As I peer into my crystal ball for 2023, I see three topics of particular interest to the SMB market. Cybersecurity has never been more important, and there are a couple of reasons I think we should pay attention to it next year. Even though the pandemic is mostly behind us at this point, things like work from anywhere, supply chain issues, and aging on-premises servers are leading to problem that will need to be solved. Lastly, AI seems to be taking center stage just recently with the text generating tools like ChatGPT. How will these situations and technologies affect SMBs in 2023?
Cybersecurity insurance is important for small and medium-sized businesses (SMBs) for several reasons. Firstly, it can help protect SMBs from financial losses due to cyberattacks, such as the cost of investigating a breach, paying for credit monitoring services for customers, or legal fees if the business is sued. Secondly, it can help SMBs recover from a cyber-attack by providing access to cybersecurity experts who can help them restore their systems and get back to business as quickly as possible. Finally, having cybersecurity insurance can also help SMBs demonstrate to their customers that they take their data security seriously, which can help to build trust and confidence in the business.
The role of managed IT services providers is broad and because of that breadth, they can sometimes take on significant liability. One of the best ways to reduce the risk associated with that liability is for their clients and themselves to be adequately insured. There are MSPs I talk to who will not take a new client if they do not carry sufficient cyber insurance. Managing a client’s IT is a business solution not just a technical one. On the flip side of that, many service providers believe it is not their place to dictate those types of terms. To that I will simply say that the risk exists either way; how you deal with it is up to you. Maybe you charge more to increase your own coverage or just charge more as a reward for the risk. There are many options to handle the risk, but a few things are certain …
- Cyberattacks are only going to continue to increase amongst SMB as it becomes increasingly profitable to do so.
- Cyberinsurance is the best way for the client to be protected from business losses due to an incident.
- If you claim to “manage” their IT, you are assuming some degree of risk.
A few more factors making this something to watch in 2023 is the fact that even with dramatic increases in cyberinsurance over the past two years, we seem to be seeing a stabilization in price. Requirements for writing or renewing a policy have gone from one page to many, this is an opportunity for MSPs to create offerings around the initial qualification and ongoing monitoring of those requirements. I don’t know about you, but if I was still an MSP owner, one of my worst nightmares would be a client having an incident and their policy not paying out because one item on that list had fallen out of compliance. Did you know that in 2021, 25% of cyberinsurance claims were not paid due to an unmet requirement? Another factor that will play a part in the insurance equation is certifications. I think that insurance companies are desperate to find a standard to hold their customers (and their customers’ IT providers) to. CompTIA has just announced their new Cybersecurity Trustmark, scheduled to be launched officially in March of 2023. CompTIA hopes the new program will help providers and their clients obtain the right policies and, perhaps, qualify for lower premiums and higher limits.
One lagging issue caused by the pandemic for SMBs is a large number of aging on-premises servers. These servers are hanging on by a thread due to conservative spending during the pandemic combined with post-pandemic supply chain issues. Now the recession warnings have caused a squeeze on spending as well. Even if an SMB is aware of the risk of not replacing the old hardware and they have the funds to do so, they are being cautious of Capex spend because of the current economic climate. Therefore, we see an uptick in moving many server roles to cloud-based solutions for applications, identity management, file sharing, and more. This is an opportune time for MSPs to build out a cloud-based, virtual office solution for clients. CompTIA data from their 2022 Trends in Managed Services Report showed that 70% of client relations improved with cloud adoption and that 75% of the time, it positively impacted revenue. SMBs are becoming more comfortable with the cloud, and now is the time to have an offering that works for those clients.
Lastly, and most surprising to me, is the rapid pace of AI into actual work product. The best example, and where I think it is going to make the biggest mark with small businesses first is with marketing. If you have not played with ChatGPT by OpenAI, I encourage you to do so. The quality of generated copy is amazing, and it fills a need that many small business owners have. There are existing services that create good copy for advertising, social media and anywhere written copy is needed. I think it’s only a matter of time before someone creates a service that can create social media posts unique to an individual business that incorporates current trends to create copy and imagery and then posts it automatically. I potentially see a downside to this as well when we start to see spamming on our social media feeds. The smart algorithms will keep this at bay so that we appreciate the results rather than despise them. The challenge here is for the MSP to find a way to monetize this as an offering to their clients.
Those are my three trends to look out for in 2023. I think they each represent an opportunity for the MSP and necessary solutions for their clients. I hope that 2022 has been good to you and that 2023 is even better.