Business of Tech: Daily 10-Minute IT Services Insights

The episode identifies a fundamental structural shift in the MSP and IT services landscape: vendor channel consolidation and ecosystem dependency are increasingly determining who controls customer relationships, margins, and access to recurring revenue streams. Companies such as Microsoft, Anthropic, and Huntress are actively reshaping the ecosystem by investing significant resources in partner programs and platform strategies that dictate operational baselines and restrict neutrality. This realignment is driving MSPs to deliberately choose platform alignments, as attempting to remain neutral increasingly results in a loss of relevance and market access. Central to this shift is Anthropic’s $100 million investment in launching the Claude Partner Network for 2026, which creates certification and co-sell incentives for firms capable of implementing Claude within enterprise environments. According to Dave Sobel, this is not long-range product development but a concentrated customer acquisition cost to rapidly build channel coverage. In parallel, Microsoft is embedding Anthropic models within Copilot, shifting to a multi-model approach that retains flexibility at the AI model layer while keeping Azure as the entrenched operational platform. Supporting developments reinforce these channel and ecosystem pressures. Huntress’s move to expand its partner program to value-added resellers (VARs) dilutes its previously MSP-exclusive channel, removing some of the distribution advantages MSPs may have relied upon. Sonomi’s positioning of third-party risk management as an MSP revenue opportunity comes amid rising supply chain risk, as supported by ConnectWise’s 2026 MSP Threat Report highlighting increased identity abuse and supply chain attacks. Simultaneously, declining PC shipments—especially for budget devices—are shifting the economic emphasis from hardware projects to operational service engagements such as identity governance and lifecycle management. The operational implications for MSPs are clear: partner program frameworks have become the gatekeepers of pricing, leads, and ongoing service annuities, reducing the room for independent strategy or procurement-driven decisions. Ecosystem alignment must be intentional and based on a realistic assessment of program timelines, certification windows, and revenue structure. As hardware refresh cycles slow and vendors consolidate services and identity requirements, MSPs face increased dependency risk, potential margin erosion, and diminished negotiating leverage. Those failing to anticipate or adapt to these shifts risk being relegated to subcontractor roles without control over customer relationships or recurring revenues. Three things to know today 00:00 AI Channel War 02:27 Identity Baseline Shift 03:43 Refresh Revenue Shift 04:46 Why Do We Care?  Supported by:  Small Biz Thoughts Community     💼 All Our SponsorsSupport the vendors who support the show:👉 https://businessof.tech/sponsors/ 🚀 Join Business of Tech PlusGet exclusive access to investigative reports, vendor analysis, leadership briefings, and more.👉 https://businessof.tech/plus 🎧 Subscribe to the Business of TechWant the show on your favorite podcast app or prefer the written versions of each story?📲 https://www.businessof.tech/subscribe 📰 Story Links & SourcesLooking for the links from today’s stories?Every episode script — with full source links — is posted at:🌐 https://www.businessof.tech 🎙 Want to Be a Guest?Pitch your story or appear on Business of Tech: Daily 10-Minute IT Services Insights:💬 https://www.podmatch.com/hostdetailpreview/businessoftech 🔗 Follow Business of Tech LinkedIn: https://www.linkedin.com/company/28908079YouTube: https://youtube.com/mspradioBluesky: https://bsky.app/profile/businessof.techInstagram: https://www.instagram.com/mspradioTikTok: https://www.tiktok.com/@businessoftechFacebook: https://www.facebook.com/mspradionews Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

AI deployment is compressing margins and altering the economic structure of the IT services market, with digital platforms and private equity–backed consulting now determining who controls distribution, interfaces, and downstream value capture. As referenced by Dave Sobel, developments such as large language models reshaping search, IT distributors repositioning as digital marketplaces, and private equity standardizing AI consulting are reducing the role of traditional MSPs to commoditized implementation labor. Concrete market evidence includes the Global Technology Distribution Council’s report citing that 80% of vendors see partner ecosystem growth as key, while 86% are using or testing digital platforms to drive cloud and AI services. Examples such as Anthropic’s discussions to create AI consulting joint ventures with Blackstone and Hellman Friedman, as well as OpenAI’s partnerships with Thrive Holdings and Shield Technology Partners, show that operational models are being standardized and consolidated. Meanwhile, AI-powered search is reducing clicks to original content by up to 89%, transferring value to whoever controls the user interface. Supporting data from surveys conducted by the SMB Group, Pega Systems, and Atlassian highlight that 53% of SMBs are using AI, but only 3% of organizations report measurable business transformation despite a 33% productivity boost. Consumers show distrust in AI-driven customer service, and employee burnout and reduced confidence indicate that MSPs are absorbing increased operational complexity and support burdens even as margins compress. These developments reinforce the channel consolidation and margin repricing mechanisms described above. For MSPs and IT leaders, the practical risks include growing dependency on distributor and vendor digital marketplaces, narrowing ability to influence platform economics, and the transfer of governance obligations without matching margin. Priority areas are building defensible, repeatable governance frameworks around AI, owning escalation and validation paths, and repositioning services toward process redesign engagements—not commoditized tool deployment. Failing to establish an IP or governance wedge may result in MSPs being locked into subcontractor roles with little leverage over pricing or client outcomes. Three things to know today: 00:00 Channel Bypassed 02:26 Delivery Commoditized 04:15 MSPs Left Holding 07:12 Why Do We Care?  Supported by:  ScalePadSmall biz Thought Community      💼 All Our SponsorsSupport the vendors who support the show:👉 https://businessof.tech/sponsors/ 🚀 Join Business of Tech PlusGet exclusive access to investigative reports, vendor analysis, leadership briefings, and more.👉 https://businessof.tech/plus 🎧 Subscribe to the Business of TechWant the show on your favorite podcast app or prefer the written versions of each story?📲 https://www.businessof.tech/subscribe 📰 Story Links & SourcesLooking for the links from today’s stories?Every episode script — with full source links — is posted at:🌐 https://www.businessof.tech 🎙 Want to Be a Guest?Pitch your story or appear on Business of Tech: Daily 10-Minute IT Services Insights:💬 https://www.podmatch.com/hostdetailpreview/businessoftech 🔗 Follow Business of Tech LinkedIn: https://www.linkedin.com/company/28908079YouTube: https://youtube.com/mspradioBluesky: https://bsky.app/profile/businessof.techInstagram: https://www.instagram.com/mspradioTikTok: https://www.tiktok.com/@businessoftechFacebook: https://www.facebook.com/mspradionews Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

The dominant structural mechanism highlighted is the industry-wide shift toward liability transfer and governance gaps in AI procurement, deployment, and incident response. According to Dave Sobel, both vendors and organizations are accelerating AI adoption without corresponding investments in oversight, training, or clear accountability structures. This is reflected across multiple sectors, from software vendors such as Grammarly, Eightfold.ai, Cohesity, and Rubrik, to business leaders and policymakers, where risk is systematically deferred downstream rather than managed at the point of adoption. The most consequential evidence is the quantitative disconnect between stated AI priorities and functional oversight. Research cited by Dave Sobel from Economist Impact and HR Dive found that while 38% of organizations budget for AI and 86% of executives rate AI as essential, only 16% offer internal training and over half of department-level AI initiatives lack formal oversight (Ernst & Young). Additionally, 88% of AI vendors limit their liability, and only 17% align with regulatory compliance, per cited surveys, leaving substantial legal and operational risk for end users and service providers. Supporting this trend, Dave Sobel points to Grammarly’s opt-out identity usage in new features and a class action lawsuit against Eightfold.ai regarding AI-driven employment decisions. Vendors such as Cohesity, Rubrik, ServiceNow, and Datadog are responding by building tools focused on remediation and recovery from AI-driven incidents, underscoring a shift from preventive governance to reactive containment. Policy moves—such as expanded operational cyber roles for the private sector—further offload accountability without addressing contractual and insurance exposure. For MSPs and technology leaders, these developments create practical risks: unclear service scope around AI tool usage in contracts, increased exposure to billable incidents and legal action, and rising labor costs for incident recovery. Service providers must audit agreements for AI-specific language, distinguish AI-related incidents from standard SLAs, and treat AI governance as a managed risk service. The pressure will increasingly fall on MSPs to account for training gaps, audit trails, compliance attestations, and recovery procedures—not simply the technology itself. Three things to know today 00:00 ROI Reality Check 02:12 Governance Gap Widens 03:14 Cleanup Economy Rises 05:45 Why Do We Care?  Supported by:  CometBackup   💼 All Our SponsorsSupport the vendors who support the show:👉 https://businessof.tech/sponsors/ 🚀 Join Business of Tech PlusGet exclusive access to investigative reports, vendor analysis, leadership briefings, and more.👉 https://businessof.tech/plus 🎧 Subscribe to the Business of TechWant the show on your favorite podcast app or prefer the written versions of each story?📲 https://www.businessof.tech/subscribe 📰 Story Links & SourcesLooking for the links from today’s stories?Every episode script — with full source links — is posted at:🌐 https://www.businessof.tech 🎙 Want to Be a Guest?Pitch your story or appear on Business of Tech: Daily 10-Minute IT Services Insights:💬 https://www.podmatch.com/hostdetailpreview/businessoftech 🔗 Follow Business of Tech LinkedIn: https://www.linkedin.com/company/28908079YouTube: https://youtube.com/mspradioBluesky: https://bsky.app/profile/businessof.techInstagram: https://www.instagram.com/mspradioTikTok: https://www.tiktok.com/@businessoftechFacebook: https://www.facebook.com/mspradionews Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

A structural shift is occurring in the managed IT services landscape as AI capabilities are rapidly embedded across enterprise applications, with oversight and risk management functions increasingly separated out and monetized as add-on services. Vendors, including Microsoft and OpenAI, are deploying AI agents in essential tools such as Outlook, Teams, and Excel, then selling governance, security, and compliance capabilities as additional paid layers. The core mechanism is the transfer of operational and liability risk downstream to IT service providers and their clients, while ownership of the control plane and margin on risk mitigation remain with the vendors. The episode highlights consequential findings regarding AI reliability and adoption. A Nature Medicine study found that OpenAI's ChatGPT Health underestimated emergency severity in 51.6% of cases, prompting concerns about overreliance on AI for critical decisions. Additionally, Confluent’s UK executive survey indicated that 62% of organizations are already shifting decision-making to AI, but only 7% have a company-wide AI strategy, and fewer than half of executives and employees agree on actual daily AI usage. Most leaders receive little formal AI training yet are second-guessing their own judgment in favor of AI output. Further reinforcing the governance gap, Microsoft is launching Agent 365 and new enterprise security tiers, while OpenAI’s acquisition of Promptfoo signals a focus on AI reliability testing and compliance monitoring. Funding for GRC platforms like IntelliGRC demonstrates capital flowing into third-party oversight solutions. The recurring pattern is vendors first pushing broad agent adoption, then introducing and monetizing governance as a discrete add-on, often outside the default package. Operationally, MSPs and IT leaders face increased liability exposure if they rely on vendor-native governance without independent audit or measurement capability. The absence of industry-standard reliability metrics for AI, combined with the perception and usage gaps inside organizations, calls for MSPs to lead in auditing, documenting, and independently measuring AI usage and performance. Failing to proactively manage these controls can result in silent risk absorption and unfavorable positioning as vendors bundle compliance and pass residual risk downstream to service providers. Three things to know today 00:00 AI vs. Judgment                            02:35 Agents vs. Oversight 04:04 AI Reliability Gap 05:15 Why Do We Care?  Supported by:  ScalePad   💼 All Our SponsorsSupport the vendors who support the show:👉 https://businessof.tech/sponsors/ 🚀 Join Business of Tech PlusGet exclusive access to investigative reports, vendor analysis, leadership briefings, and more.👉 https://businessof.tech/plus 🎧 Subscribe to the Business of TechWant the show on your favorite podcast app or prefer the written versions of each story?📲 https://www.businessof.tech/subscribe 📰 Story Links & SourcesLooking for the links from today’s stories?Every episode script — with full source links — is posted at:🌐 https://www.businessof.tech 🎙 Want to Be a Guest?Pitch your story or appear on Business of Tech: Daily 10-Minute IT Services Insights:💬 https://www.podmatch.com/hostdetailpreview/businessoftech 🔗 Follow Business of Tech LinkedIn: https://www.linkedin.com/company/28908079YouTube: https://youtube.com/mspradioBluesky: https://bsky.app/profile/businessof.techInstagram: https://www.instagram.com/mspradioTikTok: https://www.tiktok.com/@businessoftechFacebook: https://www.facebook.com/mspradionews Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

The dominant structural shift identified centers on liability allocation and governance in the context of agentic AI deployment across IT and managed services. The episode underscores how automation is moving beyond content generation to direct operational and security actions, referencing technology from OpenAI (GPT-5.3 Instant), Anthropic (Claude Marketplace), Google Workspace CLI, Microsoft’s SharePoint AI features, and Hexnode’s Genie AI. Vendors are embedding AI deeper into productivity and endpoint infrastructure, increasing both operational efficiency and the risk footprint—making governance, reliability, and accountability the new competitive differentiators. The most consequential development highlighted is the industry-wide disconnect between rapid AI remediation adoption and lagging governance. According to Omdia, 88% of organizations are using AI-driven remediation, but only 44% have implemented it for most exposure types, and nearly half (49%) of security teams lack trust in these systems. IBM data shows that 63% of organizations lack formal AI incident response policies, meaning deployment often outpaces the development of auditability and risk management. This creates a landscape where automated decisions are taken at scale without clear accountability structures or incident protocols. Supporting developments reinforce these governance and risk concerns. Reports of cognitive fatigue—termed “AI brain fry”—affecting over 14% of users (Boston Consulting Group/UC Riverside) and a 39% increase in error rates among those affected, point to compounding human and system risk when automation outpaces oversight. Market analysis from Accenture, Wharton, and the Dallas Fed notes that AI has shifted skill demand, displaced younger tech workers, and pressured traditional fixed-fee business models. Meanwhile, vendors are migrating from predictable per-seat pricing to variable token-based consumption, passing operational uncertainty onto MSPs and their clients. For MSPs, IT service providers, and technology leaders, the practical implications are clear. Failure to implement explicit governance, contract clauses, and incident protocols exposes providers to unpredictable liability. Passing through ungoverned consumption costs under fixed-contracts damages margins as AI use expands. The increasing cognitive load on staff supervising partially trusted automation further compounds operational risk. As the pricing model shifts, providers must negotiate new contract terms, institute AI incident playbooks, audit tool autonomy, and manage the blast radius of AI with the same rigor as legacy security controls. 00:00 Platform Land Grab 03:56 Who Owns Failure 07:27 Skills Over Titles 09:52 Why Do We Care?  Supported by: JumpCloud    💼 All Our SponsorsSupport the vendors who support the show:👉 https://businessof.tech/sponsors/ 🚀 Join Business of Tech PlusGet exclusive access to investigative reports, vendor analysis, leadership briefings, and more.👉 https://businessof.tech/plus 🎧 Subscribe to the Business of TechWant the show on your favorite podcast app or prefer the written versions of each story?📲 https://www.businessof.tech/subscribe 📰 Story Links & SourcesLooking for the links from today’s stories?Every episode script — with full source links — is posted at:🌐 https://www.businessof.tech 🎙 Want to Be a Guest?Pitch your story or appear on Business of Tech: Daily 10-Minute IT Services Insights:💬 https://www.podmatch.com/hostdetailpreview/businessoftech 🔗 Follow Business of Tech LinkedIn: https://www.linkedin.com/company/28908079YouTube: https://youtube.com/mspradioBluesky: https://bsky.app/profile/businessof.techInstagram: https://www.instagram.com/mspradioTikTok: https://www.tiktok.com/@businessoftechFacebook: https://www.facebook.com/mspradionews Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

The episode centers on D&H’s strategic approach to vendor selection, AI program development, and partner enablement within the evolving landscape for MSPs and IT solution providers. Colin Blair, Executive Vice President for cybersecurity at D&H, details a governance-driven process for curating vendor relationships, with emphasis on aligning with Gartner quadrant leaders, peer insight metrics, and channel-partner readiness. D&H’s focus remains on SMB and mid-market segments where complexity is increasing, especially around compliance, data governance, and cybersecurity. Supporting this curated model, Colin Blair notes that D&H maintains onboarding rigor but rarely offboards vendors within its advanced solutions group, citing ongoing hyper-growth and the need to continuously add value for partners. The vendor evaluation emphasizes data-driven benchmarks and sustained relationship-building at industry events. The company is prioritizing supply chain strength for MSPs, driven by measurable factors such as profitability, cultural compatibility, and proven channel strategies. The conversation also highlights the expansion of the Go Big AI program, which aims to increase AI literacy among both partners and end customers. Training initiatives reached over 5,000 partners, focusing on foundational applications like Microsoft Copilot and AI PCs, while acknowledging that project success is heavily dependent on data quality and governance. Use cases where implementations see traction are typically well-defined, such as Vision AI for video analytics in healthcare and security verticals. The need for tailored, consultative conversations is cited as significant, as end customers and partners often lack clarity on automation priorities or AI readiness. The implications for MSPs and IT leaders are pragmatic: sustainable advantage is less about technology adoption and more about managing operational complexity, ensuring data governance, and enhancing cybersecurity postures. Decision-makers are cautioned to assess both the maturity and applicability of AI solutions, invest in targeted literacy and consultation, and anchor their vendor relationships in measurable business value. The focus should be on careful risk management, transparent partnership evaluation, and supporting clients through consultative, outcome-driven initiatives rather than broad or speculative technology bets.  💼 All Our SponsorsSupport the vendors who support the show:👉 https://businessof.tech/sponsors/ 🚀 Join Business of Tech PlusGet exclusive access to investigative reports, vendor analysis, leadership briefings, and more.👉 https://businessof.tech/plus 🎧 Subscribe to the Business of TechWant the show on your favorite podcast app or prefer the written versions of each story?📲 https://www.businessof.tech/subscribe 📰 Story Links & SourcesLooking for the links from today’s stories?Every episode script — with full source links — is posted at:🌐 https://www.businessof.tech 🎙 Want to Be a Guest?Pitch your story or appear on Business of Tech: Daily 10-Minute IT Services Insights:💬 https://www.podmatch.com/hostdetailpreview/businessoftech 🔗 Follow Business of Tech LinkedIn: https://www.linkedin.com/company/28908079YouTube: https://youtube.com/mspradioBluesky: https://bsky.app/profile/businessof.techInstagram: https://www.instagram.com/mspradioTikTok: https://www.tiktok.com/@businessoftechFacebook: https://www.facebook.com/mspradionews Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Research presented by Dave Sobel and Anurag Agarwal highlights a steep decline in profitability for core MSP services, driven by heightened commoditization and vendor-led automation of basic offerings such as endpoint management and help desk operations. According to Techaisle’s 2026 data, the traditional labor-plus-license model is no longer sustainable, as shrinking margins force service providers to reconsider foundational strategies. The central message underscores an urgent need for MSPs to prioritize proprietary intellectual property (IP) and vertical-specific solutions—not for incremental growth, but as a matter of operational survival. Supporting this assessment, the discussion details how market demand has shifted: MSPs can no longer depend on generic solutions but must differentiate with specialized, repeatable offerings that address the financial optimization and liability concerns of business clients. The data indicates that SMBs are increasingly unwilling to invest in pilots or “all-you-can-eat” AI models without visible ROI and demand concrete solutions linked to business outcomes. Vendors and MSPs alike are being tasked with providing smaller, outcome-focused wins and developing skillsets in agentic orchestration, where AI-enabled digital agents and human technicians operate as co-equal components of the workforce. A related trend explored is the shift toward agentic AI and “zero-touch” MSP models, featuring automation of routine IT tasks and focus on workflow engineering rather than manual services. However, the episode notes that most providers are unprepared for the new set of risks and governance liabilities: as clients increasingly utilize AI agents, accountability for errors and regulatory compliance will rest heavily with MSPs, especially in sensitive geographies such as Europe where contractual governance is becoming standard. Conversations on whether to “build or buy” new capabilities reflect a split market, with only the top tier capable of meaningful in-house development, and the majority relying on third-party platforms with limited differentiation. For MSPs, IT service firms, and decision-makers, the core implication is the need to rapidly develop operational and governance maturity around automation, AI orchestration, and packaged offerings. Clinging to traditional models or treating AI as a mere add-on introduces significant risk, including shrinking margins, increased liability, and potential obsolescence. Providers are advised to narrow focus, specialize in vertical solutions, invest in internal competency with AI-enabled platforms, and shift toward packaged IP to avoid falling behind as both client expectations and regulatory requirements escalate.  💼 All Our SponsorsSupport the vendors who support the show:👉 https://businessof.tech/sponsors/ 🚀 Join Business of Tech PlusGet exclusive access to investigative reports, vendor analysis, leadership briefings, and more.👉 https://businessof.tech/plus 🎧 Subscribe to the Business of TechWant the show on your favorite podcast app or prefer the written versions of each story?📲 https://www.businessof.tech/subscribe 📰 Story Links & SourcesLooking for the links from today’s stories?Every episode script — with full source links — is posted at:🌐 https://www.businessof.tech 🎙 Want to Be a Guest?Pitch your story or appear on Business of Tech: Daily 10-Minute IT Services Insights:💬 https://www.podmatch.com/hostdetailpreview/businessoftech 🔗 Follow Business of Tech LinkedIn: https://www.linkedin.com/company/28908079YouTube: https://youtube.com/mspradioBluesky: https://bsky.app/profile/businessof.techInstagram: https://www.instagram.com/mspradioTikTok: https://www.tiktok.com/@businessoftechFacebook: https://www.facebook.com/mspradionews Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Correction (March 8, 2026): MSP Well stated that while a Discord server exists, it is currently configured as a “coming soon”/waitlist environment with posting disabled and no peer discussion channels open yet. MSP Well also stated its privacy policy has been publicly available since launch.   The episode centers on a structural governance gap within the managed services industry as it attempts to address mental health using relationship-driven models typical of event and community management. This approach is exemplified by the launch of MSPWell, a not-for-profit mental wellness initiative incorporated in Ontario, Canada, targeting participants in the IT channel. The initiative operates as a live community—particularly via Discord—without formalized clinical oversight or published operational guardrails such as moderation standards, crisis escalation protocols, or sponsor influence controls. Evidence for an urgent governance concern is provided by industry data and operational decisions. According to MSPWell, burnout affects significant percentages of the workforce—citing an 82% burnout risk from a Mercer report and 66% from separate research. Despite the recurrence of staffing challenges in the MSP industry, MSPWell’s infrastructure is underway with participation at industry events and vendor sponsorship, but formal governance documentation remains incomplete. The initiative explicitly confirms the absence of licensed mental health professionals in published leadership or advisory roles, positioning its support as peer-led. Supporting developments highlight how rapid community launch and sponsor-driven funding amplify risks when core protections are missing. Early coverage focused on recognizable names and event presence, while Dave Sobel emphasizes that, in mental health-adjacent contexts, moderation, privacy, and escalation protocols are not only differentiators but essential safeguards. At present, MSPWell’s Discord community operates without visible guidelines or documented procedures, which exposes participants to predictable failure modes such as oversharing, privacy breaches, and harmful peer advice. Operationally, MSPs and IT service providers face heightened liability when participating in or supporting such initiatives without robust controls. Dave Sobel advises operators to request moderation, crisis, and data retention policies before endorsing participation, to treat involvement as networking rather than clinical support, and to monitor for the integration of licensed professionals into governance. The absence of enforceable governance exposes both individuals and sponsoring vendors to reputational and legal risk, and sets problematic precedent for future wellness platforms in the industry. 00:00 MSPWell Builds Mental-Health Platform on Sponsor-Funded Community Model 03:21 Guardrails, Guidelines, and Moderation  06:15 The Consequences 08:09 Why Do We Care? & What to Consider Supported by:  TimeZest     💼 All Our SponsorsSupport the vendors who support the show:👉 https://businessof.tech/sponsors/ 🚀 Join Business of Tech PlusGet exclusive access to investigative reports, vendor analysis, leadership briefings, and more.👉 https://businessof.tech/plus 🎧 Subscribe to the Business of TechWant the show on your favorite podcast app or prefer the written versions of each story?📲 https://www.businessof.tech/subscribe 📰 Story Links & SourcesLooking for the links from today’s stories?Every episode script — with full source links — is posted at:🌐 https://www.businessof.tech 🎙 Want to Be a Guest?Pitch your story or appear on Business of Tech: Daily 10-Minute IT Services Insights:💬 https://www.podmatch.com/hostdetailpreview/businessoftech 🔗 Follow Business of Tech LinkedIn: https://www.linkedin.com/company/28908079YouTube: https://youtube.com/mspradioBluesky: https://bsky.app/profile/businessof.techInstagram: https://www.instagram.com/mspradioTikTok: https://www.tiktok.com/@businessoftechFacebook: https://www.facebook.com/mspradionews Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Market segmentation driven by rising memory costs is actively restructuring the endpoint device landscape, leading to margin redistribution across the technology stack. Apple exemplified this bifurcation strategy by launching an entry-level MacBook Neo at $599 built on the A18 Pro iPhone chip, while simultaneously increasing prices on other MacBook Air and Pro models by $100 to $400 in response to global memory shortages. This deliberate move separates high-margin premium hardware from low-cost devices, effectively diminishing the traditional mid-tier device segment where most SMB and MSP standards have typically been positioned. Supporting data highlights the broader industry impact: 62% of small businesses report ongoing supply chain disruption, affecting pricing, timing, and availability, according to recent NFIB survey data. Component suppliers such as Broadcom are capturing upstream value, with a reported 29% year-over-year revenue increase driven by concentrated AI infrastructure demand. Omnia’s forecast anticipates a significant smartphone shipment decline in 2026, primarily attributed to rising memory costs and uneven impact, disproportionately squeezing entry-level devices while preserving premium margins. A parallel challenge emerges within organizational governance and service delivery. The Logicalis Global CIO Report 2026 found over half of CIOs believe AI adoption is outpacing their management capabilities, with 90% of organizations lacking internal technical expertise yet 72% planning further AI investment. This gap between ambition and readiness, combined with traditional ticket-based operating models, means unmanaged risk increases as businesses prioritize speed over structured governance. Internal IT builds are increasingly abandoned, with 71% of IT and security leaders reporting failure to meet on-time and budget targets, signaling that velocity and accountability, not just ticket closure, are becoming core client expectations. Implications for MSPs and IT service providers are immediate and operational. Service models must account for hardware segmentation by incorporating differentiated support structures for entry-level versus premium devices. Increased complexity and support demands from constrained hardware will compress margins unless properly priced and standardized. MSPs are positioned closest to liability accumulation as clients face both hardware refresh and AI adoption without sufficient internal expertise. Advisory frameworks should address total cost of ownership, memory shortage context, and governance gaps, productizing assessments and redesigning service delivery for speed with explicit controls to manage risk. Three things to know today 00:00 Memory Costs Squeeze Entry-Level Hardware as Suppliers Capture Margin Upstream 02:24 Apple's $599 MacBook Neo Signals a Split Hardware Strategy, Not a Budget Play 04:22 IT Service Models Built on Approvals Are Losing to Speed-First Competitors 06:57 Why Do We Care?  Supported by:  💼 All Our SponsorsSupport the vendors who support the show:👉 https://businessof.tech/sponsors/ 🚀 Join Business of Tech PlusGet exclusive access to investigative reports, vendor analysis, leadership briefings, and more.👉 https://businessof.tech/plus 🎧 Subscribe to the Business of TechWant the show on your favorite podcast app or prefer the written versions of each story?📲 https://www.businessof.tech/subscribe 📰 Story Links & SourcesLooking for the links from today’s stories?Every episode script — with full source links — is posted at:🌐 https://www.businessof.tech 🎙 Want to Be a Guest?Pitch your story or appear on Business of Tech: Daily 10-Minute IT Services Insights:💬 https://www.podmatch.com/hostdetailpreview/businessoftech 🔗 Follow Business of Tech LinkedIn: https://www.linkedin.com/company/28908079YouTube: https://youtube.com/mspradioBluesky: https://bsky.app/profile/businessof.techInstagram: https://www.instagram.com/mspradioTikTok: https://www.tiktok.com/@businessoftechFacebook: https://www.facebook.com/mspradionews Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

The MSP market is undergoing a critical shift toward risk management as the central value proposition, with operational accountability now defined by the ability to produce defensible documentation and deliver rapid incident response. According to Dave Sobel, MSPs are no longer primarily offering stack management, but are increasingly brokering risk through cyber warranties, insurance underwriting, incident retainers, and AI governance frameworks. Those unable to support their claims with evidence and formal processes risk becoming mere facilitators for third-party terms and losing control over their margins. Recent developments reinforce this shift. A Splunk report finds that nearly all CISOs now view AI governance and risk management as their responsibility, citing threat actor sophistication as a primary driver. AI is assisting with event triage and data correlation, but verification—especially around AI-generated content—is unreliable, with detection tools struggling against advanced fakes. Insurance mechanisms are becoming productized with prioritized incident response, and legal intelligence is being embedded into MSP workflows. Vendors like N-able, Monjur, SentinelOne, and DocuSign are directly integrating financial, legal, and governance functions into their offerings, fundamentally altering client and vendor relationships. Adjacent stories illustrate volatility in traditional safeguards and the operational reality of adaptive threats. CISA leadership changes indicate instability in public response institutions. AI-powered malware exemplifies the challenge: ESET’s PromptSpy uses Gemini to continuously adapt its persistence, outpacing static detection models. Insurance underwriters are increasingly demanding machine-verifiable evidence of controls, using detailed questionnaires to distinguish autonomous AI from marketing claims. The risk is no longer just technical; it is structural. For MSPs and IT leaders, operational posture is now shaped by an ecosystem of embedded warranties, legal terms, governance requirements, and adaptive threats. The ability to document, defend, and productize risk controls becomes a baseline for credibility and insurance eligibility. Failure to build evidence pipelines and clarify vendor-imposed liabilities exposes service providers to compounded risk. The practical implication is a necessity for MSPs to treat governance and detection as measurable, documented capabilities—not assumptions or routine paperwork. Three things to know today: 00:00 CISOs Own Governance, Detectors Lag Fakes, Response Gets Contracted — Accountability Follows 03:14 N-able, SentinelOne, DocuSign Move Risk Management Into the Stack — MSP Terms Follow 05:10 CISOs Want Agentic AI, But Insurers and Adaptive Malware Are Forcing the Timeline 07:32 Why Do We Care?  Supported by:  CometBackUpSmall Biz Thoughts Community  💼 All Our SponsorsSupport the vendors who support the show:👉 https://businessof.tech/sponsors/ 🚀 Join Business of Tech PlusGet exclusive access to investigative reports, vendor analysis, leadership briefings, and more.👉 https://businessof.tech/plus 🎧 Subscribe to the Business of TechWant the show on your favorite podcast app or prefer the written versions of each story?📲 https://www.businessof.tech/subscribe 📰 Story Links & SourcesLooking for the links from today’s stories?Every episode script — with full source links — is posted at:🌐 https://www.businessof.tech 🎙 Want to Be a Guest?Pitch your story or appear on Business of Tech: Daily 10-Minute IT Services Insights:💬 https://www.podmatch.com/hostdetailpreview/businessoftech 🔗 Follow Business of Tech LinkedIn: https://www.linkedin.com/company/28908079YouTube: https://youtube.com/mspradioBluesky: https://bsky.app/profile/businessof.techInstagram: https://www.instagram.com/mspradioTikTok: https://www.tiktok.com/@businessoftechFacebook: https://www.facebook.com/mspradionews Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

The episode centers on the federal government's evolving approach to AI vendor governance, underscored by the recent directive from President Donald Trump for federal agencies to halt the use of Anthropic’s AI technology. This shift follows the Pentagon’s termination of its relationship with Anthropic over the company’s refusal to relax contract restrictions around citizen data and autonomous weapons, ultimately resulting in Anthropic being designated as a “supply chain risk” by Defense Secretary Pete Hegseth. For MSPs and IT providers serving federal and SLED clients, this designation functions as an immediate procurement barrier rather than a negotiable label, directly impacting vendor eligibility and contract continuity. Contextually, 70% of federal agencies are reassessing their use of AI tools amid fluid regulations and heightened concerns around transparency and accountability, according to recent reports. The National Institute of Standards and Technology (NIST) has launched the AI Agent Standards Initiative, but enforcement is several years away, with only a request for information planned by March 2026. In parallel, a diplomatic initiative led by Secretary of State Marco Rubio opposes international regulations on foreign data handling, though this stance does not supersede foreign law, creating a complex compliance landscape, especially for multinationals. Meanwhile, the U.S. Supreme Court’s refusal to hear an AI copyright case reaffirms the lack of copyright protection for purely AI-generated works. The episode also discusses OpenAI’s agreement with the Pentagon, described by CEO Sam Altman as "rushed," and criticized for permitting domestic surveillance under flexible legal interpretations. Public and employee backlash prompted OpenAI to revise contract terms, but critics argue essential permission structures remain. Anthropic’s rollout of an AI migration feature during this period is flagged as a compliance event, raising risk when transferring data histories across vendor boundaries without audit or logging. Notably, consumer responses to AI vendor practices—evidenced by surges in Claude signups and ChatGPT uninstalls—are now influencing enterprise technology procurement as values-based purchasing enters the operational conversation for service providers. Operationally, the lack of a stable legislative or regulatory framework means MSPs and their clients face rapidly shifting governance through contract terms and procurement policy rather than law. The episode cautions that vendor selection cannot be guided by assumptions of ethical safeguards in provider policies or by default transitions to alternative vendors such as OpenAI, whose legal standing remains unsettled. Key recommendations include auditing client environments for exposure to designated supply chain risks, refraining from rigid vendor integrations, updating contractual IP language in light of the absence of AI copyright, and maintaining ongoing awareness of governance developments. Multi-vendor strategies and adaptable compliance positions are identified as essential risk mitigation practices in an environment marked by administrative fiat and reactive vendor positions. Three things to know today 00:00 Anthropic Blacklisted After Rejecting Pentagon's Autonomous Weapons Data Demands 04:58 OpenAI Wins Federal AI Contract Anthropic Refused, Then Rewrites It Under Pressure 07:38 Anthropic Outages Hit as Claude Sign-Ups Quadruple, ChatGPT Uninstalls Surge 295% Supported by: ScalePadSmall Biz Thoughts Community    💼 All Our SponsorsSupport the vendors who support the show:👉 https://businessof.tech/sponsors/ 🚀 Join Business of Tech PlusGet exclusive access to investigative reports, vendor analysis, leadership briefings, and more.👉 https://businessof.tech/plus 🎧 Subscribe to the Business of TechWant the show on your favorite podcast app or prefer the written versions of each story?📲 https://www.businessof.tech/subscribe 📰 Story Links & SourcesLooking for the links from today’s stories?Every episode script — with full source links — is posted at:🌐 https://www.businessof.tech 🎙 Want to Be a Guest?Pitch your story or appear on Business of Tech: Daily 10-Minute IT Services Insights:💬 https://www.podmatch.com/hostdetailpreview/businessoftech 🔗 Follow Business of Tech LinkedIn: https://www.linkedin.com/company/28908079YouTube: https://youtube.com/mspradioBluesky: https://bsky.app/profile/businessof.techInstagram: https://www.instagram.com/mspradioTikTok: https://www.tiktok.com/@businessoftechFacebook: https://www.facebook.com/mspradionews Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Enterprise IT spending is projected to reach $4.5 trillion by 2026, but this growth is concentrated in software, cloud services, and AI infrastructure for large organizations, according to HG Insights and Omdia research cited by Dave Sobel. The system integration market is positioned to approach $950 billion in 2025, with enterprises working with an average of 6.3 technology partners. A substantial surge in AI-optimized server sales, as reflected in Dell Technologies’ reported 342% year-over-year increase in revenue for those systems, is reshaping supply chains and vendor dynamics, leading to shortages of DRAM, SSDs, and hard drives. Underlying this development are volatile component costs. DRAM prices have doubled quarter over quarter, and both Micron Technologies and Western Digital have indicated they are sold out for 2026. HP reports that RAM now constitutes 35% of new PC materials costs, up dramatically from 18% the previous quarter. Such cost shifts are creating downstream risks for managed service providers (MSPs) with fixed-price agreements, as the economic assumptions underpinning many contracts—stable hardware prices and predictable cloud costs—no longer hold. The episode also highlights an increase in application sprawl and a widening gap between IT budgets and other operational costs. A Torii report shows large enterprises use over 2,191 applications on average, with more than 61% bypassing formal IT approvals, resulting in unmanaged security and compliance exposure. Additionally, 80% of small businesses report rising energy costs that directly compete with IT budget allocations. Industry analysis from Jefferies and Boston Consulting Group signals that AI and automation are not viewed uniformly as productivity boosters and may compress revenue models in both Indian and domestic IT services sectors. The practical implication for MSPs is the urgent need to audit and reprice contracts related to hardware procurement and refresh cycles, clearly documenting and communicating current cost realities with clients. Dave Sobel stresses reframing device lifecycle extensions as a security risk rather than a cost-saving measure and warns against selling clients on speculative AI market projections. The advice is to focus on specific, scoped use cases and to structure agreements that accurately reflect volatility in component costs and the operational burden of application sprawl, ensuring financial and legal accountability as the IT services landscape evolves. 00:00 $4.96T IT Spend Surge Bypasses SMBs as AI Infrastructure Captures Enterprise Budgets 03:58 Dell's $43B AI Server Backlog Triggers DRAM Shortage, Repricing Downstream Hardware 05:52 AI Shrinks IT Services Revenue Model; MSPs Face Contested Implementation Role   This is the Business of Tech.    Supported by:  💼 All Our SponsorsSupport the vendors who support the show:👉 https://businessof.tech/sponsors/ 🚀 Join Business of Tech PlusGet exclusive access to investigative reports, vendor analysis, leadership briefings, and more.👉 https://businessof.tech/plus 🎧 Subscribe to the Business of TechWant the show on your favorite podcast app or prefer the written versions of each story?📲 https://www.businessof.tech/subscribe 📰 Story Links & SourcesLooking for the links from today’s stories?Every episode script — with full source links — is posted at:🌐 https://www.businessof.tech 🎙 Want to Be a Guest?Pitch your story or appear on Business of Tech: Daily 10-Minute IT Services Insights:💬 https://www.podmatch.com/hostdetailpreview/businessoftech 🔗 Follow Business of Tech LinkedIn: https://www.linkedin.com/company/28908079YouTube: https://youtube.com/mspradioBluesky: https://bsky.app/profile/businessof.techInstagram: https://www.instagram.com/mspradioTikTok: https://www.tiktok.com/@businessoftechFacebook: https://www.facebook.com/mspradionews Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

The episode centers on the evolving responsibility and risk allocation within cybersecurity distribution, with particular focus on Exclusive Networks’ approach. Jason Beal, as president of Exclusive Networks North America, outlines their emphasis on a technical workforce, maintaining a 1:3 ratio of engineers to sales representatives. This structure is positioned to address the increasing complexity of cybersecurity and the demands faced by service provider partners, aiming to support solution integration and customer needs while clarifying each party’s liability. Supporting this structure, Jason Beal identifies the role of the distributor as both an extension and enabler for MSPs and IT services companies. Distributors are expected to supplement partners’ capabilities—whether technical, financial, or operational—without assuming technology failure risk, which remains with the original technology vendors. Discussion of shared responsibility models also distinguishes between sales success (customer adoption, retention) and risk management. Recent developments in cyber insurance are cited as having reduced the direct risk burden on MSPs, shifting much of the liability away from service providers toward technology creators, albeit within contractually defined limits. Adjacent to cybersecurity, the conversation addresses skill and adoption gaps prompted by rapid technical innovation, specifically referencing artificial intelligence (AI). Jason Beal quantifies educational efforts by highlighting a collaboration with Cal Poly San Luis Obispo, which has seen 100 students engaged to help address workforce shortfalls in cybersecurity and AI. Additionally, academic experience informs the importance of modernizing IT operations curricula to better reflect current business challenges, such as cloud, AI, and global supply chain impacts. For MSPs and IT service providers, implications include the growing necessity to audit core competencies and allocate resources strategically, leveraging distributors not just for sourcing products but for specialized expertise, integration, and operational support. Risk mitigation remains tied to understanding contract language, vendor accountability, and developments in cyber insurance. The pace of AI and other technology adoption requires continuous education and careful evaluation of both operational risk and the practical limitations of solutions promoted by the channel and distribution partners.  💼 All Our SponsorsSupport the vendors who support the show:👉 https://businessof.tech/sponsors/ 🚀 Join Business of Tech PlusGet exclusive access to investigative reports, vendor analysis, leadership briefings, and more.👉 https://businessof.tech/plus 🎧 Subscribe to the Business of TechWant the show on your favorite podcast app or prefer the written versions of each story?📲 https://www.businessof.tech/subscribe 📰 Story Links & SourcesLooking for the links from today’s stories?Every episode script — with full source links — is posted at:🌐 https://www.businessof.tech 🎙 Want to Be a Guest?Pitch your story or appear on Business of Tech: Daily 10-Minute IT Services Insights:💬 https://www.podmatch.com/hostdetailpreview/businessoftech 🔗 Follow Business of Tech LinkedIn: https://www.linkedin.com/company/28908079YouTube: https://youtube.com/mspradioBluesky: https://bsky.app/profile/businessof.techInstagram: https://www.instagram.com/mspradioTikTok: https://www.tiktok.com/@businessoftechFacebook: https://www.facebook.com/mspradionews Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Anthropic’s refusal to remove safeguards against mass domestic surveillance and fully autonomous weapons in its interactions with the Department of Defense establishes an explicit boundary on the use of AI in federal contracts. The company cited specific civic and legal risks, emphasizing that current AI systems are not reliable enough for autonomous weapon deployment and warning that government pressure on vendors to bypass statutory constraints poses broader accountability issues. This underscores a shift in liability for MSPs and IT providers—any weakening of safeguards under contract does not eliminate risk but instead transfers possible exposure down the technology supply chain. This position is reinforced by the lack of unconditional trust in military oversight, as highlighted by the Pentagon CTO’s remarks, and by clear legal challenges, including violations of the Fourth Amendment and Department of Defense Directive 3000.09. Dave Sobel asserts that professional liability and cyber policies do not typically cover actions undertaken solely at government request where legal limits are breached. This increases the necessity for MSPs and IT leaders to verify that contract language explicitly defines acceptable AI use and to ensure written documentation before government or enterprise client demands arise. Additional analysis includes operational deployments of AI in service and workplace environments. Burger King’s AI chatbot, Patty, and ServiceNow’s autonomous request resolution underscore the friction between efficiency claims and trust gaps, as evidenced by a YouGov survey that found 68% of consumers lack confidence in AI customer service. Dave Sobel notes that MSP benchmarks tied to vendor ticket closure rates may not reflect real client satisfaction or risk, especially when legal requirements for monitoring and consent are not met. The episode further covers market reactions to speculative reports on AI-driven job displacement, studies demonstrating AI’s failure to maintain human-like restraint in conflict scenarios, and IBM’s valuation drop due to AI modernization tools. For MSPs and IT decision-makers, the practical takeaway is the need for documented governance, explicit contractual safeguards, and ongoing risk assessments when deploying or recommending AI solutions—particularly in environments where trust, human oversight, and insurability are not yet aligned with technical capability. Three things to know today: 00:00 Anthropic Refuses Pentagon Demands on Surveillance and Autonomous Weapons, Risks Contract 03:40 AI Hits the Human Layer — and Governance, Consent, and Trust Infrastructure Aren't Ready 07:37 AI Moves Markets, Escalates Wars, and Splits Partner Ecosystems — In One Week   This is the Business of Tech.    Supported by:  IT Service Provider University  💼 All Our SponsorsSupport the vendors who support the show:👉 https://businessof.tech/sponsors/ 🚀 Join Business of Tech PlusGet exclusive access to investigative reports, vendor analysis, leadership briefings, and more.👉 https://businessof.tech/plus 🎧 Subscribe to the Business of TechWant the show on your favorite podcast app or prefer the written versions of each story?📲 https://www.businessof.tech/subscribe 📰 Story Links & SourcesLooking for the links from today’s stories?Every episode script — with full source links — is posted at:🌐 https://www.businessof.tech 🎙 Want to Be a Guest?Pitch your story or appear on Business of Tech: Daily 10-Minute IT Services Insights:💬 https://www.podmatch.com/hostdetailpreview/businessoftech 🔗 Follow Business of Tech LinkedIn: https://www.linkedin.com/company/28908079YouTube: https://youtube.com/mspradioBluesky: https://bsky.app/profile/businessof.techInstagram: https://www.instagram.com/mspradioTikTok: https://www.tiktok.com/@businessoftechFacebook: https://www.facebook.com/mspradionews Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

The episode’s central development is the ongoing dispute between the U.S. Department of Defense and Anthropic regarding Pentagon demands for unrestricted access to Claude, Anthropic’s AI model. According to Dave Sobel, the Pentagon has threatened to sever ties or invoke the Defense Production Act if the company does not comply, seeking capabilities that Anthropic argues may be illegal—specifically mass surveillance without warrants and autonomous weapons systems without human control. This move exposes Managed Service Providers (MSPs) serving defense contractors to unpredictable legal, operational, and compliance risks embedded in their AI workflows. The analysis highlights that a commercial AI provider’s acceptable use policy now intersects directly with national security policy, and even partial vendor compliance can trigger regulatory or legal instability for dependent organizations. For MSPs, this means that building service offerings on AI infrastructures without clear fallback strategies or documented policy change clauses can lead to unmanageable risk and liability in the event of provider or legal regime shifts. Dave Sobel stresses that failing to address policy volatility as part of a managed service amounts to underwriting geopolitical risk without compensation. Other notable developments include the passage of the Small Business Artificial Intelligence Advancement Act, federal cybersecurity resource contraction as CISA operates with 38% staffing after layoffs, and heightened uncertainty around cloud infrastructure due to Microsoft’s Azure Local “air-gapped” offering not wholly mitigating U.S. CLOUD Act exposure. Vendor news covered new AI-powered compliance features from Compliance Scorecard (version 10) and Beachhead Solutions (ComplianceEZ 2.0), Apple’s accelerated retirement of Rosetta 2 translation technology, a Microsoft 365 Copilot DLP change, and continued fallout from VMware’s acquisition by Broadcom, which has led to ongoing cost and trust challenges for cloud and infrastructure partners. The episode’s clear implications for MSPs and IT providers are operational. Service catalogs and statements of work should actively address AI provider liability, dependency exit planning, and degraded federal cybersecurity support. Without scheduled and documented compatibility and risk reviews, MSPs absorb hidden exposure into their margins. Vendor stability can no longer be assumed, and proactive policy, renewal intelligence, and transparent advisory sessions are now required to avoid unplanned liability, budget crises, and damaged client trust. Four things to know today 00:00 Pentagon Threatens Anthropic Over Claude Access, Demands Autonomous Weapons Use 04:31 CISA Cuts, Azure Sovereignty Push Signal End of Federal MSP Safety Net 06:56 AI Compliance Tools Flood Market as MSPs Face Validation Gap 09:54 86% of Firms Cutting VMware Ties as Broadcom Renewal Costs Loom   This is the Business of Tech.    Supported by: Small Biz Thoughts Community  💼 All Our SponsorsSupport the vendors who support the show:👉 https://businessof.tech/sponsors/ 🚀 Join Business of Tech PlusGet exclusive access to investigative reports, vendor analysis, leadership briefings, and more.👉 https://businessof.tech/plus 🎧 Subscribe to the Business of TechWant the show on your favorite podcast app or prefer the written versions of each story?📲 https://www.businessof.tech/subscribe 📰 Story Links & SourcesLooking for the links from today’s stories?Every episode script — with full source links — is posted at:🌐 https://www.businessof.tech 🎙 Want to Be a Guest?Pitch your story or appear on Business of Tech: Daily 10-Minute IT Services Insights:💬 https://www.podmatch.com/hostdetailpreview/businessoftech 🔗 Follow Business of Tech LinkedIn: https://www.linkedin.com/company/28908079YouTube: https://youtube.com/mspradioBluesky: https://bsky.app/profile/businessof.techInstagram: https://www.instagram.com/mspradioTikTok: https://www.tiktok.com/@businessoftechFacebook: https://www.facebook.com/mspradionews Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Recent analysis from Goldman Sachs indicates that $700 billion in AI investment during 2025 resulted in no measurable U.S. GDP growth, with most AI equipment imports negating domestic benefits and 80% of surveyed firms reporting no productivity or employment improvements. This pattern suggests that AI-related spending has primarily shifted margins from enterprise IT budgets to a small number of infrastructure vendors rather than delivering distributed value. Internal concerns are rising, with 90% of IT leaders questioning AI’s return on investment, and 80% citing fragmented data as a primary challenge to measuring outcomes. Further context reveals that agentic AI initiatives face operational headwinds: Gartner expects 40% of such projects to be cancelled by 2027, and S&P Global found nearly half are abandoned before production, most often due to inadequate planning and data foundations. Margin erosion is widespread, attributed to AI implementation costs, and attempts to scale AI agents into production remain limited by inference costs and insufficient infrastructure. Despite increased adoption efforts, sustainable value delivery from AI platforms remains elusive for most organizations. Enterprise AI access is becoming increasingly concentrated. OpenAI’s partnership with consulting firms such as BCG, McKinsey, Accenture, and Capgemini consolidates control of the enterprise distribution layer, narrowing competitive opportunities for smaller providers. Meanwhile, Amazon’s 13-hour AWS outage, linked to the misconfiguration of an internal AI tool, underscores the liability ambiguity in agentic systems—where vendors may attribute autonomous actions to user error, complicating risk assignment. Additional updates from vendors such as Anthropic, Cloudflare, and New Relic address incremental technical capabilities, with a distinct focus on cost, operational governance, and policy enforcement. The prevailing themes for MSPs and IT leaders are increased scrutiny of AI value, heightened exposure to cost and accountability risk, and the emergence of managed service opportunities around data governance, cost instrumentation, and liability management. With enterprise market channels consolidating and risk shifting toward service providers, integrating robust contractual definitions for autonomy, incident attribution, and financial boundaries is essential to limit harm and clarify responsibility before incidents occur. Four things to know today 00:00 Goldman: $700B AI Spend Delivered Near-Zero U.S. GDP Growth in 2025 03:49 OpenAI Enlists BCG, McKinsey, Accenture to Distribute Enterprise AI Agents 06:44 Report: Amazon's Own Engineers Prefer Claude Over Its Mandated Internal Tools 08:56 AI Inference Costs Are Falling — But Governance Gaps Are Growing This is the Business of Tech.    Supported by: CometBackup  Small Biz Thoughts Community     💼 All Our SponsorsSupport the vendors who support the show:👉 https://businessof.tech/sponsors/ 🚀 Join Business of Tech PlusGet exclusive access to investigative reports, vendor analysis, leadership briefings, and more.👉 https://businessof.tech/plus 🎧 Subscribe to the Business of TechWant the show on your favorite podcast app or prefer the written versions of each story?📲 https://www.businessof.tech/subscribe 📰 Story Links & SourcesLooking for the links from today’s stories?Every episode script — with full source links — is posted at:🌐 https://www.businessof.tech 🎙 Want to Be a Guest?Pitch your story or appear on Business of Tech: Daily 10-Minute IT Services Insights:💬 https://www.podmatch.com/hostdetailpreview/businessoftech 🔗 Follow Business of Tech LinkedIn: https://www.linkedin.com/company/28908079YouTube: https://youtube.com/mspradioBluesky: https://bsky.app/profile/businessof.techInstagram: https://www.instagram.com/mspradioTikTok: https://www.tiktok.com/@businessoftechFacebook: https://www.facebook.com/mspradionews Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Cybercrime’s escalation has reached a projected $12.2 trillion annual impact by 2031, with a notable surge in remote monitoring and management (RMM) tool abuse—up 277% year-over-year, according to Huntress and supporting vendor reports. Attackers utilize legitimate IT tools to facilitate stealthier ransomware and phishing campaigns, amplifying structural vulnerabilities within MSP technology stacks. Key metrics from Acronis, WatchGuard, and Vectra AI indicate a shift to smaller, more evasive malware campaigns, longer times to ransomware deployment (averaging 20 hours), and widespread unaddressed security alerts, raising questions about the adequacy of current defenses and incident response practices. Vendor-supplied threat intelligence further shows that MSPs’ reliance on signature-based platforms and insufficient visibility leaves them exposed to evolving attack techniques. Data reviewed suggests phishing footholds can quickly compromise cross-client environments, and legal ramifications heavily fall on the service provider when RMM or monitoring tools act as entry points. Notably, only about 58-60% of organizations report full visibility across their systems, with a majority of alerts remaining unaddressed, underscoring gaps in operational maturity and preparedness. Adjacent coverage highlighted Microsoft Copilot’s repeated security control failures within regulated environments, specifically its inability to enforce sensitivity labels and boundaries across emails—most recently affecting the UK’s National Health Service. The lack of vendor-announced architectural changes calls into question the viability of deploying AI tools in compliance-driven contexts. Separately, political and public backlash against surveillance technologies (such as Flock cameras) demonstrates that unchecked data collection is no longer a manageable passive risk, as data becomes increasingly actionable and retains liability beyond technical considerations. The practical takeaway for MSPs and IT leaders is a need to prioritize audit, documentation, and enforcement of controls within their technology stacks, especially where vendor tools or AI-driven automation intersect with compliance and client trust. Preserving operational optionality and scrutinizing vendor terms—particularly data sharing and architectural enforcement—are essential to reduce exposure. Waiting for vendor patches, disregarding documented control failures, or underestimating public scrutiny elevate liability across legal, reputational, and client relationship domains. Four things to know today: 00:00 Vendor Threat Reports Converge on One Risk MSPs Can't Outsource: The RMM as Breach Vector 05:11 Copilot Failed Compliance Controls Twice in Eight Months — A Patch Won't Fix That 07:03 Flock Backlash Exposes the Liability Hidden in Every Vendor Data-Sharing Contract 09:42 GTDC Summit: Distributors Pitch AI On-Ramp as Hyperscalers Compress Their Margin Sponsored by:    💼 All Our SponsorsSupport the vendors who support the show:👉 https://businessof.tech/sponsors/ 🚀 Join Business of Tech PlusGet exclusive access to investigative reports, vendor analysis, leadership briefings, and more.👉 https://businessof.tech/plus 🎧 Subscribe to the Business of TechWant the show on your favorite podcast app or prefer the written versions of each story?📲 https://www.businessof.tech/subscribe 📰 Story Links & SourcesLooking for the links from today’s stories?Every episode script — with full source links — is posted at:🌐 https://www.businessof.tech 🎙 Want to Be a Guest?Pitch your story or appear on Business of Tech: Daily 10-Minute IT Services Insights:💬 https://www.podmatch.com/hostdetailpreview/businessoftech 🔗 Follow Business of Tech LinkedIn: https://www.linkedin.com/company/28908079YouTube: https://youtube.com/mspradioBluesky: https://bsky.app/profile/businessof.techInstagram: https://www.instagram.com/mspradioTikTok: https://www.tiktok.com/@businessoftechFacebook: https://www.facebook.com/mspradionews Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Recent data highlights a growing disconnect between technology spending and measurable business outcomes, with small business optimism softening and widespread skepticism about the benefits of artificial intelligence. The transcript cites an 80% rate of firms seeing no noticeable AI-driven productivity improvements, while trust in technology companies, particularly AI vendors, has declined globally according to the Edelman report. For MSPs, this presents a risk of credibility gaps, especially for those selling AI solutions without corresponding outcome data, as client trust and spending habits grow more discerning in the face of unfulfilled promises. Further context is provided by economic indicators showing a resilient U.S. economy, yet persistent challenges for small businesses. The NFIB Small Business Optimism Index has dropped slightly to 99.3, with insurance costs and labor quality as major pain points; only 16% of business owners expect higher sales. At the same time, IT professionals face salary compression—median IT salaries fell from $145,000 in 2023 to $115,000 in 2024—despite a severe shortage of skilled cloud, AI, and infrastructure talent, as less than 10% of hiring managers are confident in filling in-demand roles. Additional market pressures include rising technology budgets—three-quarters of CFOs anticipate larger tech allocations, but headcount increases are slowing and tech spending faces a widening affordability gap due to sector-specific inflation outpacing budget growth. Vendor-specific developments, such as Western Digital exhausting hard drive capacity for 2026 and Enable reporting 12.8% revenue growth alongside ongoing losses and a 65% stock decline since 2021, illustrate structural risks. Vendor rationalization and strategic uncertainty are likely outcomes for MSPs relying heavily on underperforming partners. Key takeaways for service providers and IT leaders include the need for caution in messaging and solution positioning: outcome data and defensible value propositions are essential when advocating AI or cloud services. Salary data should be weighed against demand-side evidence to avoid retention failures. Finally, dependency on vendors with deteriorating financial outlooks heightens operational risk; providers should proactively assess alternatives and align with financially sustainable partners to reduce exposure during vendor consolidation cycles or market restructures. Four things to know today 00:00 AI Productivity Gap Widens as Trust Drops — MSPs Selling Outcomes They Can't Measure Face CFO Audits  04:51 IT Median Salary Dropped 20% in 2024, But Only 7% of Hiring Managers Can Fill AI and Cloud Roles 07:26 IT Inflation Hits 6.9% as CFOs Concentrate Spend; Western Digital Fully Booked Through 2026 10:28 N-Able Beats Revenue, Misses Earnings as 2026 Growth Guidance Drops to 8–9%   Sponsored by: CometBackup Small Biz Thoughts Community  💼 All Our SponsorsSupport the vendors who support the show:👉 https://businessof.tech/sponsors/ 🚀 Join Business of Tech PlusGet exclusive access to investigative reports, vendor analysis, leadership briefings, and more.👉 https://businessof.tech/plus 🎧 Subscribe to the Business of TechWant the show on your favorite podcast app or prefer the written versions of each story?📲 https://www.businessof.tech/subscribe 📰 Story Links & SourcesLooking for the links from today’s stories?Every episode script — with full source links — is posted at:🌐 https://www.businessof.tech 🎙 Want to Be a Guest?Pitch your story or appear on Business of Tech: Daily 10-Minute IT Services Insights:💬 https://www.podmatch.com/hostdetailpreview/businessoftech 🔗 Follow Business of Tech LinkedIn: https://www.linkedin.com/company/28908079YouTube: https://youtube.com/mspradioBluesky: https://bsky.app/profile/businessof.techInstagram: https://www.instagram.com/mspradioTikTok: https://www.tiktok.com/@businessoftechFacebook: https://www.facebook.com/mspradionews Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

The discussion centers on the implementation challenges and partner enablement strategies for artificial intelligence (AI) within the technology channel. According to TD Synnex’s AI Accelerator program, only a small portion of AI projects achieve active deployment and measurable ROI, with widespread difficulties cited in scaling complex AI use cases. Jessica Yeck, SVP of Vendor Solutions at TD Synnex, highlights that progress is contingent upon engaging partners at their current state of AI readiness and aligning support resources accordingly. The evidence reflects a move away from one-size-fits-all approaches toward tailored frameworks that focus on tangible business outcomes and repeatable processes. TD Synnex’s revised strategy prioritizes meeting partners “where they are,” using assessment frameworks that differentiate between partners with defined AI strategies and those seeking foundational guidance. Jessica Yeck references leveraging the broader technology ecosystem—including vendors, ISVs, and hyperscalers—to deliver solutions with multi-party input. This approach enables partners to identify actionable opportunities and develop pipelines, but demands cross-functional collaboration and technical-specialist engagement, particularly as customization—rather than rigid standardization—is required for effective deployment. The episode also addresses the evolving role of technology distribution in supporting partners beyond logistics. There is explicit recognition of the importance of financial mechanisms, marketplace access, and consultative guidance for services. Jessica Yeck underscores the interconnectedness of relationship-building, competency focus, and ecosystem utilization, noting that partners do not need exhaustive in-house technical skills if they can identify and collaborate with relevant specialists. This points to a strategic shift in what services and value partners can realistically deliver. For MSPs and IT service providers, the key implications involve re-evaluating approaches to AI enablement and partner relations. Instead of prioritizing technical uniformity or attempting to master every subsystem, providers should invest in relationship management and focused competency development while leveraging broader ecosystem resources. Adoption risk is reduced when partners clearly understand their customers’ primary objectives and are prepared to orchestrate service delivery with targeted technical and financial support from their distribution networks. The episode reiterates that risk and accountability in AI projects hinge on practical readiness, process discipline, and honest assessment of operational capabilities, rather than technology enthusiasm or over-reliance on standardized templates.  💼 All Our SponsorsSupport the vendors who support the show:👉 https://businessof.tech/sponsors/ 🚀 Join Business of Tech PlusGet exclusive access to investigative reports, vendor analysis, leadership briefings, and more.👉 https://businessof.tech/plus 🎧 Subscribe to the Business of TechWant the show on your favorite podcast app or prefer the written versions of each story?📲 https://www.businessof.tech/subscribe 📰 Story Links & SourcesLooking for the links from today’s stories?Every episode script — with full source links — is posted at:🌐 https://www.businessof.tech 🎙 Want to Be a Guest?Pitch your story or appear on Business of Tech: Daily 10-Minute IT Services Insights:💬 https://www.podmatch.com/hostdetailpreview/businessoftech 🔗 Follow Business of Tech LinkedIn: https://www.linkedin.com/company/28908079YouTube: https://youtube.com/mspradioBluesky: https://bsky.app/profile/businessof.techInstagram: https://www.instagram.com/mspradioTikTok: https://www.tiktok.com/@businessoftechFacebook: https://www.facebook.com/mspradionews Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Welcome to a feed drop ofthe SMB Community Podcast, the longest-running MSP-focused podcast in the industry.  Hosts James Kernan and Amy Babinchak dive deep into AI go-to-market strategies for 2026, inspired by insights from Amy Babinchak’s recent AI class for MSPs.They open with the latest news on Microsoft Copilot and Anthropic's integration, highlighting new privacy and security features for Office apps. Then, they explore how MSPs can not only adopt AI internally but also create new, innovative service offerings for their clients—like custom AI grant-writing agents for nonprofits, real-world business demonstrations, and the integration of AI readiness assessments.Pricing strategies, project sales versus monthly recurring revenue, and the importance of meaningful quarterly business reviews also come under the spotlight. Throughout the conversation, Amy Babinchak and James Kernan share practical examples, discuss industry challenges, and encourage listeners to rethink and monetize their approach to AI as we move toward 2026.Tune in for fresh ideas, actionable strategies, and a glimpse into the real-world experiences of MSPs shaping the future with AI, and find it on your favorite podcast player.   Links at https://smbcommunitypodcast.com  💼 All Our SponsorsSupport the vendors who support the show:👉 https://businessof.tech/sponsors/ 🚀 Join Business of Tech PlusGet exclusive access to investigative reports, vendor analysis, leadership briefings, and more.👉 https://businessof.tech/plus 🎧 Subscribe to the Business of TechWant the show on your favorite podcast app or prefer the written versions of each story?📲 https://www.businessof.tech/subscribe 📰 Story Links & SourcesLooking for the links from today’s stories?Every episode script — with full source links — is posted at:🌐 https://www.businessof.tech 🎙 Want to Be a Guest?Pitch your story or appear on Business of Tech: Daily 10-Minute IT Services Insights:💬 https://www.podmatch.com/hostdetailpreview/businessoftech 🔗 Follow Business of Tech LinkedIn: https://www.linkedin.com/company/28908079YouTube: https://youtube.com/mspradioBluesky: https://bsky.app/profile/businessof.techInstagram: https://www.instagram.com/mspradioTikTok: https://www.tiktok.com/@businessoftechFacebook: https://www.facebook.com/mspradionews Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.