This year's Gartner Magic Quadrant report for global network services unearthed a new trend: Some enterprises are putting a higher priority on agility and innovation and are starting to favor smaller providers over the established market leaders.
Solution providers offering networking services today, such as cloud connectivity, SIP trunking, and hybrid WAN or SD-WAN services, can cash in on this shift in the market by working with smaller -- and often more channel-friendly providers -- to build solutions that are tailor-made for their end customers.
Master agent Avant, based in Chicago, pairs solution providers with network service providers. Ian Kieninger, Avant's CEO, said that as technology demands become more complex, it's getting harder for the market heavyweights to keep up with smaller, more agile providers that are offering innovative services, such as SD-WAN and Unified Communications as a Service, that can be layered on top of the core network.
"The smaller providers who are really laser-focused are gaining the attention of the enterprise accounts," Kieninger said. "The big brands are no longer the reason people buy."
And the authors of this year's Magic Quadrant report agree. "Global enterprise evaluation criteria are placing less emphasis on larger providers, network scale and the availability of large numbers of provider staff to deliver customized capabilities to address site- or application-specific requirements," they wrote in the report.
As businesses adopt cloud services and rely more on public internet connections as a primary method of WAN transport, they have become more willing to go with smaller providers offering solutions consumed on an "as-a-service" basis, according to the report.
Masergy Communications, a midsize hybrid networking and cloud communications service provider, is an example of a smaller provider that is gaining more market share. Masergy was the only company to ascend to the right in this year's Magic Quadrant report, indicating that the company has improved on its ability to articulate its current and future market direction when compared with last year. Masergy was named a "Visionary" in global network services for the second consecutive year in the Magic Quadrant.
This year's Leaders quadrant consisted of six telecom giants, including AT&T and Verizon in the U.S., two mainstays in Gartner's annual global network services report. BT, NTT, Orange Business Services and Tata Communications also made the Leaders list.
Eighteen-year-old Masergy is majority-owned by Berkshire Partners. The company is currently serving 1,400 enterprise clients in over 85 countries, with a 99 percent customer retention rate. In fact, Masergy and VoIP provider Vodafone, listed as a "Challenger" in this year's report, scored the highest in customer service out of the 16 providers identified in the report, according to Gartner.
Avant, a longtime Masergy partner, said that Masergy has been a consistently top-selling supplier in its portfolio for years. That's because the Plano, Texas-based provider was one of the first to come to market with a next-generation WAN and was among the first of the service providers to deploy SD-WAN. Masergy has had "unmatched" network performance and has been offering tools that give customers more visibility and control over their network -- something other providers weren't offering at the time, Kieninger said.
"Masergy is also delivering the highest customer service experience we have seen in the market -- it's not even close," he said. "The fact that they can offer complex technology with amazing customer care is giving them a huge advantage, and why they will continue to move up the quadrant."
Masergy, for its part, attributes its position in the Magic Quadrant to its focus on helping enterprises successfully transition to digital platforms through its agile network, as well as its highly regarded customer service.
“We believe being named a Visionary for the second consecutive year while this year moving further to the right on our completeness of vision and higher in our ability to execute in the Gartner Magic Quadrant … is a testament to Masergy’s focused approach to innovation and operational excellence,” Chris MacFarland, Masergy's CEO, said in a statement.
As enterprises consider smaller, often more flexible providers for their networking needs, the number of global network service providers included in the report grew in 2018, according to Gartner. The report's authors did caution, however, that regional providers with limited global capabilities will still need to be combined with additional services from other providers to properly fulfill the networking needs of a global enterprise.