Highlights:
- Barracuda’s new global MSP report shows that IT service providers expect 44% of revenue to come from recurring managed services in 2024, up from 34% in 2023.
- Most are planning to introduce around 6 new services on average, and their most successful products are security related.
- 77% of MSPs feel under pressure to offer customers AI insight and tools.
- 92% say cloud marketplaces will be crucial for their organization.
Barracuda Networks, Inc., a trusted partner and leading provider of cloud-first security solutions, today published The Evolving Landscape of the MSP Business 2024 report, which shows how managed service providers (MSPs) around the world are embracing marketplaces and artificial intelligence (AI) to better meet customer needs, but worry about their lack of knowledge about AI and its applications.
Barracuda’s seventh annual MSP report, undertaken together with Vanson Bourne, features the findings of an international survey of 700 MSP organizations. The report is being released alongside Barracuda’s Global MSP Day, which includes virtual and live events for MSP partners in North America, Europe, and Asia Pacific.
The findings show that MSPs continue to shift from project-based customer support to a recurring services model. This year, MSPs expect just under half (44%) of their revenue to come from such recurring services, up from 34% in 2023. According to 92% of respondents, businesses are scaling back their in-house IT and relying more on MSPs, and this is likely to be a key driver for the rise in recurring services.
Customer demand is greatest for security products and services. According to the survey, the top three solutions MSPs offer and support are security operations centers (42%), security awareness training (38%), and network security (36%). MSPs expect to expand their portfolio with an average of six new services overall during 2024.
Other key findings include:
- MSPs believe that cloud marketplaces will simplify operations: 92% of respondents identified cloud marketplaces as a crucial tool for their organization. In addition, 47% of MSPs are using cloud marketplaces already, and 50% of the remaining respondents are exploring the option.
- Appetite for AI knowledge: Almost 9 in 10 of the MSPs surveyed (87%) say they need either significant or notable improvements in their knowledge and application of AI products and services. In addition, 77% of MSPs feel under pressure to offer customers AI insight and tools.
- MSPs have concerns about their own security: 98% of MSPs believe they need to improve their internal security posture.
- MSPs are realistic while being optimistic: While growth is expected in 2024, MSPs cited their top challenges as increased competition in the MSP market (48%), up from 44% in 2023; and lack of ability to help customers comply with government regulations (82%).
“Like all organizations, MSPs face continuous change,” said Patrick O’Donnell, Senior Vice President, Worldwide Sales, Barracuda. “Competition is increasing and routes to market are evolving, while emerging technologies and digital transformation are expanding the potential attack surface for cyberthreats. That’s a lot to keep on top of, and the survey shows that more than half of MSPs are looking for extra support. Good partner/vendor relationships that deliver specialist experience in the field of security and AI-integration can help MSPs address some of the challenges and thrive in the competitive landscape of 2024 and beyond.”
“In 2024, MSPs are strategic partners to their clients, helping them to address technology complexities and manage the security challenges of digital transformation,” said Richard Tubb, MSP growth consultant and MSP Day speaker. “The research shows that many MSPs are responding to shifting client needs by actively embracing new opportunities that will benefit clients as well as their own operations and business growth.”
To view the full report, visit https://www.barracudamsp.com/r...of-msp-business-2024
About Barracuda
At Barracuda we strive to make the world a safer place. We believe every business deserves access to cloud-first, enterprise-grade security solutions that are easy to buy, deploy, and use. We protect email, networks, data, and applications with innovative solutions that grow and adapt with our customers’ journey. More than 200,000 organizations worldwide trust Barracuda to protect them — in ways they may not even know they are at risk — so they can focus on taking their business to the next level. For more information, visit barracuda.com.
About MSP Day
Barracuda MSP, the MSP-dedicated division of Barracuda Networks, introduced Global MSP Day seven years ago to recognize and celebrate MSPs around the world while providing an opportunity for MSPs and vendors to collaborate, interact, and share success, best practices, and key industry insights. This event is full of opportunities for IT managed service providers — the information and shared experiences are guaranteed to increase knowledge and help businesses discover best practices to promote business growth.
This year’s event includes both virtual and in-person experiences. The virtual event highlights insight from international IT business growth expert Richard Tubb and leading voice and advocate for the IT ecosystem, The Computing Technology Industry Association (CompTIA). We’re also delighted to include Wingman MSP Marketing and Channel Program in this year’s celebration.