In recent months, the MSP community has been flooded with talk about AI by customers, competitors, and vendors alike. In the latter half of 2025, Pax8 even coined anew term, ‘The Managed Intelligence Provider’: a strategic AI partner responsible for orchestrating, implementing, and optimizing custom agentic intelligence solutions.
There is no denying that the demand for AI is strong, but AI is still very much in its emergence and the services MSPs offer should reflect this.
Is the Managed Intelligence Provider really the next stage in the MSP evolution? Is the market actually ready for these complex agentic solutions? Does ‘Managed Intelligence’ really need to be the next priority for MSPs? What does delivering AI actually look like at the moment as an MSP?
We break down all these questions and more to help you start deciding how to incorporate AI into your service offering in an effective, valuable, and profitable way.
Long story short, small and medium-sized businesses (SMBs) want AI. They’ve been sold the AI dream, and much of it is true. The productivity potential of AI is undeniable when used right.
According to Pax8, 75% of SMBs are already experimenting with, and putting money into, AI. Microsoft reports that 70% of employees say they would delegate as much work as possible to AI if it meant lightening their workload, while Salesforce state that 78% of users using or planning to use AI view it as a game changer.
Perhaps for the first time ever, SMB demand is shaping the direction of MSPs. As this demand rises, you need to know how to support your SMB customers, and enable them to use AI effectively, productively, and most essentially, securely.
Most MSPs are already aware of this growing demand and want to respond. In January 2026, inforcer hosted a panel of MSPs of different sizes, serving a wide-range of end customers. Each and every one of them stated that delivering AI support was a priority for their business in 2026. This is reflective of the wider MSP market. According to Opentext, 96% of MSPs believe that AI interest will drive business growth this year and 92% of MSPs indicate that business expansion is already being primarily propelled by an increased interest in AI.
While the ‘Managed Intelligence Provider’ is still more of a buzzword than a reality at the moment, MSPs are aware that they need to respond to the demand for AI, or risk being left behind.
With or without the support of their MSPs, SMBs are using AI. Similarly, individuals are using AI with or without the approval of their organization. Using personal AI for business functions is problematic to say the least.
Shadow AI, the unapproved use of AI tooling at work, is posing a huge threat to organizations. MIT reports that 90% of companies used reported regular use of personal AI tools for work tasks, which places them at significant risk of data breaches. In fact, IBM has reported that 35% of breaches this year involved data stored in unmanaged or ‘shadow’ data sources. MSPs need to be aware of these risks and help companies monitor for and prevent shadow AI.
Offering a viable AI alternative is obviously key to this. And that’s where Copilot comes in. Copilot helps to combat the risks of shadow AI as it is an isolated instance of AI per business. It is purpose built for business use, integrating directly into an organization’s Microsoft 365 environment. Any security-conscious MSP should be recommending Copilot over open-source AI tools. Remember, it’s you that your customers will look to when they face a breach, asking ‘why didn’t you warn me?’ and ‘why didn’t you prevent this breach?’
SMBs might be attracted to the productivity and efficiency benefits of Copilot but, traditionally, they have been put off by the price point. However, Microsoft has now made Copilot more accessible to the SMB.
Copilot Chat, a chatbot version of Copilot that does not integrate into a business’ Microsoft 365 environment, is available completely for free. In November 2025, Microsoft also released Microsoft 365 Copilot Business, a version of Copilot designed for businesses with fewer than 300 users, which is available at a lower price point.
Microsoft has bundled Copilot Business with existing qualifying Microsoft 365 Business plans to simplify purchasing for SMBs and increase value. They are also running promotions in the first quarter of 2026 which help to reduce adoption costs even further.
On top of increasing its affordability and accessibility, Microsoft is now marketing Copilot directly to SMBs. It’s only a matter of time before customers start asking you about the Copilot – if they haven’t already. Don’t risk looking reactive. If you want to position yourself as a reliable and trusted AI advisor, you need to start talking to your customers about the benefits and potential use cases of Copilot sooner rather than later.
SMBs might want AI, but their AI usage is still actually quite immature. In fact, only 9% of businesses already using AI are currently using agents, and only 1% of C-suite respondents in a McKinsey study would describe their gen AI rollouts as mature.
In other words, there’s no need to panic and start overhauling your service offerings overnight. Most MSPs don’t have the internal expertise and resource to start building and delivering AI agents at scale at this point – and that is completely alright.
What SMBs need is direction about how to prepare for and use AI. Start with the basics of Copilot readiness and enablement and build up from there.
You can actually build a lot of Copilot readiness and enablement services on top of the cyber security and advisory services you are already delivering.
When building out an initial Copilot service, you should consider the following three steps.
Before you can roll out Copilot with any customer, you need to ensure that they are both mature and secure enough to benefit from it. To assess Copilot readiness, you need to first audit the tenant. Assess whether your customers are using their Microsoft 365 environments to their full potential, identify potential power users who can lead adoption, and identify any security vulnerabilities or data governance issues. You need to assess whether there is a business case for Copilot roll out and whether you need to help them mature further before they will truly benefit from adoption.
Tenant security and data governance need to underpin anyCopilot service. You can integrate existing cyber security and data governance best practices into a Copilot readiness offering to ensure that rollout is fully secure.
Ensure customer data is centralized, organized, and well-structured, data access permissions have been reviewed, and appropriate controls have been enforced. If you identified any vulnerabilities or misconfigurations during your tenant audit, ensure that these have been remediated before you think about Copilot adoption, so you are delivering AI on top of a fully secure, well-configured tenant.
As you begin to cautiously explore Copilot services, advisory services could be a good place to begin. Help customers identify opportunities for AI in their business, suggest specific departments and individuals who could benefit most, help them develop Copilot roadmaps, and report on the value seen from Copilot roll out.
Of course, if your customers are less mature, these advisory services could start with helping them use more areas of Microsoft 365, secure their tenant effectively, and centralize, organize, and orchestrate their data properly.
Looking for more information about how to deliver effective and profitable Copilot services in the current landscape? Download our guide to debunk the hype surrounding ‘Managed Intelligence’ and gain practical strategies and insights you can use today.