited, IBM Corporation, Wipro Limited, Unisys Corporation, CenturyLink Inc., Virtustream Inc. and HCL Technologies Limited. The APAC region is expected to witness fastest growth during the forecast period owing to rising IT spending from industries in developing countries like India and China. Key players in the market are focusing on emerging markets to tap new business opportunities by offering customized managed application solutions.
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it