data center researchManaged-services, or “full-service,” network outsourcing was the fastest growing segment in a network outsourcing market that overall showed growth moderating in 2013, according to a new report from Infonetics Research.

Overall, network equipment manufacturers earned $68.1 billion in revenue worldwide from carrier outsourcing contracts in 2013, a 3.8% year-over-year rise. Managed services network outsourcing was the fastest growing market segment, rising 6 percent to exceed $36 billion, according to Infonetics’ “Service Provider Outsourcing to Vendors” report.

In managed services network outsourcing, “an equipment vendor takes over an operator’s entire infrastructure on an end-to-end basis over an extended period, including network maintenance, operations, planning and design tasks,” Infonetics explains in a news release.

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Looking out to 2018, Infonetics expects full-operation and RAN (Radio Access Network) sharing will drive global managed services network outsourcing market revenues to $45 billion, though growth is likely to be moderate for the market as a whole.

“At this point, it’s hard to find new large outsourcing deals unless China comes on board, which may eventually happen due to the ongoing discussion about 4G network sharing,” noted Stéphane Téral, Infonetics’ principal analyst for mobile infrastructure and carrier economics.

“As a result, last year was marked by musical chairs: Huawei and ZTE picked up some deals, while Alcatel-Lucent and Nokia exited some unprofitable contracts. But overall, demand for managed services with a strong focus on user experience remains unabated.”

Other key takeaways from Infonetics latest carrier outsourcing report include:

  • Ericsson held tight as the service provider outsourcing revenue leader in 2013, while
  • HP leapfrogged IBM to take the #2 spot
  • #4 Huawei continued its ascent, gaining 2.4 percentage points and chalking up the strongest year-over-year revenue growth of any vendor
  • Growth in the overall market moderated in 2013 due to a combination of forces for Alcatel-Lucent, Ericsson, and Nokia, and major contract restructuring at Alcatel-Lucent and Nokia

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