30% of MSPs forecast growth of over 20% by 2025
As cyber threats intensify, demand for managed services continues to grow at a rapid pace. According to Canalys, by 2025, 28% of managed service providers are expected to achieve over 20% growth. To maintain this positive trend, MSPs must evolve towards an MSP 3.0 model, as AI integration and automation are essential tools in addressing cyber risks and regulatory challenges.
This paradigm shift seeks not only to improve operational efficiency but also to ensure the sustainability and competitiveness of the sector. The main trends that will shape the future of MSPs include:
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Evolution towards MSP 3.0:
MSPs are prioritizing artificial intelligence and automation as key growth pillars over the next few years. While AI use, in collaboration with specialized professionals, will be a key feature in the future of managed services, by 2025 training and consulting in this technology will be a priority for most MSPs.
MSP 2.0 focused on recurring revenue from centralized IT services and infrastructure support. MSP 3.0 represents the next evolution ‒ where AI-driven automation, cybersecurity integration, and regulatory alignment become core to service delivery, enabling MSPs to offer advanced, proactive, and compliant solutions.
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Regulatory and compliance challenges:
Rising cyber risks are driving new regulations that could represent an obstacle for MSPs, such as the NIS2 directive that aims to create a common cybersecurity standard across EU member states. Preparing and adapting to these changes will be key to their sustainability and continuity as managed service providers.
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Growth in managed IT services and cybersecurity:
Revenues from managed services are forecast to rise substantially, driven by increasing demand for advanced cyber threat protection and the ongoing evolution of the IT landscape. According to Canalys, the growth is reaching $595 billion globally. These projections highlight the rising adoption of managed services and the growing importance of cybersecurity in the global market.
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Mergers and acquisitions:
Faced with the surge in cyber risks, MSPs will need to opt for mergers and acquisitions to expand their service offerings and improve their competitiveness. By integrating advanced technologies and cybersecurity expertise, they can better respond to emerging threats, optimize their investment, and expand their customer base.
How advanced cybersecurity and AI are driving sector growth
The projected growth for around 30% of MSPs is linked to the adoption of advanced cybersecurity services, including artificial intelligence. MSPs that prioritize innovative solutions will ensure sustainable, secure growth aligned with industry trends. Endpoint protection continues to be a fundamental security pillar for organizations, as it represents a proactive defense against increasingly sophisticated threats. MSPs who adopt this approach will be able to offer customers a comprehensive and up-to-date solution that ticks the following boxes:
- Protects and responds to cyber threats: the application of artificial intelligence enables real-time detection of threat patterns and automated response to prevent attacks before they occur. This reduces the operational burden on the team and improves efficiency in incident management.
- Delivers proactive, intelligent endpoint defense: a Cloud-native solution that unifies advanced EDR, real-time monitoring, and behavioral threat detection. It automatically correlates abnormal behaviors into actionable incidents in real time ‒ enabling immediate response, reducing dwell time, and minimizing analyst fatigue. The result is highly autonomous, efficient, and effective security operations.
- Extends security with advanced modules: a scalable architecture that offers greater visibility and control, reduces the attack surface, and supports compliance. Patch management and encryption are key to closing vulnerabilities and protecting data, while modules like advanced reporting and data control help meet regulatory demands and tailor protection to each customer’s needs.
- Extends security beyond the corporate perimeter: today, remote users are the new perimeter. Cloud-based protection through content filtering, domain-level protection, and AI-powered cybersecurity training builds awareness and defenses wherever users operate.
- Optimizes security with Cloud management: centralized, Cloud-native control automates layered protection across multiple attack surfaces and integrates seamlessly with the customer's infrastructure. It improves threat detection, streamlines endpoint defense, and enables MSPs to manage security with greater automation and efficiency.
The future of MSPs will be determined by how successfully they integrate artificial intelligence and automation into cybersecurity. Protecting the endpoint is the first step to ensuring resilience and competitiveness in an increasingly challenging environment. AI also unlocks new service opportunities ‒ empowering MSPs to deliver advanced detection and response across multiple attack surfaces, support cyber insurance and compliance requirements, and grow their value proposition while increasing profitability. MSPs that adapt quickly to new regulations and strengthen endpoint protection while leading the digital transformation will position themselves as indispensable strategic allies for their customers.
Ready to strengthen your managed services with cutting-edge cybersecurity? Discover WatchGuard’s Endpoint Security portfolio: WatchGuard EPDR, WatchGuard MDR, and Endpoint Security Modules.
If you’d like to learn more about optimizing your endpoint security practices with automation and artificial intelligence, check out the following posts on our blog:
