Pandemic, Accelerated Digitization Push German Demand for Cloud Services to New Highs

Expanding digitization projects and responses to the COVID-19 crisis drove demand for IT and cloud services to new highs in Germany in 2020 and the spring of 2021, according to a new report published today by Information Services Group (ISG) (Nasdaq: III), a leading global technology research and advisory firm.

The 2021 ISG Provider Lenstm Next-Gen Private/Hybrid Cloud ? Data Center Services & Solutions report for Germany finds that pandemic-related work-from-home requirements have made managed services, hosting and colocation providers more important than ever to German enterprises. Midmarket companies seeking to maintain their market presence have turned to providers for consulting and support for implementation and operations. Larger organizations have been working on expanding their cloud resources, looking for partners to help them take on new levels of complexity.

"German enterprises have redoubled their commitment to digitization while investing less in on-premises hardware," said Andrea Spiegelhoff, partner, ISG EMEA, based in Germany. "Private and hybrid cloud services offer the flexibility and scalability they need."

There are more than 1,000 providers of services and hosting in the DACH region (Germany, Austria and Switzerland), a market of almost 100 million people that is particularly rich in medium-sized enterprises, with more than 5 million midsize companies and groups, ISG says. Growth here reflects the regional demand for cloud-based services, which hit an all-time high in the first quarter of 2021, according to the EMEA ISG Indextm. The overall sourcing market, including both as-a-service and managed services engagements, grew 20 percent compared with the first quarter of 2020.

During the pandemic, managed services providers (MSPs) have been setting up and operating workspaces for home offices and home schooling, while managed cloud hosts provide server capacity and colocation providers make standardized data centers available with sufficient connectivity and bandwidth, ISG says.

Digitization projects are addressing a range of needs for German enterprises, the report says. For example, a growing number of companies require latency of 35 milliseconds or less for applications such as edge computing, autonomous driving, mixed-reality experiences and IT/OT solutions that combine the IT and operational sides of an enterprise. Low-latency 5G mobile technology plays an increasingly important role in these applications.

Meanwhile, the line between private and public clouds is blurring as managed hosting providers that previously owned data centers increasingly rely on colocation centers, ISG says. Integrators, public cloud providers and companies downsizing or closing their data centers are also lining up to use colocation facilities, which provide space, security, modern infrastructure and support from a single source.

The 2021 ISG Provider Lenstm Next-Gen Private/Hybrid Cloud ? Data Center Services & Solutions report for Germany evaluates the capabilities of 95 providers across six quadrants: Managed Services for Large Accounts, Managed Services for the Midmarket, Managed Hosting for Large Accounts, Managed Hosting for Midmarket, Colocation Services for Large Accounts and Colocation Services for Midmarket.

The report names PlusServer as a Leader in three quadrants. Arvato Systems, Atos, Axians, CANCOM, Claranet, DATAGROUP, Deutsche Telekom (TDG), Fujitsu, IBM, q.beyond and T-Systems are named as Leaders in two quadrants each. The report names *um (Orange), Accenture, All for One Group, Capgemini, Computacenter, CyrusOne, DXC Technology, Equinix, Interxion: A Digital Realty Company, ITENOS, KAMP, Keppel Data Centres, maincubes, Materna, myLoc, noris network, NTT DATA, NTT Ltd., PFALZCOM, Rackspace Technology, STACKIT, Telehouse and TelemaxX as Leaders in one quadrant each.

In addition, Cognizant, Cyxtera, Infosys, Release42, T-Systems and Unisys are named as Rising Stars?companies with a "promising portfolio" and "high future potential" by ISG's definition?in one quadrant each.

Customized versions of the report are available from Claranet, Deutsche Telekom, ITENOS, KAMP, PlusServer, Release42, T-Systems and TelemaxX.

The 2021 ISG Provider Lenstm Next-Gen Private/Hybrid Cloud ? Data Center Services & Solutions report for Germany is available to subscribers or for one-time purchase on this webpage.

About ISG Provider Lenstm Research

The ISG Provider Lenstm Quadrant research series is the only service provider evaluation of its kind to combine empirical, data-driven research and market analysis with the real-world experience and observations of ISG's global advisory team. Enterprises will find a wealth of detailed data and market analysis to help guide their selection of appropriate sourcing partners, while ISG advisors use the reports to validate their own market knowledge and make recommendations to ISG's enterprise clients. The research currently covers providers offering their services globally, across Europe, as well as in the U.S., Germany, Switzerland, the U.K., France, the Nordics, Brazil and Australia/New Zealand, with additional markets to be added in the future. For more information about ISG Provider Lens research, please visit this webpage.

A companion research series, the ISG Provider Lens Archetype reports, offer a first-of-its-kind evaluation of providers from the perspective of specific buyer types.

About ISG

ISG (Information Services Group) (Nasdaq: III) is a leading global technology research and advisory firm. A trusted business partner to more than 700 clients, including more than 75 of the world's top 100 enterprises, ISG is committed to helping corporations, public sector organizations, and service and technology providers achieve operational excellence and faster growth. The firm specializes in digital transformation services, including automation, cloud and data analytics; sourcing advisory; managed governance and risk services; network carrier services; strategy and operations design; change management; market intelligence and technology research and analysis. Founded in 2006, and based in Stamford, Conn., ISG employs more than 1,300 digital-ready professionals operating in more than 20 countries?a global team known for its innovative thinking, market influence, deep industry and technology expertise, and world-class research and analytical capabilities based on the industry's most comprehensive marketplace data. For more information, visit www.isg-one.com.