Recently, analyst house Gartner, Inc. released their 2019 Magic Quadrant for Public Cloud Infrastructure Professional and Managed Services, Worldwide. Gartner defines public cloud infrastructure-as-a-service (IaaS) as a cloud environment that “delivers compute, storage and network resources in a self-service, highly automated fashion.” They also define public cloud infrastructure managed service providers (MSPs) as “a provider that offers both professional and managed services related to infrastructure and platform operations for one or more hyperscale integrated IaaS+PaaS providers.”
The Magic Quadrant lists 19 different MSP vendors and highlights their offerings, their strong suits, and their weaknesses. Gartner then measures the vendor on both the completeness of their vision and their ability to execute. From these measurements, the vendors are placed into one of four categories: Leaders, Challengers, Visionaries, and Niche Players. The 19 vendors that Gartner analyzed this year are: 2nd Watch, Accenture, Atos, Bespin Global, Capgemini, Cloudreach, Cognizant, Deloitte, DXC Technologies, HCL Technologies, Infosys, Logicworks, Nordcloud, Rackspace, Samsung SDS, Smartronix, Tata Consultancy Services, Unisys, and Wipro.
Vendors: who’s gone, who’s new, and who’s moved?
For this year, three vendors were added: Atos, Samsung SDS, and Unisys. All three were placed in the Niche Players category. Four vendors were dropped from last year’s MSP Magic Quadrant: AllCloud, Cloudnexa, Onica, and REAN Cloud.
The Leaders quadrant was more crowded this year, with 6 entrants instead of 2018’s 3. Accenture and Rackspace maintained their Leader status while Cloudreach was moved to the Challengers category, with Gartner citing their expansion and mixed-to-positive response from its userbase as reasons for the change. Deloitte, Infosys, Smartronix, and Wipro all moved into the Leaders circle because of their wide availability and support for multiple cloud environments.
Only 2 vendors remained in the Challengers quadrant from last year: 2nd Watch and LogicWorks. New to the category this year are Bespin Cloud (Gartner praised their growth and in-house CMP development but noted their market presence is limited to South Korea and China); Cloudreach, (as stated above, recent expansions and customer responses influenced their move) and Cognizant (who showed significant improvement in quality of service delivery but still mostly caters to large enterprises).
In the Visionaries quadrant, no new vendors were added and 3 were moved elsewhere, leaving only 3 behind: Capgemini, HCL Technologies, and Tata Consultancy Services. Tata’s ranking for both completeness of vision and ability to execute improved, with Gartner describing their cloud applications as broader than most other offerings. Capgemini and HCL’s ratings dipped slightly but overall the Visionaries quadrant stayed relatively consistent for the remaining vendors.
The Niche Players quadrant saw the most new faces and removals this year, though the total number of vendors remained at 5. The sole returning vendor from last year, Nordcloud, which Gartner cited as having grown over the past year but still needing time to fully mature. DXC Technology landed here from the Challengers quadrant, as Gartner pointed out it was undergoing a major transitional period that has lowered its customer satisfaction. As previously mentioned, the three added vendors this year – Atos, Samsung SDS, and Unisys – all landed in this quadrant, all of which are relatively new to the MSP sector and need time to develop.
Everything-as-a-service is more popular than ever
Hybrid and multicloud deployments have now taken over the IT world as more companies introduce them into their infrastructures. As a result, vendors that offer “everything-as-a-service” – or a wide variety of applications built for the cloud – are gaining more traction. Gartner said that “A managed service-only offering has limited value in the long term — except in niche markets.” It seems that more customers want to forgo building their own applications in favor of ready-built cloud services that provide those functionalities out of the box.
Gartner predicts a mergers and acquisitions wave
Gartner noted that the MSP market is maturing quickly, with several early entrants and forerunners not included in this Magic Quadrant. Larger providers have entered the MSP space that have eclipsed smaller vendors with their greater resources. This highlights a potential development for MSPs that Gartner predicts will happen sometime soon: a wave of mergers and acquisitions. Now that bigger names have entered the field, it’s only naturally that they will want to absolve smaller companies into their fold. Gartner expressed their belief that “MSPs with less than $100 million in total revenue (for the company as a whole) will be particularly attractive acquisition targets.” We agree with Gartner’s prediction on this front, and expect at least one major acquisition in the MSP field by the end of 2020.
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