MSP Summit: AI Presents Big Opportunity for MSPs

CHANNEL PARTNERS CONFERENCE & EXPO/MSP SUMMIT — MSP Summit, part of the Channel Partners Conference & Expo, kicked off Monday with a heavy emphasis on MSPs embracing and growing revenue from artificial intelligence (AI). 

AI presents a huge opportunity and MSPs should be thinking about the $158 billion in available services. That’s according to Jay McBain, chief analyst at Canalys. His MSP Summit keynote focused on Hot Data: Channel Outlook and Opportunities. He then hosted a channel debate on whether AI will live up to its hype or fizzle.

Overall, there’s never been a better time to be an MSP, McBain said.

“For every dollar from hardware and software, there's going to be over $2 of services,” he said. “Last year, tech services became larger than telco services for the first time. But these services are growing faster than any category, and hardware and software. This is the place to be. This is the right room to be in. This is the right industry to be in.”

The managed services industry is growing at 6.2% this year, double the world’s gross domestic product (GDP), McBain said.

“This is the fastest-growing industry out of 27 industries or 297 sub-industries,” he said. “So this is the right place to be, but we have a lot of headwinds at the moment. And there's historical context to this growth. We look back to 2008, the last time this industry and the world had a major recession, and you look back to 2001, the two previous times the tech industry has taken the world out of recession. It's the people in this room, the partners who have been the tip of the spear of optimism, that have taken the tech industry and driven the world out of recession. So this is happening again for the third time.”

Last year, managed services became a $500 billion industry worldwide, McBain said.

“Managed services remains one of the largest opportunities we can all pursue,” he said. “There are now 335,000 companies in the world that have at least one managed contract. The rest of the world is now larger than the United States and Canada. Where 20 years ago 99% of MSP revenue was here in North America, it's now a global business. But suffice it to say, for everything businesses and governments are going to spend this year on technology, over one out of every 10 of those dollars will be on a managed contract. Eighty-two percent of buyers now outsource some or all of their IT.”

MSP Summit AI Debate

Panelists in the AI debate included:

Data is a core cornerstone for all these AI experiences today, Maxson said.

“When a lot of you engage with AI, it's probably through some sort of ChatGPT-type experience and all of that data is just public data that's generally available on the internet,” he said. “We think the next step of this will be building highly personalized AI experiences that are grounded in your company's proprietary data. So imagine a consumer goes on an e-commerce website, and they want to upload a picture of an outfit that they really like ... 'by this weekend, I'd like to spend over $200, here's my size.' You can do that in a natural language kind of way, and create a much more personalized, crafted experience to get the kind of content that you want from the other side of the edge. We're starting to see a large increase in our customers utilizing AI to improve their internal operations, the efficacy through which they drive experiences.”

When it comes to AI, Lenovo is looking at it in three phases, public, private and personal, Soo Hoo said.

“So when you start thinking about AI, it's all about choice,” he said. “Where do you use it? Who uses it? When do you use it? Why do they use it? All of this is really key. So I'm going to use some f-bombs over here right now. One f-bomb is fear of being obsolete (FOBO). Then there’s fear of missing out (FOMO). Who do I do it with? Who do I trust? And then there’s fog of war (FOG) as we start thinking through all of these challenges. So there’s all these different choices you have to make.”

Investing in AI Skills, Capabilities

Channel partners who want to get into the AI market need to invest in skills and capabilities, so HPE brings to the table a number of support services to train and develop the channel, Wall said.

“And we’re looking at it from a number of areas,” he said. “Probably the largest market in AI is inference, and we are investing in some inferencing type of tools and bundles where you can actually go and bring inferencing solutions to the customer. The second area is in AI tuning and basically training, and so if you can develop skills associated with that, as these models get deployed, you actually can have a long relationship with your customer, keeping those models current and keeping them tuned. The other area is professional services. And then probably the biggest opportunity on the development of the model side is high-performance computing (HPC) and AI. HPE has been investing the last couple of years in software for the learning (ML) development environment. So those are the areas that we're focused on working with you.”

Maxson invited MSPs to engage with MongoDB and “talk to us about how you think you can help integrate our technologies into your services to bring these (AI) applications to life.”

Soo Hoo said when having conversations with your clients about AI, it’s important to remember it’s personal, not strictly business. And Wall said when it comes to AI, MSPs need to look at their business and determine where they’re weak and move to augment that weakness.