Your RMM vendor just added an ‘AI-powered’ badge to their dashboard. Your PSA vendor promises ‘agentic automation.’ Your security platform claims ‘AI-driven threat detection.’
Three vendors. Three AI claims. At least two of them are probably lying.
Not lying in the way that gets you a refund. Lying in the way that gets you a product that does the same thing it did last year, with a new label and a higher price.
Welcome to AI-washing. It is the new snake oil, and it is everywhere in the MSP vendor ecosystem.
What AI-Washing Actually Looks Like
The term ‘AI-washing’ refers to companies exaggerating or fabricating the role of artificial intelligence in their products. It is not new — the SEC flagged it as an enforcement priority in 2025, and the FTC has already pursued companies for misleading AI claims. But in the MSP vendor space, it has reached epidemic proportions.
Here is what it looks like in practice:
The ‘AI Toggle’ Vendor. Your PSA vendor adds a ‘smart classification’ button. Behind the scenes, it is a rules engine that matches keywords to categories. It has been doing this for five years. The only thing new is the label.
The ‘AI-Powered Summary’ Vendor. Your RMM tool now offers ‘AI-generated alert summaries.’ What it actually does: it takes the alert text and rephrases it using a template. No reasoning. No context. No learning. Just a thesaurus with a marketing budget.
The ‘Agentic AI’ Vendor. This one is harder. They use the language of autonomous agents — ‘perceives, reasons, acts, learns’ — but the actual product requires so much human configuration and oversight that ‘agentic’ is doing more work in the marketing deck than in the software.
Why This Matters Beyond the Buzzword
AI-washing is not just an annoyance. It has real consequences for your MSP.
You make buying decisions based on false promises. If you choose Vendor A over Vendor B because of their ‘AI capabilities,’ and those capabilities do not exist, you have wasted budget and lost time. The average MSP juggles 10 to 25 tools. Every bad purchase displaces a good one.
You overpromise to your clients. When your vendor tells you their tool does X, and you pass that promise to your clients, you own the gap when it does not deliver. The ChannelPro Network published a guide in late 2025 on MSP liability for marketing promises — if you claim it, you may be on the hook when it fails.
You fall behind MSPs who see through the hype. The data is clear: MSPs deploying real AI automation report net margins of 28 to 32 percent, compared to 11 to 15 percent for non-adopters. But ‘deploying real AI’ means knowing what is real. The MSPs who buy the hype and get the label are falling further behind, not catching up.
The Two Tiers of AI in the MSP Market
The market has split into two distinct segments, and understanding the difference is the first step to cutting through the noise.
Tier 1: Point solutions with AI features. These are existing tools — your RMM, your PSA, your documentation platform — that have added AI capabilities as feature additions. They deliver incremental improvements. A ‘smart’ ticket classifier that gets 80 percent accuracy. An alert summarizer that saves a few seconds per ticket. These are real, but they are not transformative. They are the equivalent of adding a turbo badge to a car that still has the same engine.
Tier 2: Purpose-built AI platforms. These are systems designed from the ground up for autonomous operation. They do not just classify tickets — they triage, dispatch, resolve, and document. They do not just summarize alerts — they correlate, prioritize, and recommend action. They learn from your environment and get measurably better over time. A system that starts at 85 percent triage accuracy reaches 95 percent within 90 days as it absorbs your specific patterns.
The MSPs seeing the strongest results have moved beyond Tier 1 to Tier 2. The majority of the industry is still buying Tier 1 and calling it transformation.
Five Questions to Ask Any Vendor Claiming AI
Before you believe any AI claim, ask these five questions. The answers will tell you everything.
1. What specifically does the AI do that your product could not do before? If the answer is vague — ‘it makes your team more efficient’ or ‘it reduces response times’ — press for specifics. What exact task? What exact improvement? What exact measurement? If they cannot answer with numbers, they are selling a label.
2. Can I see it work on my data, in my environment, for 30 days before I commit? Real AI handles real data. If a vendor will not let you test with your own tickets, your own clients, your own configurations, they are either not confident in the product or the product is not designed for your reality.
3. What happens when the AI is wrong? Every AI system makes mistakes. The question is what happens next. Does it escalate to a human? Does it learn from the correction? Does it log its reasoning so you can audit the decision? A vendor who says ‘the AI is always right’ is a vendor who has never deployed AI in production.
4. How does it integrate with my existing stack? AI that lives in a silo is AI that creates more work. If the AI tool requires manual data entry, separate logins, or does not write back to your PSA, it is adding friction, not removing it. Purpose-built platforms integrate deeply with the tools you already use.
5. What does the learning curve look like? Real AI requires configuration, tuning, and a learning period. Vendors who promise ‘zero-effort implementation’ are either oversimplifying or selling a basic rule engine with an AI label. Plan for 2 to 4 weeks of active tuning. If they promise less, be skeptical.
What Real AI Looks Like in Practice
To be clear: real AI exists, and it is delivering real results for MSPs. Here is what it looks like when it is working.
Automated ticket triage at 95 percent accuracy. Not keyword matching. Actual classification that understands context, urgency, and client history. Processing time: under 2 seconds per ticket. Result: zero backlog accumulation during peak periods.
Intelligent dispatch that gets it right the first time. Matching tickets to the optimal technician based on skills, workload, availability, SLA requirements, and client relationship history. Result: 70 percent reduction in ticket reassignments — eliminating one of the most persistent sources of delay and frustration.
Autonomous resolution for routine issues. Password resets, account lockouts, permission changes, basic software issues — resolved without human intervention. Not hypothetical: production deployments are processing thousands of tickets per month with 40 to 60 percent autonomous resolution rates.
Documentation that writes itself. Ticket notes, resolution summaries, and knowledge base entries generated as a byproduct of normal operations. No extra work from technicians. Consistent, comprehensive documentation that improves every downstream process.
These are not future promises. They are current capabilities, deployed today, in MSPs of various sizes. The gap between MSPs using this technology and those still buying AI-labeled point solutions is widening every quarter.
The Regulatory Reckoning Is Coming
The SEC has made AI claims an examination priority. The FTC has already pursued companies for misleading AI marketing. Legal experts are now advising companies to audit their AI claims the same way they audit financial statements.
For MSPs, this means two things. First, the vendors making inflated AI claims are going to face pressure — and when they do, the cost of compliance will be passed to you in price increases. Second, if you are making AI claims to your clients based on vendor promises, you may be exposed. The ChannelPro guide on MSP liability for marketing promises is not theoretical. It is a preview of where this is heading.
The safest position is to be honest. Tell your clients what your tools actually do. Show them the results. Let the work speak for itself.
The Bottom Line
Is Your Vendor’s “AI-Powered” Claim Worth Believing?
AI-washing works because it exploits a real desire: MSPs want to be more efficient, deliver better service, and stay competitive. Those goals are legitimate. The problem is not the aspiration — it is the shortcut.
The MSPs who will win in 2026 and beyond are not the ones who buy the most AI-labeled tools. They are the ones who ask the hardest questions, demand proof over promises, and invest in technology that delivers measurable results.
When a vendor says ‘AI-powered,’ your next question should be: ‘Prove it.’ If they cannot, you have your answer.
About the Author
Brent Lacy has spent nearly 30 years in the IT industry building and advising managed service providers. He is the author of Rewired MSP: Mastery, Scalability and Performance, vCIO Rewired: Virtually Conquering IT Obstacles, and Near Miss: Preventable IT Failures Threatening Your Business Security.
