A quick survey of the market tells us a number of key things about managed hosting in terms of the value proposition offered, as well as the challenges that it can present. The value proposition seems clear: Organizations that need their infrastructure managed and don’t have the internal resources to do so can either expand their IT capabilities or look externally to a service provider to take on the work. Many choose the second option because it is much faster and more cost effective than building an internal function. Elimination of infrastructure management responsibilities combined with a lower price would seem to deliver significant value.

So where’s the downside?

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