The Managed Services market is one of the telecom industry’s fastest-growing segments, and is characterized by agreements between Managed Services providers and a broad range of telecom operators.

Managed Services include establishing, operating and managing the day-to-day operations of a telecom operator’s network, services and business-support systems. They also include a provider taking responsibility for providing the required network capacity to an operator, as well as the hosting of content, applications and enablers.

Managed Services providers are both telecom-equipment vendors that exploit their expertise to offer additional services to customers, and non-traditional telecom vendors. Telecom-equipment vendors are better positioned to take on new roles in the value chain as they can exploit their existing competences.

Operators that have utilized Managed Services have been driven by several factors. These include: the ability to improve their financial results by outsourcing functions to a partner that can provide higher efficiency and economies of scale; the possibility to reduce the need to build network-related competence; and the chance to focus more of their efforts on revenue-generating activities, such as customer acquisition and retention.

The growing number of Managed Services agreements is creating a virtual circle resulting in increasing Managed Services provider competence, leading to even greater efficiency gains and economies of scale. This, in turn, will make Managed Services even more attractive to all operators, and most will enter into some kind of Managed Services agreement, in part or in full, to stay competitive in the market.