Cisco has no intention of cutting out the middle man — that is, its channel partners — as it transitions more of its portfolio to an as-a-service model. In fact, channel partners, or more specifically managed service providers (MSPs), are at the heart of Cisco’s subscription-service push, executives for the company emphasized during a round-table discussion this week.

“Something like 90-95% of our managed services are partner-managed services,” Oliver Tuszik, SVP of global partner sales at Cisco, said. “We don't have a real managed-service business that we do directly.”

And looking ahead, channel partners will play a critical role in driving Cisco's revenues, the executives said. The company projects its total-addressable market for managed services alone to exceed $113 billion by 2025.

This emphasis on managed services comes as the market experiences a shift in how people are buying and consuming technology, Alexandra Zagury, VP of partner managed and as-a-service at Cisco, said.

“Customers today buy outcomes and are expecting experiences,” she said. “They're moving away from the capex to the opex.”

And as the number of applications and amount of data grow unabated, enterprises are faced with finding products that not only satisfy the requirements of the network or security operations teams but the entire ecosystem.

“This is why we’re seeing such a big growth and interest in managed service,” Zagury said. “The best way to deliver an outcome now is through a managed service.”

Customers are looking for services with consumption-oriented models and increasingly favoring those that are software based and cloud delivered, Logicalis COO Michael Chanter said. Logicalis is a global managed service provider offering a wide range of services ranging from SDN to hybrid cloud and workforce mobility, with many offered in collaboration with Cisco.

“When we build our offerings, what we're looking for is how can we bring the best-of-breed technology from our strategic partners, Cisco and Microsoft for example, blend that with our own [intellectual property] expertise and our global reach to give a customer an outcome that they're looking for,” he said.

Customers are asking more of their managed service providers than ever. It’s not just about availability, compliance, and patching, he explained. There’s a “very strong focus toward user experience.”

To address customer and channel partner needs alike, Cisco has announced a series of initiatives around its MSP-focused product portfolios. This includes ensuring those products are multi-tenant, that they support standard API hooks for integration in to MSP orchestrators, and partners can import data into their data lakes for analysis, Zagury explained.

However, Cisco hasn’t stopped there and has taken the additional step of working with channel partners directly to customize their products. This is “all about being easy to do business with … taking away the friction from the system,” she said. “When a customer asks a partner for an outcome, they’re really looking at the partner.”

Because of this, it’s in Cisco’s best interest to provide support and in some cases, like its secure access service edge (SASE) platform, co-develop services tailored to the MSPs' needs.

“As we deploy our SASE solutions, we’ve also created a program called Lighthouse … where we, hand-in-hand, do a white-glove service when it comes to service creation with our partners,” she explained, adding that more than 20 MSPs are working with Cisco Lighthouse.