Value Added Managed Services to Drive the Overall Growth of the Market in Asia/Pacific excluding Japan

IDC: Value added managed services (VAMS) are expected to drive overall growth and unveil opportunities for vendors. VAMS, such as managed converged networks and hosted application services, are expected to grow by 18.5% in 2006 reaching US$6.4 billion. The overall enterprise managed services market is growing at a CAGR of 16.3% with an estimated value of US$17.8 billion in 2006.

Asian enterprises are faced with a twin problem of lowering cost of running an IT infrastructure and keeping abreast with ever changing technology. A well crafted managed services strategy and proper due diligence in selecting a managed service provider can go a long way in resolving these problems.

• Emerging managed services such as managed security, managed converged networks and managed mobile solutions have gained most traction. Enterprises in Australia, Korea and Singapore are usually early adopters of such emerging services and their behavior usually predicts the future trend in the region.

• PRC, Malaysia, India and Thailand are expected to lead growth in 2006. These emerging markets will experience high growth rates in managed networks as enterprises in these countries slowly warm to the idea of engaging an external third party to manage their networks. Moreover, these countries are turning to managed services to alleviate the growing pains brought about by increasingly complex networks as a result of the infrastructure build up over the past years.

• Managed network services will continue to be the largest VAMS engagement in 2006. IDC expects growth in 2006 to be close to 18% reaching US$2.7 billion. Web hosting, managed application performance and hosted application management will follow with value worth US$870 million, US$565 million and US$485 million respectively.

Asia/Pacific (Excluding Japan) Managed Services Market by Country Forecast, 2006 Source: IDC, 2006

Source: IDC, 2006

Asia/Pacific (Excluding Japan) Enterprise Managed Services 2006-2010 Forecast Publ 20060726