Fresh analysis from Omdia out yesterday looked at 169 MSP M&A deals (mergers and acquisitions… or murders and executions, if you’ve watched American Psycho) completed last year. And there’s a pattern.

Seventeen of those deals involved MSSPs. This was either MSSP’s acquiring competitors or MSPs acquiring security specialists to embed cybersecurity directly into their portfolio.

The conclusion: Cybersecurity is increasingly expected within a managed services contract. Omdia

The other big trend: Private equity-backed platforms are getting more strategic, moving beyond geographic scale to add ERP expertise, vertical specialisation, and AI-driven delivery models. Omdia

What does this mean for you? Well, if consolidation is being driven by buyers who want specialist capability, generalist MSPs without a clear niche maye find themselves either acquired for less than they hoped. Worth thinking about where your defensible territory is.

🟡 A UK MSP just doubled down on data infrastructure

Staying with murders… mergers and acquisitions…. Everything Tech Group, a Manchester UK based MSP founded in 2021, this week snapped up Nexstor, a Nottingham-based specialist in business-critical data platforms.

The deal adds £15m in revenues and 27 employees to Everything Tech’s headcount, taking the group to over 150 people. Nexstor brings specialist depth in data infrastructure and hybrid cloud… areas Everything Tech didn’t previously cover with its own dedicated unit. IT Channel Oxygen

That’s nine acquisitions in four years for a business that was turning over £17m in 2024. Founder Mark Allen previously built GCI to a £197m enterprise value through 27 acquisitions. So he knows exactly what he’s doing.

If you’re thinking about M&A as either a buyer or a seller, this is the blueprint: Acquire specific capability gaps, not just revenue.

🟢 Client budgets are under pressure… which is actually good for MSPs???

The IMF published its updated World Economic Outlook this week, and the headline is gloomy: The Iran war has stalled global economic momentum, pushing growth lower than expected in 2026 and creating inflationary pressure through rising energy costs. Washington Times

Before that makes you click off and go get another coffee, here’s why that’s actually not bad news for you specifically. When businesses feel the economic squeeze, the first instinct is to look at where they can cut costs without cutting capability. Outsourcing IT, rather than maintaining expensive in-house teams, looks increasingly attractive in exactly this environment. You become the answer to their problem, not a line item to cut.

The MSPs who’ll struggle are the ones positioned purely as a cost. The ones who’ll thrive are positioned as a solution. Big difference.

Right, have a good weekend. We’ll be back on Monday morning. Enjoy.Here’s today’s completed newsletter. Notice a few things:

1. I’ve removed all the em dashes. You’ve really got to get rid of those.

2. I have removed the scary, interesting, and reassuring from the three headlines. You don’t need those every time. Analyse this to see what else I’ve changed and learn from that, because we’re going to be doing this five days a week going forward.

If you’ve got hardware refreshes coming up for clients in the next six months, probably best to talk to them now. Because when the invoice arrives, they’re going to need to have a good sit down. Maybe even a shot of vodka.

IDC is projecting average PC prices will increase 15-20% in 2026. Teal

The culprit is, of course, memory. Up to 70% of global memory production is now directed toward AI data centres, leaving just 30% for, y’know, the stuff we use every day… PCs, servers, and everything else. Teal

Add tariffs on top, and you’ve got a proper squeeze. Gartner’s analysts describe the supply constraint as structural and persistent, not cyclical, meaning it could potentially last well into 2027. Computerworld

So this isn’t a blip. It’s the new normal… at least for a while.

A suggested practical move: get quotes locked in now, have the budget conversation with clients before they see prices go up, and consider whether any refresh cycles can be pushed or whether kit can be life-extended.

Clients who went through Windows 10 end-of-life without upgrading are going to feel this hardest. Yes, you and I both know… you told them!!

🟡 Use AI to expand your margins and remove friction

The real opportunity for MSPs isn’t selling AI to clients, it’s using AI internally to expand margins, eliminate daily friction, and deliver consulting services without losing the recurring revenue model underneath.

That’s what Kaseya’s EMEA boss Dermot McCann said at an event in London this week. IT Pro

The warning he attached to that: the threat landscape right now is a “hacker’s dream,” with AI-generated phishing now the baseline for attackers, not an advanced technique. IT Pro

So the same technology that helps you scale is also helping the people trying to breach your clients. Something to keep front of mind.

🟢 This is reassuring… the IT spending tap is still on

With the Iran conflict, tariff chaos, and memory shortages all making headlines, it would be easy to assume businesses are freezing IT budgets.

Global IT spending was forecast to hit $6.15 trillion in 2026 before the conflict broke out. IDC has since cut its growth forecast. But there is some good news. Analysts say AI investment is cushioning the blow. Computerworld

Managed services specifically continues to grow (woohoo!). The businesses that need help managing increasingly complex environments aren’t suddenly going to stop needing that help just because oil prices are high. If anything, when budgets get squeezed, outsourcing looks more attractive, not less.

See you tomorrow, bright and early. Don’t worry, it’s nearly the weekend 😃

Microsoft has hit the alert button about a threat actor called Storm-1175. And if you run ConnectWise ScreenConnect, SimpleHelp, AnyDesk, or Atera, you need to read this.

The Storm-1175 group exploits vulnerabilities in internet-facing systems, sometimes before those vulnerabilities are even publicly disclosed. They can move from initial access all the way to Medusa ransomware deployment within 24 hours. Microsoft

Their victims so far: healthcare, education, professional services, and finance organisations across the UK, US, and Australia.

The nasty twist? They use your own RMM tools to hide inside your network, blending malicious traffic into platforms you already trust. Smarter MSP

Which means detection is genuinely hard.

If you haven’t patched ScreenConnect, SimpleHelp, or GoAnywhere recently, that’s your job for today. Crack on.

🟡 What happened in Vegas doesn’t stay in Vegas

Channel Partners Conference & Expo and MSP Summit 2026 ran this week in Las Vegas. Thousands of MSPs and vendors were there. Were you? Business Wire

The theme was “Channel Velocity”, which basically means everyone’s trying to figure out how to move faster with AI before their competitors do.

The honest summary: Lots of noise, but the signal is consistent. MSPs who aren’t actively building AI into their service delivery are already falling behind the conversations happening in the room. The question being asked wasn’t “should we do AI?” It was “when should we build custom AI tools versus buy them?”

Worth watching for coverage coming out of this over the next few days.

🟢 Finally some good news on salary costs KERCHING

Four years on, the salary arms race of 2022 is officially over. New data from ConnectWise’s 2026 compensation report shows wage inflation has cooled significantly, with nearly half of MSP employers planning salary increases of just 0.1–3% this year. MSP GLOBAL

O.1%. What’s that, $30 a year? Try to keep a straight face while telling your tech that news.

The more interesting finding: the best-performing MSPs aren’t the highest-paying ones. MSP GLOBAL

The top quartile by profitability actually pays less in fixed salaries and more in variable incentives. Which means the winners are structuring their businesses smarter, not just spending more.

See you tomorrow, bright and early.