March 2025: Inflation Stabilizes, Small Business Confidence Rises, AI Innovations from Kaseya & Zoom

[00:00:02] It's Monday, March 17, 2025, and I'm Dave Sopel. Three things to know today. Inflation Stabilizes, but confidence wavers how IT providers can navigate the shifts. Small Businesses are confident, but will they spend? IT and automation providers take note. And Kaseya expands their AI-powered cybersecurity while Zoom and Google bet on AI productivity. But will businesses buy in? This is the Business of Tech.

[00:00:30] In March 2025, inflation showed signs of relief with a 0.2% rise in the Consumer Price Index last month, following a 0.5% spike in January. Over the past year, inflation rose 2.8%, the lowest rate since November. Core inflation, excluding food and energy, increased 3.1% year-over-year, marking the lowest since inflation surged nearly four years ago. However, the Federal Reserve remains cautious as core inflation is

[00:00:59] still above their 2% target. Grocery prices were flat last month, despite a significant 10% increase in egg prices, which are up 59% over the past year. And recent findings from the University of Michigan's Sentiment Survey reveal a concerning decline in U.S. consumer outlook, with the sentiment index dropping to 57.9% in March of this year, a decrease of about 11% over the month. This marks the third consecutive

[00:01:26] month of decline and the lowest level since the fall of 2022. Notably, sentiment diminished across all demographics, including age, education, income, and political affiliation, with Democrats experiencing a significant 24% drop. Inflation expectations have also surged, with respondents anticipating a rate of 4.9% over the next year, up from 4.3% the previous month. In the fourth quarter of 2024, shipments of

[00:01:54] artificial intelligence-capable PCs reached 15.4 million units, which is 23% of all PC shipments during the period. The growth marks an 18% increase from the previous quarter, according to data from Canalys, now part of Omnia. Apple led the market with a remarkable 54% share of AI-capable PCs, followed by Lenovo and HP, each holding 12%.

[00:02:20] The demand for these devices is expected to continue, driven by approaching end-of-support for Windows 10, which has been identified as the primary factor influencing refresh decisions for many customers, as reported in a January poll of channel partners by Canalys. A recent global survey conducted by Lenovo, including 600 IT leaders, reveals that while nearly 80% believe artificial intelligence will enable employees to

[00:02:45] focus on more impactful work, less than half feel their current digital workplace solutions adequately support productivity and innovation. The survey indicates that a staggering 89% say organizations must first overhaul their digital workplace to fully unlock the potential of AI. And a recent survey conducted OmniSend reveals that 39% of shoppers abandoned their purchases due to frustrating interactions

[00:03:11] with artificial intelligence chatbots. While 88% of consumers reported having at least one conversation with an AI chatbot in the past year, only 28% believe that these systems consistently understand their needs. According to the Vice President of Customer Experience at OmniSend, many retailers may be incurring higher costs due to poor chatbot implementation, as 48% of consumers are seeking improved customer service quality from AI.

[00:03:38] The survey highlights that consumers prioritize accuracy over speed, suggesting that retailers need to rethink their strategies and view AI as a tool for enhancing customer experience rather than just improving efficiency. The findings indicate a growing need for hybrid support models that combine AI capabilities with human representatives for complex inquiries. Why do we care? It's the vibe that I'm worried about, and primarily due to the impact on providers' customers.

[00:04:08] Economic caution will influence IT spending decisions. Businesses are navigating uncertainty, so demonstrating ROI and cost-efficiency in tech investments is key. From a service provider perspective, this means being cautious about growth projections. A softening economic outlook may impact new client acquisition and contract renewals. However, with inflation stabilizing, cost pressures on IT services and hardware may ease slightly.

[00:04:34] The disconnect between falling inflation and rising consumer pessimism means that IT leaders should watch for continued volatility in business confidence and spending patterns. And despite the excitement around AI PCs, the actual business case remains unproven. Many customers might be upgrading for Windows 11 compatibility rather than AI features. IT leaders should be cautious about over-promising AI benefits that aren't fully realized yet,

[00:05:01] particularly as the OmniSend data shows how implementation can backfire if not executed properly. Poor AI experiences damages brand trust. This is a moment for IT providers to lead with education and strategy. The appetite for AI is there, but execution remains a challenge, helping businesses bridge that gap will be a winning approach. With every new breach and threat that I cover, it's clear that cybersecurity isn't a luxury anymore.

[00:05:31] It's a necessity. That's where Huntress comes in. Their fully-managed cybersecurity platform is built for every kind of business. Not just the 1%. Huntress seamlessly integrates their products and threat hunting team. Their EDR, ITDR, SIM, and security awareness training solutions are purposely built for their elite 24x7 security operations center to stop threats before anyone else even spots them.

[00:05:57] This potent combination of purpose-built cybersecurity and threat hunting expertise is one of the many reasons why G2 users have voted Huntress the number one rated EDR for growing businesses. To see what people-powered cybersecurity looks like, visit Huntress.com slash MSB Radio. And some interesting small business-focused data.

[00:06:22] Surprisingly, small business owners appear optimistic despite the chaotic political landscape during Donald Trump's presidency. According to a recent survey by PNC Bank, 78% of small business owners expressed confidence in their prospects this year, nearing a 23-year high. Bluevine also reported a surge in small business confidence, indicating it is at an all-time high.

[00:06:45] And Adobe's 2025 work-life balance report reveals that nearly 60% of entrepreneurs enjoy a better work-life balance compared to traditional employment. However, many struggle to disconnect from work, averaging just 11 days off per year. Entrepreneurs report losing sleep due to work-related concerns, with financial worries being the most common issue.

[00:07:07] A significant number, 82%, admit that work impacts their risk, with technological changes affecting baby boomers and family concerns troubling millennials. The report indicates a growing reliance on artificial intelligence, with nearly 40% of entrepreneurs planning to adopt AI tools this year to save time. On average, they save six hours a week, translating to 310 hours annually.

[00:07:31] Key priorities for AI adoption include lead generation and sales, along with automating accounting tasks. And despite long work hours, over 20% of small business owners work more than 50 hours each week, flexible schedules allow many to spend more time with their families. Financial independence remains a primary motivator for starting businesses, with 79% of entrepreneurs achieving this goal.

[00:07:54] When asked how they would use an extra 10 hours a week, younger entrepreneurs expressed a desire for more family time, while older generations would focus on health and wellness. And the National Federation of Independent Business reported a decline in small business optimism for February, as the Small Business Optimism Index fell by 2.1 points to 100.7. Despite this drop, the index remains above the 51-year average.

[00:08:22] The Uncertainty Index increased by 4 points, reaching 104, indicating rising concerns among business owners. The survey revealed that the percentage of owners expecting economic improvement dropped by 10 points to a net negative 37%, while only 12% view the current period as a good time to expand. Inflation continues to be a significant concern, with 16% of owners identifying it as their top problem, just behind labor quality.

[00:08:50] Hiring remains challenging, with 38% of owners reporting unfilled job openings and a net 15% plan to create new jobs in the next three months. Why do we care? You might think after that last story, clearly this shows I'm off-base, right? S&B confidence for the win. The PNC and Blue Vine surveys suggest historically high optimism, yet the NFIB data shows growing uncertainty and a decline in expansion plans. This disconnect is important.

[00:09:20] Optimism doesn't necessarily translate into spending. Business owners may feel confidence in their own resilience but hesitate on new investments, particularly in an inflationary environment with hiring challenges. And industry-specific factors likely drive optimism. Some businesses, particularly those leveraging e-commerce, AI, or automation, may be thriving, while others struggle with labor costs and economic unpredictability. And remember, to be a small business owner, you have to believe your business will work. Period.

[00:09:49] That's an inherent optimism both to believe in as an operator, frankly you have to, yet also to be aware of with customers as a risk. Hiring challenges mean automation and IT outsourcing are more attractive than ever. Market IT services as a cost-effective alternative to hiring full-time staff. And work-life balance concerns mean IT solutions must focus on true efficiency, not just adding complexity. Provide technology that actually reduces workload, not just another system to manage.

[00:10:20] Small businesses want to work smarter, not harder. IT providers that help them do that without overcomplicating things will match to customer demand. Kaseya launched new artificial intelligence-driven cybersecurity products designed to enhance customer efficiency and profitability. Building on its Kaseya 365 platform, the company has introduced features aimed at strengthening security postures against cyber threats.

[00:10:44] Key enhancements include an upgraded compliance manager that automates risk management and simplifies regulatory compliance, along with an AI-powered recap feature in the Autotask product that improves ticket documentation. Additionally, Kaseya's IT Glue, Smart Standard Operating Procedure Generator, automates process documentation in real time, while the Vohani division has launched a new internal network penetration testing service to identify vulnerabilities in user accounts.

[00:11:12] Zoom announced new agentic features for its AI companion, enabling it to perform multi-step tasks such as scheduling meetings and generating documents. The company introduced Zoom Tasks, which identifies action items in meeting summaries and emails set to launch at the end of the month. A new voice recorder feature will transcribe and summarize in-person conversations, while meeting agendas will help hosts stay organized during meetings.

[00:11:38] Additionally, a custom AI companion add-on will be available for $12 per user per month, offering personalized meeting templates and access to a personal coach. These enhancements are focused on improving productivity and collaboration. Google is officially transitioning from Google Assistant to its new AI platform, Gemini. The change is set to begin in the coming months, with the classic assistant no longer accessible on most mobile devices or available for new downloads later in the year.

[00:12:06] Users with devices running Android 9 or earlier and those with less than 2GB of RAM will still have access to the classic assistant. Google plans to upgrade a variety of devices, including tablets, cars, and smart home products, to Gemini, enhancing the user experience across its ecosystem. The company originally launched Google Assistant in 2016, and as Gemini becomes the overarching brand for its AI initiatives, the retirement of Assistant marks a significant shift in Google's strategy.

[00:12:34] More details are expected to be announced in the coming months, likely during the Google I.O. event in May. Why do we care? So tactically, those are all some updates. Strategically, consider this. There's some uncertainty in Zoom and Google's moves. Will businesses actually pay for AI-driven meeting management, or is this just another monetization attempt in a crowded AI productivity space?

[00:12:57] Zoom must prove that its AI enhancements deliver measurable efficiency gains beyond what existing productivity tools already offer. Will businesses and consumers accept a more powerful but potentially more complex AI assistant, or does this just be another Google product shift that causes frustration? If Gemini doesn't deliver on usability, this will be continued impact to trust in AI. Are you ready to get your brand in front of the tech leaders shaping the future of managed services?

[00:13:28] Here at The Business of Tech, we offer flexible sponsorship opportunities to meet your needs, whether it's live show sponsorship, podcast advertising, event promotion, or custom webinars. From affordable exposure options to exclusive sponsorships, our offerings are designed to fit businesses and vendors of all sizes looking to make an impact. Prices start at just $500 per month, making our packages a fraction of typical event sponsorship costs.

[00:13:58] Be a part of the conversation that matters to IT service providers worldwide. Join us at MSP Radio and amplify your message where it counts. Visit MSP Radio and engage today to explore all the ways we can help you grow. Thanks for listening. Besides St. Patrick's Day, it's also National Corned Beef and Cabbage Day, and apparently Act Happy Day. Green beer would be just a thing.

[00:14:28] Nerdy Ocon will be held in Palm Springs, California from April 7th through 9th. Visit NerdyOcon.com to learn all about it. The Business of Tech is written and produced by me, Dave Sobel, under ethics guidelines posted at businessof.tech. If you've enjoyed the show, make sure you've subscribed or followed on your favorite platform. It's free and helps directly. Give us a review, too.

[00:14:53] If you want to support the show, visit Patreon.com slash MSP Radio, and you'll get access to content early. Or buy our Why Do We Care merch at businessof.tech. Have a question you want answered? We take listener questions, send them in, ideally as a voice memo or video to question at MSP Radio.com. I answer listener questions live on our Wednesday live show on YouTube and LinkedIn.

[00:15:20] If you've got a comment or a thought on a story, put it in the comments if you're on YouTube, or reach out on LinkedIn if you're listening to the podcast. And if you want to advertise on the show, visit MSP Radio.com slash engage. Once again, thanks for listening, and I will talk to you again on our next episode. Part of the MSP Radio Network.