IT and Apps Managed Services Market Trends: Quarterly Report for Q4 2022

February, 2023


In this quarterly report, Avasant provides key information on IT Services Solution and Pricing Trends. The report covers market (buyer) perspective, macro trends from service provider community and finally, the pricing, solution and staffing trends in the space. The report covers trends across services including Infrastructure and Cloud Services, Application Services, and Digital Services. The geographic coverage is global, with a larger share of data points from North America. The report builds on insights gathered through our enterprise interactions, ongoing market research and data collection, as well as AvaMark Price Benchmarking database.

In addition to pricing commentary, Avasant covers market data from providers through a number of sources i.e. Public Disclosures, Market Interactions and Deal Data. This report also highlights the key trends in the market and Avasant’s viewpoint on the future direction of the industry.

Key Buyer Trends Shaping the market:

    • Increase in IT budgets despite the changing economic environment
    • Low IT budget growth in government/ nonprofit organizations
    • Continued increase in cloud spending
    • Security/privacy lead the way in new spending

Key service provider trends:

    • Increase in revenue for providers despite decline in growth rate
    • Increased focus on cost optimization initiatives
    • Stabilization of input cost pressures because of price increments
    • Increase in industry-wide head count and decline in attrition

Managed Services Pricing and Solution Trends:

    • Continued increase in rates for premium skills and digital talent
    • Increase in prices on FTE rate cards while managed services deals remain competitive
    • Clients look to redefine operating models
    • Service providers leverage strategic pillars