1. MSPs Will Move Away From Infrastructure And Into Software and Applications

Houston-based managed services provider Aldridge has seen its Infrastructure-as-a-Service business slashed in half over the past two years as clients moved their workloads from Aldridge's virtual infrastructure to the public cloud. As a result, Aldridge expects its cloud business to go from 50 percent Software-as-a-Service (SaaS) today to 80 percent SaaS two years from now.

The need to move beyond infrastructure will be accelerated by Amazon Web Services launching their own managed services program in December, which will provide enterprises with a toolkit to manage their AWS infrastructure on their own, as well as services such as monitoring and incident investigation provided directly by Amazon's internal engineers.

Managed services provided through a network operations center (NOC) such as patch management or incident escalation are of far less value in the cloud world since they can be automated. Therefore, in order to stay relevant and avoid commoditization, MSPs must invest in managing the customer applications that are on top of AWS or the operating system.