A company which offers outsourced IT management and remote administration of IT services for their clients.
This might include a help desk service, network management, backup, security or email hosting.
Providing these services means that their clients don’t have the overhead of managing them, nor the risk, and the MSP benefits by managing similar services for a number of different clients, and therefore being able to scale their own solutions accordingly.
Typically, the MSP bills their clients on a monthly basis, often linked to the numbers of end-users that the client has, and their actual usage.
This pay as you go model is easy to manage for the client, and in return they will likely have the reassurance of SLAs from the MSP on service quality and reliability.