Datto, Inc. recently announced the release of its fourth annual Global State of the MSP Report, based on a survey of more than 1,800 MSPs around the globe.  The report underscores the continued evolution of the MSP industry and identifies MSP growth drivers in today's challenging environment.

To find out more, VMblog spoke with Rob Rae, Datto's SVP of Business Development.

VMblog:  What were the most significant findings in this year's report and why?  What do they say about the evolving MSP landscape?

Rob Rae:  We concluded three major findings from this year's Global State of the MSP report. First, MSPs that set specific growth goals for their business and increase the portion of their revenue derived from managed services grow faster than their peers. Second, cloud migrations and security are expected to drive opportunities for managed services through the rest of 2020. Lastly, despite the business challenges introduced by COVID-19, the pandemic also presents new growth opportunities for MSPs. The uptick in clients working remotely, and the new required security measures associated with it, offers MSPs the opportunity to expand the scope of services they provide to particular companies as businesses continue to adjust to their new realities.

VMblog:  Are there any major differences between the 2019 report and the 2020 report?  And did anything surprise you?

Rae:  This year, we delved deeper into the technologies MSPs rely on to deliver services to their clients and how they expect that to change in the years ahead. For example, 57% of MSPs expect the use of on-premise servers for critical applications to decline over the next three years, while cloud migrations are expected to offset losses from the COVID-19 setback. Aside from the unforeseeable interruptions caused by COVID-19, we also expanded our research this year to not just include MSPs who are Datto partners and focused on ensuring there was strong representation for the Americas, Europe, and Asia Pacific.

VMblog:  How has COVID-19 impacted MSPs and what are the biggest challenges that lie ahead?  How would you advise them to respond to these challenges?

Rae:  MSPs control 10% of the $1.2 trillion SMB technology spend. While this group was impacted by the pandemic, there is still an immense amount of opportunities for MSPs. When Datto initially conducted its research before the pandemic, MSPs expected to grow their businesses by 17% on average over the next three years. However, our follow up survey, as a result of COVID-19, revealed that MSPs expect to reduce their growth projection 10% to 20%. MSPs need to continue to listen to their customers and stay informed of the trends in the digital economy as the SMB landscape continues to change.

VMblog:  What do the findings reveal about the opportunities for the MSP market in light of COVID-19?

Rae:  Although at a slower pace, MSPs still expect to grow through the pandemic. According to the report, 40% of MSPs surveyed across North America, EMEA and APAC who are expected to reduce their growth projects are still expected to reach $2.5M+ in revenue. Since MSPs can still serve clients that can work remotely during the pandemic, it is likely that unemployment rates will have less of an impact on the MSP industry as MSPs can capitalize on services such as cloud migrations, remote monitoring management, and 5G technology.

VMblog:  According to the report, what are some emerging trends MSPs are most excited for and how can they take advantage of them?

Rae:  Working from home propelled the need for remote management technology and faster wireless networks. So, it would make sense that 5G technology is the most promising emerging technology that MSPs can leverage as the digital economy continues to transform. The ability of 5G enables companies to support more devices, more data, and provide better connectivity, which is now more crucial than ever. MSPs can leverage 5G to assist companies with the development, testing and deployment of technology, helping to fuel innovation in the post-COVID-19 era.

VMblog:  How is Datto helping MSPs prepare for the future as businesses begin to adapt to a "new" normal?

Rae:  Throughout the COVID-19 crisis, Datto has worked diligently to support its partners and keep the MSP community informed and connected through its MSP Covid Resources Center. Additionally, Datto offers its partners global, around the clock (24/7/365) MSP support to assist with whatever challenges they may face.

VMblog:  Finally, where can readers go to find out more about the report?

Rae:  VMblog readers can learn more about the report's findings and access the Global State of the MSP report here.

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