The commoditization problem in MSP security 

Why is the managed services market becoming harder to compete in? 

The managed services market is crowded. Competing on endpoint protection, backup, or basic monitoring means competing on price against dozens of other providers. 

Key challenges MSPs face: 

• Margins compress as clients shop services against similar alternatives 

• Clients see MSPs as interchangeable commodities 

• Differentiation based on traditional IT security is nearly impossible 

• Price becomes the primary decision factor 

If you want to break out of that cycle, you need to offer something your competitors cannot easily replicate. You need differentiation that matters to clients and creates defensible competitive advantage. 

OT security is that something. 

Why OT, why now: Three market forces 

Why is OT security moving into the MSP market now? 

Operational technology security has been the domain of specialists for years. Vendors like Claroty, Dragos, and Nozomi built their businesses serving large enterprises with dedicated OT security teams and seven-figure budgets. 

But three forces are pushing OT security into the mid-market where MSPs operate, creating the MSP OT opportunity that defines 2026. 

1: Smart buildings are everywhere 

The smart building reality: 

• Commercial real estate facilities have networked building management systems 

• Healthcare facilities operate connected medical devices and building automation 

• Retail stores deploy integrated HVAC, lighting, and access control 

• Warehouses run automated climate control and inventory systems 

• Hotels implement building-wide integration for guest services 

What used to be standalone equipment running in isolation is now connected to networks, remotely controllable, and hackable. Building management systems, access control platforms, HVAC controllers, and video surveillance create attack surfaces that did not exist a decade ago but are now ubiquitous. 

2: Attackers are targeting building systems 

Attack trend data: 

• Building systems are now the third most common ransomware target (behind traditional IT and healthcare) 

• Ransomware gangs discovered that locking HVAC or access control creates immediate pressure to pay 

• Payment rates for building system ransoms exceed traditional IT ransoms 

• Operational impact is immediate - buildings become uninhabitable when BMS is encrypted 

When you encrypt someone's email server, they lose productivity. When you encrypt their building management system, their facility becomes unusable and tenants cannot work. 

3: Regulatory and insurance requirements 

Compliance drivers: 

• NIS2 in Europe: Explicitly brings building operators into scope with substantial penalties for non-compliance 

• Cyber insurance: Questionnaires now ask specific questions about building system security 

• Insurance premiums: Insurers exclude coverage or charge higher rates without adequate building controls 

• Tenant due diligence: Commercial tenants ask about building security before signing leases 

• Liability exposure: Building operators face legal consequences when inadequate security leads to breaches 

The demand exists across multiple drivers. The question is who will serve it. 

The competitive landscape: Why your competitors cannot follow you 

Can endpoint-focused security vendors protect building systems? 

No. Your main competitors cannot follow you into OT security. The architectural assumptions that underpin their platforms fundamentally do not work in operational technology environments. 

Why can Huntress not protect building systems? 

Huntress limitations: 

• Built entirely around endpoint protection with agent-based architecture 

• Assumes they can install an agent on every device being monitored 

• Building management systems, HVAC controllers, and access control panels cannot run agents 

• BMS controllers lack the resources, OS capabilities, and architecture to support endpoint detection 

• Reengineering their platform would require rebuilding from the ground up 

Huntress cannot protect building systems, period.

What about Blackpoint Cyber, RocketCyber, and other MSP vendors? 

Similar limitations across MSP security vendors: 

• Blackpoint Cyber: Endpoint-centric architecture, cannot monitor agentless OT devices 

• RocketCyber: Designed for IT environments, lacks OT protocol support 

• Arctic Wolf: Some network visibility through NDR but no BACnet, Modbus, or OPC-UA protocol support 

• All lack SOC analysts trained in industrial cybersecurity for MSPs 

These vendors are excellent at what they do - IT security. But buildings are a blind spot they cannot easily fill. Their go-to-market strategies, pricing models, and product roadmaps all assume an endpoint-based world. 

What about enterprise OT security vendors like Claroty and Dragos? 

Enterprise OT vendor limitations for MSPs: 

• Claroty, Dragos, Nozomi, Darktrace Industrial: No MSP channels, sell direct to enterprise only 

• Pricing models: Assume organizations with dedicated internal security teams 

• Not designed for managed services: Platforms require customer operation, not MSP delivery 

• Enterprise focus: Do not serve mid-market building operators who need fully managed security 

The market gap: 

• Organizations with building systems need security 

• MSPs are the natural delivery channel for mid-market building operators 

• Most MSPs cannot deliver building security 

• Enterprise vendors do not serve this segment 

The verticals that open up with OT security 

What new markets does OT security capability unlock for MSPs? 

Adding OT capability opens entirely new conversations with verticals that were previously difficult to serve effectively. 

Commercial Real Estate 

Why commercial real estate needs smart building MSP services: 

• Property managers operate portfolios of office buildings, retail centers, and mixed-use developments 

• Need security across dozens or hundreds of properties delivered consistently 

• Must provide reporting to tenants and insurers 

• Tenants ask about building security during lease negotiations 

• Recurring revenue relationships with multi-facility clients 

Market size: Property managers with 10-100+ buildings represent substantial contract values when billed per facility.

Healthcare Facilities 

Why healthcare is a strong vertical for OT security: 

• Hospitals and clinics operate connected building systems and medical devices 

• Face strict compliance requirements under HIPAA and sector-specific regulations 

• Building security is part of broader security obligations, not separate 

• Understand risk and compliance, making them receptive to security conversations 

• Typically operate multiple facilities across regions (hospital systems, clinic networks) 

Opportunity: Portfolio-wide security programs for healthcare systems with campuses across multiple locations. 

Manufacturing 

Manufacturing OT security needs: 

• Industrial control systems managing production lines 

• SCADA networks monitoring and controlling processes 

• OT environments that traditional IT security cannot address 

• Operational continuity requirements that make security critical 

• Integration between IT business systems and OT production systems 

Logistics and Warehousing 

Distribution center security requirements: 

• Automated systems throughout facilities 

• Climate control for sensitive goods 

• Connected equipment and inventory management 

• Building automation for large warehouse spaces 

Hospitality 

Hotel and resort OT security: 

• Integrated building management across properties 

• Room control systems (HVAC, lighting, access) 

• Guest-facing systems requiring protection without disrupting experience 

• Multi-property chains needing standardized security 

Common thread: None of these verticals can be served effectively with endpoint-only security. All represent growth opportunities for MSPs who can offer comprehensive IT and OT coverage. 

The margin opportunity in OT security 

Why does OT security command premium pricing? 

OT security is not a commodity. It requires specialized knowledge, different tools, and expertise that most providers lack. 

Premium pricing drivers: 

• Scarcity of providers creates pricing power 

• Specialized expertise commands higher rates 

• Limited competition eliminates price pressure 

• Clients recognize value of solving previously unaddressed gaps 

How do clients view OT security pricing? 

When you are one of few providers who can serve a client's actual needs, price pressure disappears. 

The pricing conversation shifts: 

• Before: "Why does this cost more than the other MSP's proposal?" 

• After: "How quickly can we get this implemented?" 

Client perspective: 

• Understand they have gaps in security posture 

• Know current provider cannot address building automation, access control, HVAC security 

• Recognize you offer capabilities competitors do not have 

• Focus on value and implementation timeline, not price comparison 

What revenue increase can MSPs expect from adding OT security? 

Typical revenue impact: 

• 20-30% additional MRR per client on average 

• 50%+ increase for clients with multiple facilities or complex building automation 

• Per-building pricing for commercial real estate portfolios 

• Premium rates for specialized verticals like healthcare and manufacturing 

The stickiness factor: Why OT clients stay longer 

Why are OT security clients harder to lose than traditional IT clients? 

Clients who engage you for OT security are harder for competitors to displace than clients who only have basic managed services. 

Reason 1: Higher Switching Costs 

What creates switching costs in OT security: 

• Baseline development for normal operational behavior specific to each building 

• Protocol tuning for building-specific communication patterns 

• Integration with building systems that requires time and expertise 

• Setup investment creates substantial inertia 

A competitor attempting to win the account would need to replicate all setup work, and the client would experience a coverage gap during transition. 

Reason 2: Deeper Trust Relationships 

How OT security changes client relationships: 

• You protect systems that keep buildings functional 

• You become critical infrastructure to client operations 

• Building operators cannot afford gaps in monitoring 

• Relationship based on operational continuity, not just IT support 

This relationship is harder to disrupt than one based on email security or endpoint protection.

Reason 3: Limited Competitive Alternatives 

Market reality: 

• If clients shop endpoint protection, they find numerous competitive alternatives 

• If they shop OT security, they find the market is thin 

• Few MSPs can credibly claim OT capability 

• Your position becomes defensible in ways commodity IT services are not 

Result: OT security creates competitive moats through switching costs, deep trust, and limited alternatives. 

How to develop OT security capability 

What prevents MSPs from building OT security capability in-house? 

Building OT expertise from scratch is expensive and time-consuming. 

Barriers to internal development: 

• Talent: Need to hire specialists with industrial cybersecurity backgrounds (scarce and expensive) 

• Technology: Must invest in protocol-aware sensors, OT-specific detection platforms, vendor integrations 

• Processes: Must develop playbooks for OT security that differ from IT security response 

• Knowledge: Must learn domain with its own vocabulary, protocols, and operational constraints 

• Timeline: Internal capability development runs to years, not months 

• Capital: Substantial investment required with high risk of failure 

How does partnership enable faster OT capability development? 

Partnership provides an alternative to years of internal development. 

The enhanced.io partnership model: 

• Open XDR platform: Integrates sensors and collectors for building visibility 

• Protocol support: Understands BACnet, Modbus, OPC-UA, and other industrial protocols 

• SOC expertise: Analysts trained in OT security who know normal building system behavior 

• Fractional security directors: Lead client conversations about building risk in business language 

• 24/7 monitoring: Enterprise-grade OT security monitoring 

What MSPs provide: 

• Client relationships and trust 

• Local service delivery 

• Account management 

• Integration with broader managed services 

What clients receive:

• Enterprise-grade building security from provider they already trust 

• Comprehensive IT and OT coverage from single MSP 

• No need to manage technology themselves or hire internal expertise 

• Mid-market pricing instead of enterprise costs 

The timing: Why 2026 is the inflection point 

Why is now the right time to enter the OT security market? 

OT security is at an inflection point in 2026 that creates exceptional opportunities for MSPs who move decisively. 

Current market dynamics: 

• Demand: Growing rapidly (attackers, regulators, insurance requirements) 

• Supply: Limited (most MSPs cannot offer OT security) 

• Competition: Low (enterprise vendors do not serve mid-market) 

• Opportunity window: Open now but will not last forever 

What happens as the OT security market matures? 

Future market evolution: 

• More providers will develop capability as opportunity becomes obvious 

• Tools will become more accessible as vendors recognize MSP channel 

• Expertise will spread as more security professionals gain OT experience 

• Competitive advantages available today will diminish 

Timeline: This maturation will happen over 2-4 years. First movers in 2026 capture the advantage. 

What advantage do first movers gain in OT security? 

First-mover advantages: 

• Client relationships: Build relationships in commercial real estate, healthcare before market is crowded 

• Reputation: Become known as the provider who understands building systems 

• Referrals: Create referral networks and word-of-mouth that compounds over time 

• Market share: Capture clients while competitors are still figuring out how to respond 

• Defensibility: Establish positions that are hard to displace due to switching costs 

The window for first-mover advantage is open now. It will not remain open indefinitely. 

Key takeaways 

The market opportunity: 

• Smart buildings are ubiquitous, creating massive attack surface traditional IT security does not cover 

• Attackers target building systems (third most common ransomware target) 

• Regulators (NIS2) and insurers require building system security 

• Demand exists but supply limited - most providers cannot serve this market 

The competitive advantage: 

• Endpoint-focused MSP vendors (Huntress, Blackpoint, RocketCyber) cannot protect building systems 

• Enterprise OT vendors (Claroty, Dragos) do not have MSP channels or mid-market pricing 

• Few MSPs can offer building security, creating differentiation 

• OT security creates stickier relationships with higher switching costs 

The business case: 

• Opens new verticals: commercial real estate, healthcare, manufacturing, hospitality 

• Commands premium pricing (20-30% additional MRR per client) 

• Creates defensible competitive moats through deep integration 

• Partnership models enable capability in months, not years 

The timing: 

• 2026 is the inflection point before market becomes crowded 

• First movers establish defensible positions 

• Window for competitive advantage is open now 

What should MSPs do next? 

If you are looking for differentiation that matters and growth opportunities beyond commoditized IT security, OT security is the opportunity in 2026 (see how Onsite Technologies have already started this journey). 

Take action now: 

1. Evaluate your client base for building system security opportunities (commercial real estate, healthcare, manufacturing) 

2. Understand the competitive landscape and recognize that endpoint-focused competitors cannot follow you into OT 

3. Assess partnership options that enable OT capability without years of internal development 

4. Position yourself as a first mover while the market opportunity is still open 

Ready to explore the MSP OT opportunity? 

Contact us to discuss how the partnership model works and how enhanced.io can enable you to deliver industrial cybersecurity MSP services and smart building MSP services without building internal OT expertise. 

Or read our complete guide to OT security for MSPs to understand the technical requirements, go-to-market approach, and client conversation frameworks for building security services.