Business of Tech: Daily 10-Minute IT Services Insights

AI-Driven Cyber Threats Surge: SMBs Embrace MDR, Shadow AI, and Evolving Malware Tactics

Nov 18, 2025

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The rise of artificial intelligence (AI) in cyber attacks is prompting small and medium-sized businesses (SMBs) to adopt managed detection and response (MDR) services and explore autonomous security operations centers (SOCs). Research from TechAisle indicates that awareness of MDR among SMBs increased from 39% in 2023 to 61% in 2025, with 89% of mid-market firms prioritizing cyber resilience. This shift is driven by the need for effective security operations that do not rely on in-house expertise, as AI-driven threats evolve faster than traditional defenses can respond.

A report from UpGuard highlights the prevalence of shadow AI, revealing that 68% of security leaders use unauthorized AI tools, with 90% of them bypassing corporate governance. This disconnect between security protocols and employee behavior underscores the need for organizations to adapt their governance strategies. Additionally, a significant cyber attack attributed to a Chinese state-sponsored group demonstrated AI's capability to autonomously conduct reconnaissance and data exfiltration, marking a shift in threat actor tactics.

Retail executives are increasingly concerned about their employees' ability to identify genuine cyber threats, with 44% reporting a rise in cyber attacks. Despite this awareness, only 25% feel prepared for AI-driven incidents. The report emphasizes the necessity for retailers to adopt a resilience-focused approach, including improved application security and identity controls, to mitigate risks associated with sophisticated cyber threats. This highlights a broader trend across industries where reliance on employee training alone is insufficient to combat evolving threats.

For Managed Service Providers (MSPs), these developments present both challenges and opportunities. The increasing complexity of cyber threats necessitates a shift towards operational models that prioritize continuous verification and behavioral analysis over traditional detection methods. MSPs can leverage this moment to guide organizations in developing effective cybersecurity strategies that address the preparedness gap, ensuring that clients are equipped to handle the evolving landscape of AI-driven attacks.

Four things to know today

00:00 AI-Powered Attacks Accelerate as SMB Security Transitions Toward Autonomous SOC Models, Exposing a Governance Gap Around Shadow AI

06:43 Retail Executives Report Rising AI-Driven Threats and Low Preparedness, Underscoring the Shift from User Training to Resilience

08:50 Stealthier North Korean Campaigns and a Fragmented Ransomware Ecosystem Signal Rising Detection Challenges for MSPs

11:49 Cork’s New Vantage Platform Targets Unified MSP Risk Validation — But Its Visibility Metrics Demand Scrutiny

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