As applications, data, and infrastructure become more complex and more infrastructure shifts to the cloud, organizations will seek help with their network operations. In addition, network service diversification and virtualization are driving the demand for more full-stack skill sets from engineers. This is likely to push the idea of outsourcing network operations.
As shown in Figure 2 from our full report, Network Operations Outsourcing Trends and Customer Experience, network operations were outsourced, entirely or in part, by 48% of IT organizations in 2023. This represents an increase from the previous year’s 40%. While the overall trend is reflected positively, network operations outsourcing has fluctuated over the years. Companies are increasingly outsourcing non-mission-critical tasks so they can focus on the competencies that are most crucial to their success. The macroeconomic environment may be a factor in the rise and fall of the frequency of this function.
Networks are becoming more complex, and cost reduction is one factor in choosing to outsource network operations. However, there are additional factors driving network operations outsourcing: its complexity, cloud computing, cybersecurity threats, an increasing global workforce, and greater customer demands, to name a few.
Today, major IT and telecom industry service providers and even disruptive newcomers are competing with regional providers for market share. In the past, large equipment vendors only provided the hardware that served as the network backbone. However, these giants are beginning to recognize the potential of value-added network services. Businesses can now obtain dependable infrastructure with expert network design, planning, and even network support operations from a single source.
“For some companies, outside expertise can offer better service and be more economical and productive than attempting to retain the necessary skills internally,” said Asif Cassim, principal analyst for Avasant Research, based in Los Angeles. “Strong governance and choosing the right services to outsource are key, however.”
In the outsourcing market, network operations are a growing segment and can provide good service benefits at reasonable costs. As the cloud migration continues, and applications, data, and infrastructure get more sophisticated, we anticipate a steady increase in network operations outsourcing over the coming years.
Our full report examines adoption trends and customer experience with network operations outsourcing. We report on the percentage of organizations outsourcing it (frequency) and the average amount of work outsourced (level). We also present data on the cost and service experience and how these trends differ by organization size and sector. We conclude with guidelines to consider when outsourcing network operations.
This Research Byte is a brief overview of our study, Network Operations Outsourcing Trends and Customer Experience. The full report is available at no charge for subscribers, or it may be purchased by non-clients directly from our website (click for pricing).