2025 Tech Outlook: AI Trends, Bespoke Platforms, and MSP Confidence w/ Seth Robinson & Rich Freeman

[00:00:14] CompTIA released its outlook for 2025, and as we all ponder next year, I invited Seth Robinson, one of the report's authors, and Rich Freeman from Channelholic to join me to discuss it.

[00:00:26] Welcome to the Business of Tech Lounge, the live version of the Business of Tech podcast. It's Wednesday, December 11th, 2024, and I'm Dave Sobel.

[00:00:36] We'll be having an interactive conversation here, and I'll take questions and comments throughout the show, so make sure to put them into chat.

[00:00:44] If you've got a question, we will happily try and respond to it.

[00:00:48] Now, I want to thank Sales Builder, our Patreon sponsor, whose support makes this show possible.

[00:00:54] Focus on your IT sales workflow with the power of automation, and visit them at salesbuilder.com. That's B-U-I-L-D-R dot com.

[00:01:02] A reminder, we will keep an eye on that chat. We'll watch for questions.

[00:01:06] Now, Rich Freeman is a seasoned journalist and analyst specializing in the S&B Channel.

[00:01:11] He founded Channelholic, a Substack publication offering news, insights, and analysis for MSPs.

[00:01:17] And previously, he served as the founding editor and executive editor at the Channel Pro Network.

[00:01:23] Rich, welcome back to the show.

[00:01:25] Well, thank you very much, Dave. I'm super happy to be back.

[00:01:29] I know you're excited to talk data and reports, just like I am. So we will dive in.

[00:01:35] Seth Robinson is the Vice President of Industry Research at CompTIA, where he analyzes technology trends and provides insights into areas such as IT security, cloud computing, IoT, and mobility.

[00:01:47] Prior to joining CompTIA in 2011, he held engineering and management roles at IBM.

[00:01:52] Seth, welcome back to the show.

[00:01:54] Hey, Dave. Thanks for having me back again.

[00:01:56] And you brought the catnip because when I invited you guys to join me, you said, not only do I want to join you, I've got a report.

[00:02:05] So I've got to dive right in with that industry outlook report that you've just released.

[00:02:10] And I'm going to ask the obvious question.

[00:02:13] How does the outlook look?

[00:02:17] I guess overall, well, for one, I should say, you know, this is one of my favorite reports of the year, partly because it's the last report of the year.

[00:02:24] So I get to hang them up after this.

[00:02:26] But also, I think it's the one where we get to speculate the most.

[00:02:32] And we're thinking about everything that we've seen in the past year, maybe more than the past year, and then trying to project that into the future.

[00:02:39] And I think the common thread that there has been over the past several years is the degree of optimism around technology, whether we're talking to IT professionals in any industry or IT channel professionals focused on the products and services that they're trying to get to their customers.

[00:03:02] And so I think that's kind of the big, big headline.

[00:03:16] We've seen that, like I said, for a few years, we continue to see that this year, IT professionals are feeling really good about their careers, IT channel forums are feeling really good about their prospects for next year.

[00:03:27] I think the environment where all of these technology professionals are operating is getting a little bit more challenging because the decision makers, I believe, are starting to want to know with a little bit more certainty what return they're getting on all those technology investments.

[00:03:47] So I think those are the two sides of the coin that we explore throughout the trends in the new Outlook report.

[00:03:54] All right, I'm going to ask my next follow-up, and then I'm going to kick it over Rich, who I know has got one.

[00:03:58] I noted, though, in there that fewer than half of businesses feel confident in their basic IT services, and specifically, that was a drop from a decade ago.

[00:04:06] Now, I'll buy into the industry being confident, but at the same time, I'm noting embedded in that is a drop in confidence over basic IT services.

[00:04:15] Now, the concern I have here is that, and I think it's cited in the report as well, is that lack of confidence may hinder adoption of advanced technologies going forward.

[00:04:26] How do you kind of reconcile those two conflicting perspectives?

[00:04:31] Yeah, I think that's definitely the case.

[00:04:33] And that data point that you just cited comes from another study that didn't come from ours.

[00:04:37] But I think that the concept is the same, where for a long, long time, IT was kind of a cost center.

[00:04:47] It was a tactical activity.

[00:04:48] It was a support activity.

[00:04:50] And it was kind of like electricity.

[00:04:52] As long as it was there, that was fine.

[00:04:55] But now companies are wanting their technology to do more.

[00:04:59] And I think that factors into that lack of confidence around basic IT services.

[00:05:06] Even if you really got down to nuts and bolts, and you were saying, well, we're talking about basic IT services.

[00:05:11] How much confidence do you have that your network is going to stay up and running?

[00:05:15] Maybe that confidence is still there.

[00:05:17] Maybe that's gotten shaken a little bit because the bar has raised a little bit.

[00:05:20] Maybe companies are expecting five nines of reliability, where they were only expecting three before.

[00:05:27] And so they're a little less confident.

[00:05:29] But I think that it all gets back to definitely wanting technology to be a very strategic part of operations moving forward and future plans.

[00:05:40] But also wanting to have that confidence that the technology is doing what you need it to do.

[00:05:46] That the investments you're putting in are paying off.

[00:05:49] And they're building competitive differentiation.

[00:05:51] They're helping you meet your goals, whatever it is.

[00:05:53] And I think that's a very different equation than trying to just say, you know, is it there or not?

[00:05:59] Is it doing the support role in the way that we need it to?

[00:06:02] I think it's very different.

[00:06:03] And I think technology professionals and technology leaders need to start thinking about their approach to that question.

[00:06:09] Well, Rich, I'm going to bring you into the conversation.

[00:06:11] What was jumping to your mind that we wanted to dive into with Seth?

[00:06:16] Well, I want to specifically follow up on what the theme that you raised there and his answer, which was all about confidence.

[00:06:26] And this was a big theme in the report, basically, that businesses want to know that the money they spend on technology is actually going to deliver ROI for them.

[00:06:39] And that's something I certainly see, and it makes a lot of sense to me.

[00:06:42] But as I was reading the report, I was wondering to what degree is the outlook in IT and some of the other statistics you've got there on the report, how much of that is shaped by a lack of confidence about the future?

[00:06:56] Right?

[00:06:56] Because that certainly affected business spending within and beyond IT in the past year.

[00:07:02] We've got a change coming in the White House.

[00:07:05] Interest rates are coming down.

[00:07:06] They're still pretty high, though, and we don't know how fast or how far they go down.

[00:07:10] We've got, you know, war in the Middle East and in Eastern Europe.

[00:07:14] And that uncertainty, that lack of confidence about the future has certainly affected IT spending in addition to this, you know, concern over, am I really getting something in return for the money that I put into IT?

[00:07:29] And the reason I bring it up is because the, you know, show me the money, you know, show me the ROI kind of issue is more of a secular thing.

[00:07:41] Whereas some of the confidence issues I was just talking about are a little bit more on the cyclical side.

[00:07:47] Like, that could go away six months from now.

[00:07:49] People could be feeling a lot more confident than they are now.

[00:07:52] And that could have some effect on their thoughts about spending and what they spend on.

[00:07:58] Do you have any thoughts at all?

[00:08:00] Either of you about how that kind of confidence factors into the picture?

[00:08:05] Yeah, I think that's an interesting thought that there are two things here that are probably tightly woven together, but they can be pulled apart a little bit.

[00:08:13] I would say ever since the pandemic, we have seen, I think, some of the things that you're talking about, Rich, kind of this knowledge that like, oh, global events could be a little bit more fragile than I used to think they were.

[00:08:27] When we saw, you know, supply chain disruption, when we saw disruption because of conflicts abroad, when we have questions about what regulations there might be, when we see that the interest rate is changing the economics of business decisions.

[00:08:43] I think all of those things, kind of one after the other, have kind of kept that confidence, kind of like you're putting it, at maybe a slightly lower level than it was before.

[00:08:55] I think there's always, or these past few years, there's been this fear, this question about like, what other shoe is about to drop?

[00:09:05] And do I want to maybe reserve a little bit?

[00:09:07] Do I not want to go, you know, hog wild with my spending or my hiring or whatever it is?

[00:09:12] Because there could be some things that happen that are completely out of my control and that I absolutely can't predict right now.

[00:09:19] So I think that that is definitely factoring into a lot of decision makers' thoughts about the future and how much they want to spend.

[00:09:29] And they definitely know that they want to keep spending on technology.

[00:09:33] You know, we cite some data from Gartner in our report showing that they're expecting technology spending to have a pretty healthy jump next year.

[00:09:41] And I think there are a couple caveats with that.

[00:09:44] You know, one is a lot of that spending is going to be happening among really large cloud providers or those companies that are trying to build up their AI infrastructure.

[00:09:53] That might not trickle all the way down into like the SMB market.

[00:09:57] And then the other caveat is that a lot of that technology spending might be happening in business units.

[00:10:03] And it's still the technology professionals that are probably going to have to answer for how technology is being utilized, how it's performing.

[00:10:12] So I think the technology professionals really need to take the lead here on starting to try to reshape mindsets and culture around technology because it's not that cost center that we used to have.

[00:10:25] It's not the consumer space where people don't ask ROI questions, right?

[00:10:31] They just want the fancy new gadget.

[00:10:33] And it has some value to them and it just sort of works in their mind.

[00:10:38] But businesses don't operate that way, not long term anyway.

[00:10:42] You know, you might have some executives that are saying we need to get more AI.

[00:10:46] We need to keep up with the latest trends.

[00:10:48] But at the end of the day, they really need to see how that's paying out.

[00:10:52] Now, it's interesting.

[00:10:53] So Richie, you'd asked a little bit on my take.

[00:10:55] And I think I'd echo what Seth is saying.

[00:10:58] But I'm going to always layer in the fact that first off, it's my general experience that both SMBs and generally IT people fall into optimistic categories, right?

[00:11:10] If you're running your own small business, you're generally at least optimistic enough to know that things are going to improve for you generally because you have to have enough faith to do that.

[00:11:20] So if you're an SMB business owner, you generally are entrepreneurial and you tend to have a positive outlook.

[00:11:26] And I tend to find that that's also reflected in a lot of the managed services providers that we talk to.

[00:11:31] They are also then entrepreneurs.

[00:11:33] And so there has to be like a certain degree of faith that things will improve.

[00:11:39] Without getting political at the same time, I think what we're entering into is we are entering into a period of more turbulence.

[00:11:48] But I think in some level, you know, some of that has been chosen turbulence.

[00:11:52] And in fact, turbulence is kind of the point.

[00:11:55] And so if if that's what you wanted, then you're getting what you want.

[00:11:59] And so you're optimistic that change is coming.

[00:12:02] And theoretically, change might be an opportunity.

[00:12:05] One of the things that I thought was also interesting to layer this in with is is that in the reports that you noted 67 percent of channel firms believe MSPs should be subject to stricter regulations, such as requiring cyber insurance or internally managed SOC.

[00:12:19] And of course, then that's countered with the fact that there isn't even a universal definition of what MSPs are.

[00:12:27] So in one way, it's sort of saying we're we're we're again entering this area of turbulence where those of us considering this who say, you know, there should be more regulation are also reckoning with the fact that there's a lack of definition.

[00:12:40] Are you viewing or let's rephrase is MSPs and the outlook viewing that as a positive or a negative?

[00:12:52] And I'll throw that to Seth as for the report.

[00:12:56] The the thoughts towards like some strict regulations or licensure as a positive or a negative thing.

[00:13:03] Yeah, that's that's kind of I'm curious on.

[00:13:05] Yeah, I mean, I think that the sentiment that we've captured and there's a few different data points that kind of go into this sentiment.

[00:13:13] But I I think the general sentiment is that MSPs feel like it would be a good thing.

[00:13:20] Like if we could be licensed in the same way that an accountant or a lawyer or a dentist or whatever, if we could be licensed, then that would take away some of these questions around like, hey, how do we know that you follow best practices?

[00:13:34] How do we know that you're going to keep my data secure?

[00:13:37] That might help solve some of that.

[00:13:40] But there are a lot of really big questions around standards or licensure or whatever you would want to call it.

[00:13:47] It's been a point of debate for for several years.

[00:13:50] I mean, this certainly isn't the first time that it's come up.

[00:13:52] It's not the first time that we've talked about it.

[00:13:54] But it seems like with the growing regulations that we see in governments around the world, with the growing customer requests for cybersecurity and reliability of services,

[00:14:09] that maybe licensing or standards or regulation solves more problems than it creates.

[00:14:17] And and it'll be interesting to see, I think, how that evolves over time, because I think one of the biggest questions is, well, who would do this?

[00:14:24] Right. And would it be the government?

[00:14:26] You know, would it be some kind of third party, you know, trade association like ours?

[00:14:31] What would that look like?

[00:14:35] And you usually need kind of a confluence of events, you know, in order to get all the stars to line up and people to start falling in line with something like this.

[00:14:44] And a lot of the elements are there, but there are definitely some complications with that.

[00:14:50] Now, I'll call out to the audience if you've got questions or comments, throw them in the chat.

[00:14:54] We will definitely bring that up.

[00:14:55] Rich, I know you've got more, so I'm dying to throw it over here.

[00:14:59] What else perked your interest that you wanted to throw out for discussion?

[00:15:03] Well, I want to follow up on on what we were just talking about there.

[00:15:07] So, first of all, our mutual friend, Carl Palachuk, would be very, very angry at me.

[00:15:12] If I didn't point out that there is an organization that, among other things, is very much thinking about what regulations and professional qualifications for MSPs might look like.

[00:15:23] It's called the National Society of IT Service Providers, and you can look it up and learn more about it there.

[00:15:30] I think, and here's my sense of things, Dave, and as a former recovering MSP yourself, you'll probably have some thoughts about this.

[00:15:38] My guess is, and if this sounds like I'm calling MSPs hypocrites, I really am not.

[00:15:45] Okay.

[00:15:47] I suspect a lot of them are not terribly pro-regulation as a rule.

[00:15:52] They are pro-regulation for people who are not them.

[00:15:56] And what I mean, you know this issue well.

[00:15:59] Theoretically, anybody can hang up a shingle and say, I'm a managed service provider.

[00:16:03] I'm an MSP, and there are a lot of people who do that and provide very poor service to their customers.

[00:16:08] There are security incidents that, you know, result from that.

[00:16:11] And it gives the entire profession a bad name.

[00:16:14] And so, I think when I read that part of Seth's report about thoughts about regulation, I think it was not so much, hey, please, somebody regulate us.

[00:16:24] It was more like, hey, will somebody please regulate the trunk slammers out of this industry so that the rest of us who are truly professional about what we do don't wind up having to deal with the repercussions of some of the people we're competing with.

[00:16:39] Yeah, I think there are two sides of that, Rich, where you're probably right that MSPs that have their act together aren't necessarily looking for like one more thing that they have to do, i.e. compliance to regulations.

[00:16:54] On the other hand, there's probably a sense that if they want to try to bring in regulations that would raise the bar and kind of raise, you know, a rising tide lifts all ships and it would get rid of some of the riffraff, they believe that they can weather that storm, right?

[00:17:11] They believe that they can tolerate it.

[00:17:13] It's the same that you see, you know, the really big technology firms that might be saying, you know, we think we need more regulation around AI or content moderation or whatever, because they think they can tolerate it and they think that will create more barriers for entry for some of their competitors.

[00:17:29] So there's probably two sides of the coin there.

[00:17:33] But I believe that at the end of the day, the strongest MSPs might feel like it's a little bit of a headache, but they might feel like it's a necessary headache, maybe not a necessary evil, but a necessary headache in order to, like I said before, really eliminate some of these, you know, concerns and customer issues that are running throughout the industry.

[00:17:59] Yeah, you're exactly right.

[00:18:01] I do have an opinion on this one.

[00:18:03] And my quip has always been that my barber who cuts my hair has more licensure than the guy who's supposed to protect my data.

[00:18:11] And that feels like a bit of a problem from my perspective, you know, particularly when I love always when we have these conversations, I love the parallels to lawyers, doctors, accountants, you know, A, highly respected and B, generally paid very well.

[00:18:27] And I like that.

[00:18:29] I like those two components for the business.

[00:18:31] And I think I would agree thematically with everything we've said here in that, you know, people like it for the fact that like, oh, it'll be great for me and it will push away the competitors without necessarily considering that they will be part of that.

[00:18:44] I think the big piece that will be interesting to layer on top of this is to watch CMMC 2.0 this coming year as we think about that.

[00:18:54] You know, Rich, I'm right there with you in Carl's initiative and what's going on with the National Society.

[00:19:00] I think it's much more likely that we'll get the industry movement around CMMC first, particularly because defense is such a large portion of the marketplace that I think that'll be the element that sort of plays it out as this all plays out.

[00:19:16] Now, something that I know I've got to bring up because, Rich, it's going to interest both of us is, Seth, one of the big things that you noted in here was the rise of bespoke platforms.

[00:19:26] And we've been having the whole conversation around MSP platforms, you know, has been thematically the whole theme here.

[00:19:34] And I wanted to get a little bit of clarification of kind of what the perspective was on what's happening with bespoke platforms as we move into 25.

[00:19:43] Yeah, this was one of those that where I'm definitely exercising that speculation muscle a little bit.

[00:19:49] But like when I talk to software developers, when I look out at the software industry, you know, since cloud computing took off, companies have been bringing in just all sorts of applications and so many parts of their business that weren't digitized have become digitized.

[00:20:04] And one of my favorite things to talk about is the complexity of the technology stack that it's gotten very, very complex.

[00:20:11] And so something like AI comes in and everyone thinks, oh, here's this cool new thing.

[00:20:15] But what AI is trying to do is insert itself into a very complex technology stack.

[00:20:21] And that creates ripples all over the place.

[00:20:23] And then there are second order effects and repercussions.

[00:20:26] And it all becomes much more complicated than anyone imagines at first.

[00:20:30] I think that thing is happening very much in software where any given company has applications all over the place.

[00:20:37] They've got their data all over the place.

[00:20:39] And what they're trying to do is stitch all of this stuff together so that they can run the business and so their employees can go through a workflow and eventually so that a lot of things can be automated.

[00:20:51] The bespoke platform that I'm talking about is kind of the work that would get done by software developers that could be internal to a company or maybe they could be contracted.

[00:21:03] But it's all the work that gets done to stitch that stuff together.

[00:21:07] It's almost a skunkworks type of thing that it's never going to have a name.

[00:21:11] And like I said in the report, I don't think any company would ever package this up and it would become their version of AWS, right?

[00:21:19] Where they were using this thing internally, but it's valuable to everyone.

[00:21:23] It could be valuable to everyone.

[00:21:24] But the fact that it needs to be bespoke or tailored to everyone, I think prevents it from becoming a packaged solution.

[00:21:32] I think lots and lots of companies are going to be doing this work.

[00:21:35] And they're not just going to be putting their software developers into, hey, we need a new website.

[00:21:40] We need an e-commerce solution.

[00:21:42] They're going to be saying, we need to stitch everything together.

[00:21:45] And we need our workflow to be automated so that we can leverage the same sources of data, so that we can have comprehensive cybersecurity, so that we can eventually get into AI that fine tunes this stuff.

[00:21:57] And I just think there's going to be an incredible amount of work that happens that's almost silent or mysterious or unrecognized because it doesn't result in a shiny new product that lands on the web or goes out the door.

[00:22:13] All right, Rich, I know you've got something here.

[00:22:17] Well, I've got a few thoughts about this.

[00:22:20] So because there are multiple dimensions to the platform story.

[00:22:25] And one is from an end user perspective, there's all sorts of research out there about the dozen, sometimes hundreds of different applications that are in use at end user organizations.

[00:22:38] And the idea that what you've got to assume is the case that companies would very much like to simplify that.

[00:22:46] If nothing else, just simplify how they access and integrate and utilize all these systems.

[00:22:53] There's got to be a pretty strong appetite for that out there.

[00:22:57] And so I would think, and I don't have any particular tool in mind, but this sounds like a great service opportunity for an MSP to go into, you know, this is where you're really adding value and not just reselling stuff.

[00:23:09] You can come in there, understand the organization, the workflows.

[00:23:13] You can kind of build a bespoke platform specifically for that company.

[00:23:17] But obviously, this whole kind of platform question is very much in play right now internally at MSPs where there is this trend, this dynamic at play right now where on the one hand,

[00:23:31] it is very appealing to consolidate these many, many tools that MSPs are using and simplify that and take advantage of the integration and the productivity benefits, etc.

[00:23:47] that come with that.

[00:23:48] And on the other hand, you know, the perennial fear of lock-in if you're too dependent on any one vendor.

[00:23:55] And the sort of interesting middle ground example, as I was listening to you talk about this, Seth, what came to mind was ConnectWise,

[00:24:06] which is kind of creating, I think, trying to create a customizable bespoke platform.

[00:24:15] And the best example of that that they have in market now is the system called Security360, which is built on their ASIO platform.

[00:24:24] They're heading more and more in this direction as we move forward in the future.

[00:24:28] And the idea is they're going to create this composable, customizable interface that will provide you access to all the ConnectWise software that you use,

[00:24:38] but also allow you to pull in software from all of ConnectWise's ecosystem partners.

[00:24:45] And it'll all kind of, you'll get to all of it through one interface.

[00:24:49] Everything looks the same.

[00:24:52] So there's all sorts of stuff going on on the back end, but it all kind of looks and works consistently for the MSP.

[00:25:00] That kind of feels like maybe a bespoke platform for MSPs that we're seeing.

[00:25:07] Yeah.

[00:25:08] I mean, this idea isn't brand new, right?

[00:25:10] It's either ConnectWise or other platforms for MSPs or it's ERP systems that enterprises used to be the ones that they could only afford that.

[00:25:20] And I think that's the same idea here, right?

[00:25:23] And so if you're a company and you can get everything that you want tied into a platform that you would buy from somebody, that's great.

[00:25:31] You don't have to invest in the software development.

[00:25:33] I think the challenge, the reason that ERP systems or some of these other platforms haven't just completely taken off is these ecosystems are so fragile, right?

[00:25:42] And you pull in a new application where you didn't have an application before or you get an update on an application and it doesn't quite work with the platform.

[00:25:53] And now all of a sudden you're either waiting for patches or you have to do the custom work yourself, right?

[00:25:58] And so, I mean, that's the equation that's trying to be balanced here, right?

[00:26:02] Is can you buy a platform from somebody and have it run everything and have it do all of these things for you?

[00:26:09] And then you have to kind of absorb some of the cost of what happens when that platform breaks or do you want to invest in your own software development?

[00:26:18] I think you're absolutely right, Rich.

[00:26:20] There's a huge opportunity here for MSPs, but I think we have seen over the years that one skill set that MSPs are not necessarily the strongest in is software development, right?

[00:26:32] And so this would be an issue where now all of a sudden, you know, MSPs are having to do the same thing with software development that they're having to do in a lot of other cases where they have to have that skill internally to either optimize their own platform or for whatever other reasons.

[00:26:48] And they have to have enough of that skill on hand to serve client needs as well, right?

[00:26:54] And software is certainly not the pinch point that something like data analytics or cybersecurity is, but we still run into this supply-demand equation, supply-demand problem.

[00:27:06] And MSPs are competing for software skills up against a lot of other companies that software developers tend to have heard of and think that they would like to work for, right?

[00:27:15] And so how exactly do they attract that skill, retain that skill, grow that skill for themselves?

[00:27:22] And, you know, this is also cyclical, right?

[00:27:25] Like we find that we tend to swing back and forth between platform plays and then back towards best of breed solutions and back to platform plays and back to best of breed solutions.

[00:27:36] And that's a certain degree, a product of the fact that technology changes, right?

[00:27:42] So there's a certain time we're pulling it all together makes sense as the technology matures and then it becomes a little disrupted by best in breed products and we have an explosion of new options.

[00:27:51] And so we scatter to the winds a little bit and then we pull it back in again with, you know, as they consolidate.

[00:27:57] And I expect we will see this be cyclical.

[00:28:01] We're probably entering into the platform plays and I would definitely agree that that's the trend we're seeing.

[00:28:07] It'll happen for a long time.

[00:28:09] Then probably those platforms will disappear into the background and we'll move into something else that's driving it that doesn't.

[00:28:16] And as we consider moving into something else, the last area I specifically wanted to ask before I had two other things to throw your way was I wanted to ask a little bit about like the,

[00:28:26] what I felt was a real increase in international business.

[00:28:31] 47% of channel firms have been done business internationally in the past year.

[00:28:35] And by the way, with high satisfaction rates.

[00:28:38] Seth, were you surprised by that too?

[00:28:41] And what are you seeing around that kind of internationalization trend?

[00:28:45] Yeah, my colleague Carolyn April focused on this one the most.

[00:28:49] But as we were approaching the report this year, I think we saw that this was becoming more and more of a theme, right?

[00:28:56] That a lot more companies were finding the opportunity to do business across borders, right?

[00:29:03] With the rise of data services, with the rise of cybersecurity services, with the rise of things that don't necessarily need you to be on-prem.

[00:29:13] So I think that the data that came back, you know, kind of confirmed that feeling that a lot more companies are expecting to go global,

[00:29:22] maybe not fully global, but at least, you know, do something in Canada, do something in Mexico, do something in the UK,

[00:29:28] maybe work with vendors that are based in other places.

[00:29:32] And that's really interesting.

[00:29:34] And it opens a lot of opportunity.

[00:29:36] It also opens a lot of questions, you know, back to the regulation problem.

[00:29:41] You know, regulation is not just something that's happening here in the US.

[00:29:44] It's happening all over the place.

[00:29:46] And it's happening differently all over the place.

[00:29:49] I mean, we see a lot of areas that are more strict with their data than we might be here in the US.

[00:29:55] We see a lot of places that are thinking differently about cybersecurity.

[00:29:59] And so if you start operating globally, then the biggest thing that really raises is how are you making sure that you are covered to do business in those geographies, right?

[00:30:13] And that you've got a good awareness, not just of the market demand or the cultural differences, but also the regulations that you need to comply with as an MSP.

[00:30:25] Now, Rich, I know I'm, you know, an addict for those international questions.

[00:30:29] I would be remiss if I didn't throw it to you.

[00:30:30] Say, I know you've got one or two more that we want to get in here.

[00:30:33] What else is on your mind?

[00:30:35] Well, let me just comment quickly.

[00:30:38] I had a thought listening to this topic about going global, basically, business going global, because we have seen the rise of these bigger and bigger MSP roll-ups.

[00:30:51] This has been a big year for that, but it's a trend that's been going on for a while.

[00:30:55] And the biggest of those roll-ups in most cases have people, have offices, have clients overseas already.

[00:31:03] And we're going to see more international expansion by some of these companies going forward.

[00:31:09] And so one of the reasons these roll-ups have formed and one of the sort of competitive advantages that they have is a lot of businesses, you know, operate in multiple parts of the U.S. right now.

[00:31:23] So they, you know, they have a headquarters somewhere, but there are satellite offices, there are business partners, and it's advantageous for an MSP who can meet those needs wherever they are within the country.

[00:31:33] To the extent that businesses are increasingly going global as well, there could become a bit of a competitive edge for companies that can meet the needs of their clients over borders, as well as just across the country, which is not something that I've really thought about much before.

[00:31:50] But the bigger that internationalization trend gets, the more of an issue that becomes for MSPs and exactly the way that it's getting harder to focus exclusively on your hometown now.

[00:32:07] Interestingly, we're talking about this literally, and I'm sure Richie just saw the same thing I did.

[00:32:12] Evergreen announced their eighth acquisition in Australia just this morning.

[00:32:16] So, I mean, if we're thinking about that as a platform play, I definitely am seeing the data playing out that way.

[00:32:25] Yeah.

[00:32:27] Go ahead, Richie.

[00:32:28] No, no, no, go ahead.

[00:32:29] Well, Seth, I want to throw it, because the one thing I know, anybody who writes a report always has kind of their favorite bit.

[00:32:35] And I sort of wanted to ask, so for you, what's that one takeaway or piece that you worked on that you really wanted to make sure gets some additional focus?

[00:32:46] I think we already talked about my favorite piece, which is kind of this two-sided coin of companies really wanting to invest in technology, but also really wanting to have that measured and to be able to show and justify why they're spending on technology.

[00:33:03] I think that is the thing that I'm going to focus on.

[00:33:05] And since we've already talked about that, I'll go to my sort of second favorite thing from this conversation, which is that neither of you asked me about AI.

[00:33:14] I mean, how great.

[00:33:15] You know, this is the longest that I've talked in something like this without talking about AI.

[00:33:20] But I will talk about it now.

[00:33:21] And I'm going to go back, Dave, to what you were saying about the general optimism among technology people, among MSPs.

[00:33:28] One other reason that I would throw out there for that optimism is that in the face of all of these kind of macroeconomic issues that Rich mentioned, you know, supply chain problem or, you know, the pandemic or whatever it might be, people tend to think that technology is the solution to that.

[00:33:46] So, OK, we all have to go remote.

[00:33:48] Great.

[00:33:48] We can enable remote work.

[00:33:50] OK, supply chain problem.

[00:33:51] Let's start throwing data at that and figure out how to optimize.

[00:33:54] So there's this sense that technology is the solution.

[00:33:58] And I think AI has really been riding a hype wave because of this sense that AI could be the solution to so many things.

[00:34:07] And as much benefit as technology or AI might bring to a problem, I think the complexity that I talked about before, especially as some of the problems that are trying to be solved are not just technology problems.

[00:34:24] We've talked a lot about how we move beyond speeds and feeds.

[00:34:28] And we're talking about trying to solve real business problems, real world problems.

[00:34:33] Those are very thorny problems.

[00:34:35] Right.

[00:34:36] And so as technologists are trying to apply their skill and their knowledge and all of the latest technology trends to solve customer issues, I think it is really incumbent on them to be aware of every side of those issues.

[00:34:52] Right. And thinking through not just trying to rush in and insert technology, but as they are supplying technology products and services, as they are trying to provide some justification for those.

[00:35:04] They're also providing some awareness and education around some of these second order effects or unintended consequences or corner cases that you really have to watch out for rather than just assuming that technology can be the be all and end all.

[00:35:19] Well, interestingly, so I intentionally tried to resist going straight to the hype.

[00:35:25] But I'll comment on the fact that I'm finding AI is entering from my perspective, sections of it are entering into the plateau of productivity.

[00:35:33] And what I mean by that is, is I'm starting to see very much two worlds of AI discussion.

[00:35:38] The first is the incredible hype stuff.

[00:35:40] And frankly, a lot of, you know, the, the other media that is not on this call, but is that is oftentimes the stuff that we're seeing so much of things like perplexities, ability to do online shopping is falling into that category of like, that's very hype.

[00:35:56] But at the same time, I'm seeing instances like what the New York Times just reported on with the new 15 day forecasting capability for weather systems that's coming out of AI.

[00:36:08] And I'm seeing, and I'm looking at that saying, okay, that's actually a very implementable use case that makes a lot of sense in a lot of industries that are going to be leveraging that.

[00:36:16] And interestingly, I'm going to pair that up with some data that Gartner was just talking about on stage earlier this week, where they actually highlighted the fact that they think roughly 50% of, of, of AI money is in the consumer spend side.

[00:36:30] But 50% of it is in the API side, the backend calls to these models.

[00:36:35] And I think what's interesting is, is the stuff that's useful is those use cases that back to your first point is, is like AI and IT broadly is now required to deliver ROI.

[00:36:48] That return on investment has to be measurable and you can see it in the two categories.

[00:36:53] The stuff that's interesting is the stuff that you can actually relate to a business case.

[00:36:57] The stuff that's hype a little less so.

[00:37:02] Yeah.

[00:37:03] Yeah.

[00:37:03] I mean, we, we've talked a lot about how the, the, the consumer space and the technology that's getting developed for the consumer space has influenced, you know, enterprise stuff.

[00:37:13] And I think we've seen that with AI, right?

[00:37:15] Where there's this consumer application and it blows people's socks off and it seems amazing, but figuring out the business use case, figuring out the enterprise application, I think has been a little bit more challenging.

[00:37:28] And like, like you said, it's not necessarily going to come as a point solution.

[00:37:33] It's not going to show up as this packaged tool that every business is going to start investing in.

[00:37:40] It's going to be this backend stuff.

[00:37:42] And we, we believe that in many cases, AI is going to be embedded in what they're already doing.

[00:37:47] Right.

[00:37:48] So, so again, backing up and thinking about this overall technology stack and how that gets optimized and which skills you need in order to really make that thing sing.

[00:37:57] I think that will be the challenge of the next few years.

[00:38:01] Well, that is a great place to end this on.

[00:38:03] Jets, this has been super fun to have you here, but I'd want to make sure, Rich, is there anything that you wanted to ask about that you didn't, that wanted to get in before we wrap up here?

[00:38:13] Well, there was one particular, I'm going to fix this camera issue folks, but there was one particular data point in there that goes directly to something that I've been writing about a lot over the course of the year.

[00:38:29] And it was that only 17% of organizations are exactly where they want to be with their use of data.

[00:38:35] Um, and I've been thinking about this, writing about this a fair amount because AI, which we were just talking about is all about data.

[00:38:43] Um, and, um, you know, uh, uh, uh, aggregating data, integrating data, um, securing data.

[00:38:49] It feels like there is a big opportunity around, um, data infrastructure, data management, data services.

[00:38:57] Um, and I'm wondering if that, um, and that, that opportunity is very closely related to AI.

[00:39:02] I'm just wondering if that's something you see as well.

[00:39:05] Mm-hmm.

[00:39:05] Yeah, for sure.

[00:39:06] I mean, we've seen this for several years now, right?

[00:39:09] As companies say, Hey, we want to do big data.

[00:39:11] Okay.

[00:39:11] You've got to do your foundation first and make sure your storage architecture is in place.

[00:39:15] Oh, okay.

[00:39:16] Well, we want to do advanced data analytics.

[00:39:18] Well, you've got to make sure that your foundation is in place and your storage architecture.

[00:39:21] Oh, okay.

[00:39:22] Hey, we want to train AI.

[00:39:23] Well, guess what you have to do first, right?

[00:39:25] And so it's the same thing.

[00:39:27] Um, I think one of the funniest things in technology is as fast as some of the trends move,

[00:39:33] some of the lessons don't seem to get learned nearly as quickly.

[00:39:36] And so I think that opportunity is definitely there, uh, for an MSP to, to start coming in

[00:39:44] and saying, Hey, we can help you set up your data so that you can get to all these things

[00:39:49] that you want to get to.

[00:39:51] Uh, again, I think that's going to be an area where MSPs really have to concentrate on building

[00:39:55] the necessary skill sets, but it's a huge opportunity for sure.

[00:40:00] And I, I would echo that and I'll sort of end with the thought of a lot of this often

[00:40:04] rhymes, these technology trends.

[00:40:07] We've, we've seen the pattern.

[00:40:09] Those that have been a little gray hair to show our experience on this is this is similar

[00:40:13] to what we've seen before.

[00:40:14] And the trick is identifying the ones that are actually impactful and deliver that ROI.

[00:40:19] Jensen has been super fun.

[00:40:20] Really appreciate you joining me to, uh, to have this interactive discussion.

[00:40:24] Uh, believe me, my pleasure.

[00:40:28] Yeah.

[00:40:28] Yeah.

[00:40:28] And thanks again for having us, Dave.

[00:40:30] And, uh, that report is available on CompTIA's website for anyone that wants to check it out.

[00:40:35] So that's for that.

[00:40:36] And Rich, how can people find you?

[00:40:37] Uh, go to www.channelholic.news.

[00:40:42] Awesome.

[00:40:43] Thank you both.

[00:40:44] Well, I want to preview an upcoming interview for this weekend where I deep dive into the

[00:40:49] practical applications of AI and automation in the IT services industry.

[00:40:53] Derwai Todd, who's the CEO of Pia and Times S joined me to share his real world experiences

[00:40:58] on the challenges and opportunities of leveraging AI to streamline service deck operations.

[00:41:04] Here's a preview of that interview.

[00:41:07] And I want to get your sense of somebody who's kind of leading in that, that space.

[00:41:12] I want to get a, first off a sense of where we are in practical adoption, that what's really

[00:41:18] happening versus what's hype on our base?

[00:41:20] I mean, practically numbers wise, we've had hundreds of customers using Pia on a day-to-day

[00:41:25] business.

[00:41:26] AI is just another tool for us software people.

[00:41:29] So if you're in the software world, got tons of tools, tons of applications and languages

[00:41:35] we can use.

[00:41:36] AI just happens to be another tool in our toolbox.

[00:41:38] So effectively we can solve new business challenges with this technology if done right.

[00:41:44] So for example, AI hallucinates, you've got to knock down this hallucination.

[00:41:48] So as an example, as a ticket comes in on a help desk, we can train it to understand what

[00:41:53] that ticket's intent is.

[00:41:56] My Patreon supporters already have this video.

[00:42:00] If you want to listen right now, it'll drop on the weekend on YouTube and the podcast feed.

[00:42:04] If you're interested, I really do encourage you to go check it out.

[00:42:07] Visit patreon.com slash MSP radio to get access right now.

[00:42:11] And I want to thank Sales Builder, our Patreon sponsor whose support makes this show possible.

[00:42:17] Focus on your IT sales workflow with the power of automation and visit them at salesbuilder.com.

[00:42:23] That's B-U-I-L-D-R.com.

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[00:42:58] Thanks for joining me for the Business of Tech Lounge.

[00:43:01] And I will see you next time.

[00:43:15] Bye.