Managed Services

Nerdio CEO: The MSP Opportunity in AI, Microsoft Copilot

Generative AI offers a tremendous opportunity for managed service providers to manage and build new services for their end customers. But so far, the realization of those opportunities has been limited.

ChannelE2E spoke with Nerdio CEO and co-founder Vadim Vladimirskiy to get his perspective on the potential opportunities for MSPs in the age of generative AI and AI assistants, the promise of Microsoft-copilot, what he thinks about Amazon’s recent purchase of a million Microsoft 365 licenses, and more.

But first some background. Vladimirskiy’s company Nerdio offers a platform for MSPs to manage virtual desktop environments in Microsoft Azure. The company expanded in April with additional automation and cost-optimization as well as support for Microsoft Intune – a tool that could be a big disruptor of a standard MSP tool RMM (remote monitoring and management), because it takes over some of RMM’s tasks. Nerdio also offers a free MSP tool to help MSPs quote and cost-predict Microsoft Azure licenses and margins prior to deployment.  

Here's some of what Vladimirskiy told us about his perspective on generative AI trends, how MSPs can capitalize, and the future of the Nerdio platform.

What’s the opportunity for MSPs when it comes to Microsoft Copilot?

Nerdio is seeing interest from both its enterprise and MSP customers on Copilot, and it makes sense for some large enterprise customers. Microsoft’s terms for Copilot make it so that only the very largest companies can currently take advantage of general availability. The licenses are $30 per user with a minimum of 300 licenses, and there’s a time commitment, too.

It’s possible that Microsoft will release something more geared toward the lower end of the market in 2024. However, Vladimirskiy said, there isn't much that needs to be managed when you have just an out-of-the-box, Microsoft 365 Copilot that can interact with your Microsoft 365 data – Word, Excel, PowerPoint, Outlook, SharePoint. In those terms, the MSP opportunity may only be educating the market -- enabling them and training them on the technology best practices.

However, there’s a bigger opportunity down the road in terms of data management projects and ongoing management that Vladimirskiy believes will be a sweet spot for MSPs. That sweet spot will be integrating all data from non-Microsoft applications into Copilot. End customers are likely to see huge value in being able to query Copilot on questions related to their enterprise data. For instance, what if a CEO could ask Copilot the questions he or she would normally ask the CFO?

Vadim Vladimirskiy, CEO, Nerdio

“If Copilot has access to your data, it should be able to answer those questions,” Vladimirskiy said. “That’s a big opportunity for MSPs.

To help organizations integrate their data, Microsoft has released Microsoft Copilot Studio which enables integration of an organization’s data into Copilot. It’s too complicated for an end-user company to do on its own and easy enough for an MSP company to do as a service for an end-user company, according to Vladimirskiy.

“You can use the Microsoft building blocks, their SaaS engine, and their AI components, and then connect them to the data using the data connectors that those service providers are going to publish to Microsoft. Then you can provide it to your customers as a managed solution,” Vladimirskiy said.

What’s the AI opportunity for Nerdio in the MSP market?

Nerdio is not ready to announce anything in this area right now, but Vladimirskiy provided some hints about where he thinks Nerdio can help MSPs get up to speed with generative AI.  For instance, the cost of Copilot itself, at $30 per user, is pretty high for the SMB market, and there wouldn’t be much if any room for an MSP resale mark up on that price. But what if Nerdio deconstructed the Copilot solution, which is built using Open AI’s foundational models and Microsoft’s Azure infrastructure running in AI-silicon equipped data centers?

Vladimirskiy envisions a service that is built using the same components but sold on a consumption basis instead of the per user/per month basis.

“Envision the MSP offering their customers a cost effective way of doing AI that’s based more on usage and consumption rather than a premium per user/per month price,” he said.

Is that what Nerdio is planning? That’s not quite clear yet.

“We’re exploring the possibilities,” Vladimirskiy said. “In enabling MSPs to build not just successful cloud practices but build successful cloud practices with  AI capabilities within their MSP practices.”

What about Nerdio’s non-AI MSP business?

Nerdio’s MSP business offers a broad management suite of tools around the entire Microsoft Cloud, including virtual desktops, Azure, and Microsoft 365. But the company is also moving more into security and working with Microsoft Defender, Intune and similar products.

Any thoughts on Amazon buying one million Microsoft 365 licenses?

Amazon is said to be spending $1 billion on a million Microsoft 365 licenses, an interesting development when you consider that these two companies are pitted against each other in the cloud hyperscaler market. Vladimirskiy said he got a lot of questions about this when it was first revealed in October. People wondered if Microsoft and Amazon were going to collaborate on services offered to customers. But what the deal actually seems to be about is that Amazon, as an organization, has employees that need productivity and collaboration software.

“Amazon is just purchasing the productivity software that really most of the rest of the world already uses,” Vladimirskiy said. “It doesn't seem to be so much about any collaboration at the services level that would impact and customers or impact MSPs or channel partners of Amazon.”

What does Vladimirskiy think of Microsoft’s AI efforts?

Vladimirskiy said he recently attended Microsoft Ignite and, “Everything was about AI. AI was the undeniable central theme of everything. Microsoft is incentivizing their internal teams and focusing on AI to a really large extent. They've announced some custom hardware that they've actually built to enable themselves to scale they are building data centers because of how power hungry AI is, and for the type of hardware and chips that they need. Microsoft is building custom silicon to run AI workloads which was surprising but makes total sense in that they want to chart their own destiny maybe in parallel with Intel and Nvidia specifically.”

How would Vladimirskiy use Copilot?

He doesn’t have Copilot yet himself, but he can imagine how useful it would be to him.

“I came in this morning after a meeting to an inbox of 60 emails. And I'm still sitting here and trying to figure out what's relevant. What am I going to push off until tomorrow? What am I going to deal with immediately? It would be great if -- even without me asking -- my Copilot would tell me: ‘Hey, you know, ignore everything else until the afternoon and focus on these two right now.’ And it can do that. You can ask, ‘what should I focus on within my inbox today?’ Can you imagine the power and efficiency you can drive with that?”

Jessica C. Davis

Jessica C. Davis has spent a career as a journalist and editor covering the business of technology including chips, software, the cloud, AI, and cybersecurity. She previously served as editor in chief of Channel Insider and later of MSP Mentor (now part of Channel Futures). She was a key editor in the original MSP 501 list. She now serves as editorial director for CyberRisk Alliance’s channel brands, MSSP Alert and ChannelE2E.