Managed Service Provider

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Managed Service Provider Definition

A managed service provider is a third-party company that provides network, application and system management services to enterprises with a pay-as-you-go pricing model. The managed service provider allows enterprises without IT expertise to improve their day-to-day operations and avoid IT maintenance issues. Managed IT service providers have existed since the 1990s. They started with IT infrastructure management, developed into application service providers (ASPs) but now services include mobile device management, cloud storage, remote monitoring and management, and security-as-a-service.

Diagram depicting a company acting as a managed service provider for other companies, managing their IT, security, application delivery, data storage, networking and other virtual services.

What is a Managed Service Provider?

When an enterprise does not have the resources to employ a dedicated IT team to handle development, maintenance and break fix, those needs are outsourced to a managed IT service provider. The managed service provider works remotely and for a fixed cost. This allows small and medium-sized businesses to reduce their IT budget, be cost-effective and focus on the core business. Large corporations and enterprises, such as government agencies, will contract with a managed service provider when they have budget and hiring limitations.

How do Managed Service Providers Work?

Using a managed service provider does not mean an enterprise gives up all control and responsibility for IT operations. Using a managed service provider is a strategic method for enterprises to keep some operations in-house while outsourcing others. Together, the company and the managed service provider determine the best course.

Initially, the managed service provider reviews an enterprise’s processes to find ways to improve efficiency, lower risk and reduce costs.

Typically, the managed service provider handles the most time-consuming, complex ad repetitive work. They also provide on-going maintenance and support.

What do MSPs do?

The managed service provider business model offers more than just convenient and lower cost IT application management. Cloud managed service providers help companies think strategically about cloud computing to avoid pitfalls and fully appreciate the benefits. Not everything can and should migrate to the cloud and a managed service provider can provide guidance while helping an enterprise grow its business utilizing the cloud.

A cloud managed service provider handles operations that customers don’t see, such as IT, human resources, vendor management and procurement. Costs are predictable with a fixed monthly fee. Enterprises save money by outsourcing IT employees and avoiding unplanned maintenance and repairs.

The expertise of the managed IT service provider gives top IT knowledge to small and medium sized businesses that wouldn’t possess on their own. This helps organizations reduce risk and liability when it comes to compliance with government regulations.

Other benefits include:

• Improved Security: Backup and disaster recovery plans for any possible incident. Network monitoring around the clock.

• Comprehensive Reporting: View of entire infrastructure in real time, which helps enterprises track all activity.

What are Examples of Managed Service Provider (MSP) Companies?

There are specialized versions of managed service providers in areas of security, business continuity and data storage solutions. Managed security service providers, and managed IT service providers can also focus on specific industries like legal, financial services, healthcare and government agencies. The managed services market is rich with specialist providers of different sizes, focus and cost.

What Does VMware NSX Advanced Load Balancer Offer for a Managed Service Provider?

VMware NSX Advanced Load Balancer is purpose-built for the multi-cloud and mobile era using a unique analytics-driven, 100% software approach. VMware NSX Advanced Load Balancer is the first platform to leverage the power of software-defined principles to achieve unprecedented agility, insights, and efficiency in application delivery. Managed service providers can use VMware NSX Advanced Load Balancer to deliver, secure and manage their applications on behalf of customers.

For more on the actual implementation of load balancing, security applications and web application firewalls check out our Application Delivery How-To Videos.

For more information on MSPs see the following resources: