27% of MSPs forecast cybersecurity revenue will rise by over 20%
Like previous years, 2022 was marked by the relentless rise in cybersecurity threats, resulting in higher investment in cybersecurity solutions and managed services (MSP).
According to Canalys Q3 2022 data, despite deteriorating economic conditions, the global cybersecurity market grew 15.9% year-on-year to $17.8 billion. Channel sales accounted for 90.6% of the overall market and were up by 15.9% compared to 2021, outpacing direct sales.
Advantages of hiring an MSP in 2023
These figures have MSPs Managed Service Providers (MSPs) looking ahead to 2023 with optimism, as 27% expect their cybersecurity revenues to grow by over 20% this year. Similarly, a further 27% anticipate more moderate growth between 11% and 20%. Meanwhile, only 10% of MSPs expect a decline in cybersecurity sales.
MSPs provide a range of advantages to organizations that hire their services:
For starters, it is estimated that hiring managed cybersecurity services can help lower a company's IT costs by up to 45% and can help boost productivity by 65%. It can also reduce downtime costs.
MSPs offer scalable solutions that adapt to a company’s changing needs and growth.
This model helps keep IT costs predictable and scalable, depending on the services the company hires. This frees up cash flow so that the company can reinvest in its growth.
It also addresses the lack of internal cybersecurity skills. While upskilling programs and upgrading the skills of existing workers are good options, conducting this type of training comes with additional expense and time investment. In contrast, an MSP has the talent to provide all the support needed.
Companies are familiar with these benefits and, as a result, a growing number are deciding to outsource their cybersecurity. Hiring these services makes financial sense as it allows access to true security professionals, which is imperative in today’s threat landscape. This trend is reflected in the sector’s growth, which has also drawn interest from venture capitalists and other MSPs looking to expand their business, attracted by the recurring revenue and the ability to scale their business offering. In a previous blog post, we discussed this subject on how to make your MSP business attractive to other buyers.
What are the MSP industry trends for this year?
In 2023, MSPs are focused on ascertaining which solutions work and which fail to contain an attack as well as they should. They will also have to work out how to deal with IT talent shortages efficiently. As global compliance regulations become stricter, partners need to work with a security company that can deliver a comprehensive and easily integrated solution that provides facilities to train their staff. This trend is a continuation of a market shift we discussed in a blog post last year, fulfilling one of Gartner's predictions for the next two years that 70% of MSPs and MSSPs will consolidate the vendors they work with and switch to a single vendor for their cybersecurity needs.
Using a single-vendor platform benefits MSPs by making it easier to train their employees and customers using a single, unified framework rather than multiple solutions. It also supports security monitoring, as there is a single dashboard to review and troubleshoot issues as they arise. Finally, a cohesive platform means a single point of contact to address security issues, which is a clear advantage when dealing with cybersecurity incidents. Working with a sole vendor improves fluidity in identifying and resolving problems.
MSPs already adopting this approach have seen how employees improve their security knowledge and troubleshooting skills. Employees’ confidence in helping customers grows as they only have to master one platform and its capabilities and can even begin to offer additional services and capabilities. This enables these MSPs to expand their managed services and satisfy their customers by offering unified security on a single platform like WatchGuard's.