Here Are What 20 MSP 500 Executives See As The Biggest Challenges To Their Business In 2025
We asked top MSP executives to tell us what they see as the biggest challenges to their managed services businesses this year. From the uncertain economy and difficulty in hiring skilled employees, to industry consolidation and margin pressure in the competitive MSP market, and ito ncreasingly sophisticated cybersecurity threats, here’s what 20 MSP executives said is keeping them awake at night.
Uncertain Times
Managed service providers entered 2025 facing a growing number of challenges. Some are issues they have faced for years, including squeezed profit margins and difficulty in hiring skilled workers. Others are more recent, such as developing in-house skills and services around AI to meet surging customer demand.
As part of the CRN 2025 MSP 500, we asked top MSP executives to tell us what they expect to be the biggest challenge to their managed services business in 2025. All responses to the emerging technology opportunity question can be found as part of the MSP 500 profiles.
A number of MSP executives cited economic uncertainty, tariffs and potential supply chain issues as concerns. Some worried about ongoing consolidation in the MSP industry while others noted that low-cost/low-value service providers are putting pressure on profit margins even as MSPs try to maintain a high level of service. And some pointed to the growing number, variety and complexity of cyberthreats as a challenge.
Many MSPs see AI as a significant opportunity. But some see downsides in that they face pressure to quickly develop AI skills and services to meet client expectations. And AI is contributing to cybersecurity threats as the bad actors use AI to develop new ways to launch cyberattacks.
Some MSPs even cited the challenge of automating customer support processes —critical to keeping costs down—without losing the high-touch component of customer relationships that can be a competitive differentiator.
The following is a sampling of responses from 20 MSP executives to the question: What do you expect to be the biggest challenge to your managed services business for 2025?
1Path
James Hwang, CEO
Atlanta
AI and automation tools are transforming IT services, but MSPs must balance leveraging these technologies with retaining a human touch. The challenge lies in reskilling teams, maintaining personalized service and leveraging AI solutions without overautomating customer interactions.
Accent Consulting
Phil Wright, Founder, CEO
Torrance, Calif.
The biggest challenge for 2025 will be balancing the integration of AI technologies with maintaining the human touch in managed services. Ensuring seamless adoption, managing data security and addressing evolving client expectations will be critical as we leverage AI to enhance efficiency without compromising personalized, high-quality service delivery.
Align Managed Services
Vinod Paul, President
New York
The biggest challenge for Align in 2025 will be adapting to the rapid pace of technological advancements while ensuring robust cybersecurity protections and compliance with evolving regulations. As we continue serving the financial services vertical, we must balance innovation with risk mitigation to support our clients’ success and regulatory obligations.
Bridgenext
John Castleman, CEO
Jacksonville, Fla.
The competitive landscape for quality resources continues to be the largest challenge. Finding and recruiting candidates with the right skills to meet client demand is critical to success. We are also keeping an eye on the economic climate, which could impact investments in outsourced projects and managed services.
Computer Resources of America
Chico Ramnarayan, Founder, CEO
New York
The biggest challenge to our managed services business in 2025 will be addressing the rapid evolution of cybersecurity threats while meeting increasing client expectations for faster, more personalized IT support. Balancing cutting-edge technology adoption with maintaining cost efficiency will be critical to staying competitive and delivering exceptional service.
DALY
Ryan Yu, President
Frederick, Md.
Slow adoption of the managed services model by the SLED market.
The Fulcrum Group
Steve Meek, President
Keller, Texas
Transitioning internal staff skill sets from traditional server infrastructure to cloud-based, AI and managed cybersecurity needs.
ISSQUARED
Bala Ramaiah, CEO
Westlake Village, Calif.
In 2025, the biggest challenge to managed services will likely be tackling cybersecurity threats, managing rapid AI and cloud advancements, seamless integration of emerging technologies and addressing talent shortages.
Keep IT Simple (KIS)
Sean Canevaro, CEO
Fremont, Calif.
In 2025 challenges in receiving technology hardware for our managed services business include ongoing global supply chain disruptions, semiconductor shortages and increased demand outpacing production. Delayed shipments and rising costs may affect project timelines and profitability. Strategic vendor partnerships and proactive inventory management will mitigate these challenges.
MicroAge
Rob Zack, CEO
Phoenix
The biggest challenge for our managed services business in 2025 will remain the increasing competition. As the market evolves and new players emerge, differentiating our offerings and maintaining a competitive edge will be key to our success.
NetGain Technologies
Hank Dallam, CEO
Lexington, Ky.
Hiring and retaining top talent. IT is a competitive market for hiring technology professionals, especially those with several years of experience and the certifications/skills that fit our tech stack.
Nucleus Networks
Karl Fulljames, CTO
Vancouver, B.C.
The biggest challenge remains remaining competitive in our current markets and growing MRR [monthly recurring revenue] in new regions. In order to remain competitive, we must ensure a high level of customer satisfaction as measured by NPS and KPIs on our help desk.
Peak UpTime
Gordon Martin, President
Tulsa, Okla.
The biggest challenge for our managed services business this year will be to find innovative ways to keep our clients and prospects abreast of all the changes in the industry without overwhelming them.
Pileus Technologies
John Douglass, President
Wichita, Kan.
Consolidation of the channel. The amount of M&A going on is crazy. Between the partners that we use every day, along with the PE [private equity] scooping up MSPs and MSPs merging to create larger entities, we have to keep on the upside more now than ever.
Rudick Innovation and Technology
Chris Wilson, CTO
Dallas
We anticipate the political landscape will be the biggest challenge to our managed services business.
RSM US
Patrick Vance, Consulting Leader
Chicago
As clients adopt hybrid cloud environments, increasing complexity demands technical expertise and industry-specific knowledge. Regulatory requirements like HIPAA, CMMC and PCI DSS add to the need for specialized training. To ensure consistent, high-quality service and client satisfaction, RSM aligns support teams by industry to address unique challenges effectively.
SolCyber
Scott McCrady
Dallas
In 2025, our biggest challenge will be standing out in a saturated market where direct vendors, tool overload misconceptions and FUD hinder understanding of effective cybersecurity. Many frustrated clients resist change, viewing it as too complex. Addressing these requires clear differentiation, education and a consultative, human-led approach to security.
TechPulse
Christopher Scaminaci, VP, Engineer
Youngsville, La.
Economic recession.
Weidenhammer Systems
John Weidenhammer, CEO
Wyomissing, Pa.
Cybersecurity threats: As MSPs and their clients grow, cyber threats will evolve to be more complex.
Client acquisition and retention: Value-added services will be necessary to attract and retain new clients.
Compliance and regulation: Industry-specific regulations have more clients asking for help with maintaining compliance standards.
GuidePoint Security
Michael Volk, CEO
Herndon, Va.
The macroeconomic climate, combined with geopolitical factors, means many organizations will need to continue doing "more with less" in terms of security, all while security threats continue to grow.
