In terms of managed services uptake in the Asia/Pacific region, excluding Japan, Australia and New Zealand is the most mature sector, according to Frost & Sullivan. At the same time, many of the large and medium-sized organisations are looking at how they can optimise their IT investments and become more effective in utilising IT with the help of managed and hosted services.
The analysis from Frost & Sullivan found that the market, which covered 13 Asia/Pacific countries excluding Japan, was worth some $US6.47 billion in 2007, and is expected to grow at a CAGR of 16.6 per cent (2007-2010) to reach a market size of $US10.25 billion by the end of 2010.
The most commonly contracted outsourced services were managed and hosted infrastructure/network (WAN, data centre, web hosting), managed/hosted applications (software applications), managed/hosted communications, and managed/hosted security.
The increasing maturity of such services has improved cost visibility and granularity, making managed and hosted offerings a more compelling proposition to both large enterprises and small and medium businesses (SMBs). As the market reaches a new dimension of increased price pressures and decreased service differentiation, further compounded by the relatively weaker credit outlook, the need to demonstrate cost optimisation and adopt a business value-driven sales approach becomes necessary.
Frost & Sullivan industry manager, Jay Tan, said: "While Australia's large enterprises and government sector have been at the forefront in utilising outsourcing and managed services, the SMB segment is maturing in terms of ICT usage and will represent very attractive targets for telecom operators, especially in hosted services.
"The large enterprise market tends to be dominated by several global/regional system integrators and telecom operators will do well to establish partnerships with them to get greater access to this segment and focus on discrete pieces such as managed communications and WAN services to distinguish their capabilities. ANZ customers tend to value best-of-breed services. This is also the market that is expected to first see good traction with SaaS and utility computing models".
To-date, multinational companies and large enterprises, especially those in developed markets, have led in the outsourcing of specific IT services or even management of the entire IT infrastructure.
Small and medium companies have been slow to utilise these services on a major scale.
Some of the more mature markets in terms of technology adoption and managed services uptake are Australia, New Zealand, South Korea, Singapore, Hong Kong, and increasingly, India. Elsewhere in the region, managed and hosted services have yet to take off in a big way, although countries such as Malaysia, Indonesia, and Thailand offer good growth potential due to government-driven initiatives.
Len Rust is publisher of The Rust Report