A key report from N-able has revealed that cybersecurity remains a key revenue driver for MSP, with a sharp projected uptick for managed services growth over the coming year.
The company shared its second annual MSP Horizons Report in partnership with Canalys, summarising the top findings from research with global MSPs that reveals this growth will be driven by a number of key factors, including the maturity of cybersecurity services.
The increasingly successful “MSP 3.0” model underscores the importance of focusing on long-term opportunities vs. short-term wins to drive both scalability and profitability.
Robin Ody, MSP Analysis Practice Lead, Canalys shared: “MSPs are operating at a time of significant change, and this is impacting on the managed services business model, affecting the services partners provide and the ways they package these capabilities.”
Ody points out that the forward-looking partner is focusing on those specialisations that will provide the most value to the customer and help them remain competitive: cybersecurity, cloud, AI, risk management, compliance monitoring, and vertical capability.
Key report findings show that the growth outlook is positive, with 59% of MSP respondents expect to grow overall revenue by 20% or more in 2025.
The top challenges to growth include new customer acquisition and upskilling staff.
Other findings show that the cybersecurity force factor continues to strengthen: cybersecurity managed services sales growth is expected by 90% of respondents in 2025, up from 80% in the previous year’s report.
The most in demand future managed backup and disaster recovery services are SaaS application backup (53%) and AI-powered backup and recovery (51%).
“A central theme of this year’s report is cyber resilience and a constant trend remains: cybersecurity is a key revenue driver,” said John Pagliuca, N-able President and CEO (pictured).
“The line between IT operations and security operations has blurred, and the leading MSPs differentiate themselves by addressing security across the entire attack lifecycle: from protection and detection to response and recovery. When it comes to cybersecurity, ‘good enough’ is no longer good enough.”
Elsewhere, AI adoption is maturing with more attention to governance and risk management – the biggest AI use cases are for building workflow automations and automating the sales and ticketing process.
M&A is now back on the agenda - 90% of those surveyed are interested in M&A, with specific growth tactics (acquiring new skills and/or regions) the main motivator—up from 44% last year.
Cloud modernisation is also of strong interest, with modern MSPs are cloud-first for software and infrastructure according to the findings.
John Joyce, Owner, CRS Technology Consultants commented: “To see things distilled down to numbers and to see the feedback from the sample group reflecting what we’re seeing is a powerful validation, and the cybersecurity piece is only going to continue to grow because we don't have a choice.
“The report clearly highlights that many of us have been able to go on and build a piece of our business out of it, and I don't see that changing. I see it only increasing.”
The MSP Horizons Report was conducted from October 2024 to November 2024, and partners were asked to provide feedback via an online questionnaire distributed by N-able and Canalys via its Candefero website.
Image shows: John Pagliuca, President and CEO, N-able