How will cloud computing impact IT managed service providers?

The role of MSPs (and Cloud Service Providers/CSPs) is becoming more prominent with each passing year. The likelihood of legislation being written which impacts MSPs is high. In fact, such laws have already been enacted in China, requiring the assistance of technology companies in assisting the Chinese government with terror-related investigations. Look for this type of law in other jurisdictions around the world. Increased cloud-based adoptions from the enterprises and heavy competition in today's world add to the pressure of having the best IT infrastructure by enterprises. Having a good IT infrastructure without a properly managed service diminishes the profits it has on offer. Moreover, the enterprise loses on its core competency. Managing the physical as well as the software infrastructure inside the data centers is instead offered to the more skilled Managed Services vendors in the market. Traditional, as well as cloud-based hosting is managed by the vendors.

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If anything, the increased use of cloud computing will see MSP's see considerable growth due to the fact that many companies that once performed their hosting/compute internally rather than outsourcing either the physical housing of the equipment to a third party data center or to a managed hosting provider for unmanaged or managed dedicated servers will now see the cost benefits of utilising elastic compute resources on an on demand/as needed basis. As a result of outsourcing into a cloud computing model, you will see these companies also take the plunge and outsource the management of the cloud instances to the MSP as well as part of whole of business agreements.

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Hi, If you intend to say IT managed service providers who offer dedicated/shared hosting then the answer is 'yes', their business may be on the toss. E.g. if you are aware of Rackspace which is one of the renowned managed service providers to survive they have tied up with AWS and other cloud computing providers as a partner. Existing IT managed service provider need to think collaboration or make strategic partner to help migration activities.

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