Change is a constant in the world of managed services, but the pace of transformation today is unlike anything we’ve seen before. As we move through 2025, the global managed services market is expected to grow by 13% according to Canalys, reaching an impressive $595 billion in revenue. The days of reactive, break/fix support are firmly behind us, though. In their place, predictive technologies, integrated security, and flexible service delivery are redefining what it means to be an MSP.
But how did we get here? And what’s driving this shift from traditional support models to a more dynamic, platform-based approach? To answer these questions, it’s worth taking a brief look back at the MSP journey and exploring what the future holds for providers ready to adapt.
Let’s dive into the evolution of managed services and discover why the next chapter is all about being proactive, platformized, and prepared for whatever comes next.
from break/fix to predictive and platformized
To appreciate where we are, it’s worth looking back. The MSP journey began with MSP 1.0, which offered break/fix services, reactive support, and a local, hardware-focused mindset. As technology matured, MSP 2.0 took over, introducing proactive monitoring (RMM), recurring revenue models, and more unified service stacks. This was the age of centralized IT support, often with cybersecurity bolted on as an extra.
Now, MSP 3.0 is here. This new model is characterized by:
- AI-based, predictive services: automation and agentic AI are moving beyond hype, starting to deliver real value in ticketing, monitoring, and security.
- Cybersecurity as standard: no longer an add-on, security is now baked into every service stack. Managed detection and response (MDR) services are forecast to grow by 16% this year alone.
- Platformization and marketplace delivery: over half of all MSPs will use SaaS marketplaces to buy and deliver services in 2025, reflecting a shift to more flexible, on-demand models.
- Geographic and service expansion: MSPs are operating on a broader, often international scale, with a focus on marketing and brand differentiation.
why the shift? the new MSP buyer
Technology is not the most significant driver of this shift: today’s MSP clients are younger, more digitally savvy, and more demanding. They expect co-managed, cloud-first solutions and are comfortable mixing and matching services from various providers. The days of selling a static, “one-size-fits-all” stack are fading; customization and expertise are the new differentiators.
At the same time, commoditization is accelerating. Basic IT services are no longer enough to stand out. The modern buyer wants a partner who understands their business, can navigate complex regulatory environments, and delivers measurable value beyond uptime and support tickets.
the new table stakes: security, compliance, and consulting
Security is now a board-level issue. With cyber threats intensifying and regulations like the EU’s DORA raising the bar, MSPs must be fluent in both technology and compliance. The lines between IT, compliance, and cybersecurity are blurring, and MSPs are expected to deliver across these high-growth areas, with compliance services alone projected to grow 28% in 2025.
As we will see in part 2, consulting is also on the rise. MSPs are increasingly expected to advise clients on everything from AI adoption to regulatory compliance, not just deliver technical fixes. This shift is driving a convergence between professional services and managed services, opening new revenue streams and deepening client relationships.
the role of AI and automation
In 2025, AI professional services are projected to grow by over 30%, driven by demand for AI-powered data security and consulting. While many MSPs are still learning how to move beyond proof-of-concept, the direction is clear: agentic AI— systems that can take initiative and automate processes from ticketing to predictive maintenance.
It not only improves efficiency but also enables MSPs to deliver proactive, value-added services that were previously out of reach for all but the largest providers.
marketplace models and M&A
The rise of cloud marketplaces is changing how services are bought and sold. Over 54% of MSPs will use these platforms in 2025, offering clients more choice and flexibility. At the same time, M&A activity is booming—up 45% this year—as providers seek scale, new capabilities, and broader geographic reach.
This consolidation is raising the bar for everyone, making it even more critical for MSPs to differentiate themselves through expertise, brand, and advanced service offerings.
conclusion: the opportunity ahead
The managed services industry is no stranger to change, but the speed and scale of today’s transformation are setting a new benchmark. As MSPs leave behind the break/fix era and step confidently into a world defined by predictive technologies, integrated security, and platform-driven delivery, one thing is clear: adaptation is essential.
Clients are more discerning, the competitive landscape is more dynamic, and the expectations placed on MSPs have never been higher. Those who embrace this evolution (leveraging AI, prioritizing cybersecurity, and delivering tailored, value-driven solutions) will not only meet the demands of the modern buyer but also unlock new opportunities for growth and differentiation.
The journey from reactive support to proactive, platformized services is just the beginning. As the market continues to expand and client needs evolve, the MSPs that thrive will be those ready to innovate, consult, and lead. The next chapter promises even greater possibilities for those prepared to shape it.
In part two, we’ll explore how sustainability and circular IT are becoming integral to the MSP 3.0 toolkit—and why clients will increasingly look to their MSPs to guide them through these new frontiers. In the meantime, don’t hesitate to contact us for any questions or guidance in your journey, and of course, for all your IT infrastructure needs!
