When Will SMBs Say, So Long Local MSP!

by ray stasieczko March 14, 2026

As artificial intelligence rapidly embeds itself into the architecture of all technology platforms, the lifestyle managed IT service provider built on an infrastructure at a time when Windows 95 was relevant, will find itself stuck in a past that, unfortunately, many won't escape.

SMB technology service providers must be able to monetize their intellectual capital. Those providers who still cannot monetize fee-based assessments, those providers who still believe that all customers are good customers and refuse to establish an upmarket ICP (Ideal Customer Profile), and those providers who, if any, still provide break-fix services or provide one-off commodity services to customers without recurring service contracts, you will fade into oblivion.

IT services for low-value clients will exist; however, these clients will be serviced without the need for the thousands of small MSPs that deliver through a business infrastructure built for a different time.

These services will be delivered at scale through artificial intelligence incorporated into multi-billion-dollar technology service platforms.

For example, for a decade, I have envisioned the day when telephony/ISP juggernauts will offer to their customers many of the services small-ticket MSP players currently offer.

Honestly, with the awakening artificial intelligence gave to the world who really believes that the MSP's outdated infrastructure isn't ripe for a major disruption.

Here are some updates to my thinking and warnings of the past: MSPs, the disruption is here.

T-Mobile provides wireless phone plans, 5G internet, and advanced networking solutions for small businesses, enterprises, and government agencies. Oh, and some plans include Microsoft 365 for free, and of course, internet backup.

All the telephony juggernauts are positioning to wipe out the MSPs who have built customer bases among commodity-minded end users. That means many MSPs will be disrupted.

Today, I think many would agree that the telephony/ISP providers are definitely a threat. However, five years ago, when I shared my vision of this disruption. Many argued that the touch-and-feel of local MSPs with end users would never give way to a technology juggernaut.

Unfortunately, Many MSPs, like my friends who sell print services, are out of alignment with the end users they serve and support regarding their value propositions, and these providers better get aligned quickly.

Those service providers still holding that stubborn mindset will be surprised when they lose the great relationships built on platforms for a different time to the juggernaut that simply provides a better experience built on modern-day infrastructure.

Let’s think about our home technology and imagine the changes coming to the workplace.

We all remember the terrible service and support we received from the cable providers from the 1990s through 2024, in my case. So much has changed. No cable, no drilling through the brick walls, no hanging around the house waiting for the cable guy or gal to show up, no crazy billing schemes where exiting or changing subscriptions is worse than having a tooth pulled.

Today, satellite service is only gaining in momentum. The day I returned my hard-wired modem to the cable company and turned on my T-Mobile wireless modem, and within 5 minutes had 3 floors of technology appliances all connected. No service tech, no phone calls to tech support, everything set up through my iPhone and, best of all, I can choose which subscriptions I want and unchoose them just as easily.

It took me 1.5 hours on the phone with the cable provider to cancel my old contract. For three months, they continued billing me, and to this day, six months later, they are calling me, offering free service and discounted rates to come back.

Unfortunately, like so many things, once you find a better way, the old way is soon forgotten. Regardless of the desperate approaches and ridiculous sales, all in the hope of luring one back to an outdated infrastructure.

In reality I liked my cable service. Yes, I complained when the billing was wrong, the cable was down, and the technicians showed up for an appointment based on the cable company's convenience, certainly not mine.

But I, as all cable customers knew, that was part of the experience. T-Mobile took away another internet provider's customer by delivering me a better experience. A bundled experience. which got me thinking what else can they bundle?

So now, I will probably never need to talk to a human or wait on hold again for home entertainment service. Similar to the way technology advances took way my last human relationship-based insurance company, I haven’t spoken or even met my insurance agent since I discovered the ease of online insurance.

Today in my home as millions of other homes the technology is managed from an app on my Smartphone. The solar and battery backup power system, the thermostat, the video surveillance, the entertainment, the lights, the stove, the water temperature, and even my grill on the patio.

The question many business leaders are asking is, " When can they navigate the technologies used in their business with the freedom and ease they can at home? The answer to that question is, NOW for much of the technology they use.

Here’s something to think about. How many hours a day does an executive utilize their smartphone in comparison to their laptop? Many MSPs would agree that during COVID-19, the business world underwent a massive shift from desktops to laptops. I think the migration to working off smartphones was even greater at that time and has grown exponentially, and the impact of that migration is and still is somewhat ignored by most of MSPs.

Today’s business worker can find, consume, add to, redistribute, file, or store all the knowledge needed right from their smartphones safe and secure in many cases more secure than the laptop. I would concur that many businesses and solopreneurs today spend 90% of their time on smartphones and only 10% on laptops.

So, the question is: when could all businesses be in a position to navigate through their entire technology suite from their smartphones? And how will the smartphone evolve as that becomes reality?

Artificial Intelligence is changing the way the world navigates for information and knowledge, leading to the obsolescence of much of what many cannot imagine, as the world was surprised by the devastation the smartphone itself caused and continues to cause to the status quo worldwide.

The disconnect that most MSPs have is the belief that their customers need them to babysit and navigate them through the complexities of technology. Yes, they may have up until about a year ago. Today, technology and its navigation are surpassing even the most forward-thinking expectations.

For the last ten years, I shared my belief that any MSP who feeds off the clients where price was more valuable than intellect would lose, as these clients would soon find providers who could globally scale much of the local MSP’s value even cheaper, oh and for those MSPs who believe that clients will favor the MSP whose CEO gives out their cell phone number to low contract value customers void of an ICP. Stop selling those customers.

Years ago, I penned this Rayism after talking to an executive in the equipment finance business who suggested that his organization’s greatest customer value was that when customers called, they would never hear the third ring. Here was my response.

“You can be the leasing company that answers the phone in two rings and lose your customer to the innovator that doesn’t even accept phone calls.”

The business-to-business service landscape is rapidly changing, and now more than ever, independent technology service providers must up their game in human capital.

The technology pieces and processes are evolving at record speed. Since the 1960s, the technology world has lived by Moore's law, which states that the number of transistors on microchips roughly doubles every 2 years while costs decrease. This phenomenon has enabled technology to advance in the 21st century in ways that those living in the early 20th century could not have ever comprehended.

Today might be the time to rethink Moore’s Law. I am thinking the momentum of Artificial Intelligence will surely outpace anything even Gordon Moore could have possibly imagined.

My warning to MSPs and to my friends in the print sector transitioning to become MSPs is to stop competing for commodity-based customers, based on deliverables that sit on an infrastructure built for a different time. These clients will soon leave you to a modern infrastructure built by a juggernaut who will simply provide a better experience.

Today, the MSP must take to heart my decade of warnings regarding the need to move upmarket and monetize intellect. The intellectual abilities to assist clients in communicating with artificial intelligence will be welcomed by businesses as the world of business undergoes the greatest technological disruption in human history.

MSPs reselling 365 licensing, getting commissions on VOIP engagements, and selling pass-through services such as backup services, cybersecurity, or helpdesk services to sub-10 K per month client engagements will be completely disrupted and wiped off the map.

I will also suggest that those master service providers such as ConnectWise who have platforms composed of thousands of small MSPs with low revenue client engagements will face massive challenges over the next couple years. I see ConnectWise as having a very costly infrastructure that will soon be completely outdated.

I also predict the valuations on the MSPs will come to realize that the days of 10-20 times EBITDA are over! The fact is that MSPs with low-dollar client engagements could soon be of no value at all to investors. Keep in mind that those multi-billion-dollar juggernauts won’t be buying MSPs; they'll just take away the MSPs' customers.

A warning to those print providers who are still attemting to build or have built a managed IT service deliverable based on low value customers, Stop!!!

In closing, all MSPs must question everything regarding their perceived value to the clients they serve. The commoditization of much of the Managed IT Service providers' stack has arrived. Artificial Intelligence is changing the industry's landscape and soon the landscape will be unrecognizable from what it once was,

“Status Quo is the killer of all that will be invented.”

Ray Stasieczko, host of the YouTube Series, The End Of The Day With Ray!