This is from the industry‘s favorite guy to give a microphone to, Jay McBain:

The MSP space is expected to experience significant growth in
2024 – here’s the top 10 predictions from our MSP guru, Robin Ody from Canalys:



1. Total managed services revenue in the channel
will grow 12% in 2024. Double digits in a tough macro environment.  [RAD: That seems reasonable.]



2. Over 50% of all MSPs will be operating an
ecosystem (co-managed and/or co-partnering) model in 2024. The decade of the
ecosystem!  [RAD: Define ecosystem because I don’t think HALF will be operating one, since 90% of the MSPs do under $5M in revenue!]



3. At least 33% of MSPs will be using generative
AI to build their own tools and automation processes by 2025. Once in a
generation internal opportunity.  [RAD: unless Jay defines MSP as something other than the definition that CompTIA uses, I don’t see it when 90% of MSPs do less than $5M in revenue.]



4. MSP partner programs will become widespread
across IT vendors in 2024. We are tracking 35,000 vendors asking how to do this!  [RAD: sure]



5. Compliance consulting services will grow 60%
for MSPs in 2024. Governance becomes the next frontier of managed services.  [RAD: I have seen other analysts with similar projections for compliance consulting, but I think they mean for the Big 5 like Deloitte.]



6. MDR services will be the number one growth
engine for MSPs in 2024, growing at least 50%. Cyber is becoming a team sport –
there is a natural MDR/XDR extension to every managed contract.  [RAD: sure]



7. At least three vendors in the RMM and PSA space
will be acquired by 2025. Watch this space closely. I know Robin already has a
couple under NDA.  [RAD: 3 large ones like CW or Kaseya or any 3 RMM/PSA like Halo or Screenconnect?]



8. M&A activity in the MSP channel will grow
50% in 2024, returning to 60% of 2021 levels. Not the surge from years back,
but a return to roll-ups and exit opportunities for entrepreneurs.  [RAD: certainly looks that way with just December and January numbers]



9. Cybersecurity managed services revenue will
grow 15% in 2024. Outgrowing overall managed services growth – and also
outgrowing the 6,500 software and hardware vendors too!



10. The three key challenges for MSPs in 2024 will
be new customer acquisition, upskilling existing staff, and transitioning their
business models. Now over a half-trillion services opportunity, MSP’s will need
to mature their business models and take advantage of the growing opportunity.  [RAD: if M&A is up and Cybersec is most of the growth, which requires special talent, how will that growth come? Combine sales issues and staffing issues, these predictions are counter-intuitive.}

Does anyone understand the MSP space in the US? Really understand who they are and what that sector of the market is? If you think MSP and immediately imagine Dimension Data/NTT, then you may not see the market from the street.  Ingram Micro has 160K global customers. Those customers are VARs and MSPs – two distinctly different business models. Microsoft says it has 62K partners in North America. So assume that there are like 65K MSPs in the US, that means 6500 of them are who the analysts are talking about, not the 58K that make up most of the market.  Even CRN can’t correctly identify an MSP:  CRN lists BCM One as an Elite 150 MSP, when in fact they are a managed SIP provider. When you look at it as data in begets the data out, I now understand the predictions. I wrote in my summary post about 2023 that most people who talk about the channel really don’t understand it — and they prove me right with each article.  

In a CCMI blog by Andrew Regitsky, the author argues that buying ISP service is not local and that 50 state laws is bad for consumers. 

Regitsky writes, Personally, I find the arguments for 50 state net neutrality laws specious.  They fail to consider the regulatory costs to ISPs that will be passed on to consumers for having to comply with 50 individual laws.” That’s the same BS we have been hearing since the telecom act went into effect! Too much regulation — but the ISPs are currently deregulated and are not subject to any regulatory costs — and the US has the most expensive broadband in the G20. Also, there is nothing innovative about the Big ISPs! Cripes, AT&T just receently stopped selling DSL; they still sell VDSL but the ADSL put forth in 1999 has just now been mothballed.

Registsky then writes, “They also assert that more laws will result in more ISP innovation.  However, that makes no sense.   Costly research and investment are easier to cost justify when a company can do so over a larger number of potential customers.  Coke doesn’t perform research on different varieties of soda to sell one flavor in New York and another in Mississippi.” Actually, that’s incorrect. Coke launches products regionally as do fast food franchises and other companies that have the data to do so. It’s also a horrible analogy because Internet is purchased locally, not nationally. It is still very challenging to buy nationwide from Comcast, Charter, AT&T and Verizon even for Fortune 5000 clients.

Further, he writes, “There are good reasons that Internet service has always been classified as an interstate service with the FCC permitted to preempt state laws that conflict with its own.” Yeah, Power.

“While it might be deeply satisfying for some folks to want to “put it to” the ISPs, in the long run consumers will lose through paying higher broadband prices and having fewer innovative services available if states control the Internet.” Does the author not understand that there isn’t competition for broadband in America? Cable owns over 60% of the market. Most consumers have only 2 possible providers – telco or cable. Companies already dealing with state and muni regulations nationwide.

The pandemic did a great job in demonstrating that broadband cap limits by cablecos were just about money; that there is a Digital Divide; and that not all internet service is equal. In fact, it so expensive to get internet that the federla government is now subsidizing it!!! THat should signal that it is a Utility and not a perk. And should regulated as such!.

Love to know what innovation and competition the author – a supposed industry expert in inter-carrier compensation, universal service and lately, Internet regulation, who swallowed too much kool-aid from his former employers – seems to think is out there.

Dialpad and T-Mobile are partnering up for biz comms. T-Mobile believes in the future of AI-powered cloud communications, and contributed to Dialpad’s Series E funding round in 2020. T-Mo also announced WFX, Home Office Internet – fixed 5G/4G broadband. 

C Spire doing FTHH in Mississippi and now Jasper, AL. [telecomp]

Star Telephone in Louisiana gets its 2nd ReConnect award from USDA. [telecomp]

RDOF winners included many WISPs — other legacy winners do not believe that these providers will be able to meet the speeds and deployment requirements.

SonicWall falls foul of zero-day vulnerability hack on own VPNs [source]

AudioCodes joins up with Twilio to offer direct routing to MS Teams. That is a crowded market – direct routing to Teams. And basically it is just dial-tone (SIP trunks) without advanced features. Not sticky. The keep is to add Value to that with IVR or voicemail or something. Business SMS – currently being touted by all Cisco powered providers – is something you can get in MS Teams with DR via SIP trunks or CPaaS. Reminder: Microsoft now offers CPaaS!

94 ISPs added wired broadband plans costing $60 per month or less during the fourth quarter of 2020, according to a new broadband price report from BroadbandNow.

Oak Hill Investment invests in CT ISP to accelerate FTTH deployment in Penn, CT and Northeast. [CV source] private capital is all over the FTTX space; UCaaS, cloud contact center and the MSP space. Monthly recurring revenue and some level of stickiness.

Bill Gates on life after the pandemic and Doug points out how this will affect ISPs [Pots and Pans]

Small business help from Intuit. Intuit has updated Intuit Aid Assist (IAA), a free website with two interactive tools to help eligible small business owners and the self-employed assess their eligibility for federal relief and related tax credits from the Coronavirus Response and Relief Supplemental Appropriations Act. The second round of PPP loans is upon us.

ISPs still suing California over Net Neutrality {ARS}

FYI… from my SBA bank on PPP Loan Forgiveness. (I have not been invited to apply for Forgiveness yet).

To give yourself a head start to the forgiveness process, these are the required documents:

• Payroll Report and Confirmation of Payments made for the Covered Period and Reference Period
• Lease Agreement and Rent Receipts for the Covered Period
• Utility Invoices and Paid Receipts for the Covered Period 
• Mortgage Agreement and Mortgage Interest Statements for the Covered Period 
• Bank Statements Covering the Covered Period 
• 2019 Filed Business Tax Return 
• Other Related Expenses for the Covered Period