U.S. Enterprises Embrace Managed Network Services to Navigate Complexity and Support AI Integration

U.S. Enterprises Lead in Network Outsourcing Adoption

A new report from Information Services Group (ISG) highlights a growing trend among U.S. enterprises: the adoption of managed network services to support AI and other emerging technologies across increasingly complex networks 1

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. This shift comes as businesses face mounting challenges in enterprise networking, including stricter regulations, heightened security risks, and the rise of remote and mobile work.

AI Integration in Managed Network Services

Providers of managed network services are actively incorporating AI and automation into their solutions to address the complexities of modern networks. These AI-based tools are being utilized to enhance various aspects of network management:

• Network monitoring
• Troubleshooting
• Optimization

Dieter Thompson, partner and president of ISG's Network and Software Advisory business, notes, "The rapid evolution of digital technologies, including AI, has made networks more complex and placed IT organizations under increasing stress" 1

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The Shift Towards Outsourced Networks

U.S. enterprises are at the forefront of network outsourcing, with a higher adoption rate compared to their counterparts in Europe or Asia Pacific. The trend began with co-managed networks but has since evolved:

1. Initial stage: Co-managing networks with service providers
2. Current trend: Migration to fully managed approaches

This transition aims to further reduce complexity and operational effort for enterprises.

Benefits of Comprehensive Network Services

The adoption of comprehensive network service suites offers several advantages:

1. Secure foundation for business transformations
2. Allows organizations to focus on core operations
3. Reduces risks associated with network updates
4. Facilitates smoother implementation of new technologies like generative AI

Emerging Trends in Managed Connectivity

The report identifies rising demand for specific types of managed connectivity services:

1. Direct Internet Access (DIA): Provides enterprises with exclusive ISP links for critical applications requiring high performance and security.
2. Voice over IP (VoIP): Growing in popularity due to increased remote work and the expansion of high-speed broadband and 5G networks.

Network as a Service (NaaS): The Next Frontier

NaaS is emerging as a potential next step in managed network services, particularly for midsize organizations. It offers several benefits:

• Allows companies to rent networking services
• Easy integration with current network deployments across regions
• Pay-as-you-need model

While most large U.S. enterprises are conducting NaaS trials, interest is even higher among midsize companies 1

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Market Leaders and Rising Stars

The ISG report evaluates 33 providers across three quadrants:

1. Managed Network Services Evolution
2. Managed Enterprise Connectivity Solutions
3. Network as a Service

Leaders across all three quadrants include Accenture, AT&T, Comcast Business, GTT, Kyndryl, and Orange Business. The report also identifies several Rising Stars, including Capgemini, Colt, and HCLTech 1

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As U.S. enterprises continue to grapple with the complexities of modern networking, the trend towards managed services and outsourcing is likely to persist, driven by the need for flexibility, security, and support for emerging technologies like AI.