News
What Is Model Context Protocol (MCP) and Why Should You Care?
- By Pure AI Editors
- 01/07/2026
What is Model Context Protocol?
Model Context Protocol (MCP) is an open-source standard that defines a set of rules for how AI assistants and agents can connect to data sources and tools. The idea is illustrated in Figure 1.
[Click on image for larger view.] Figure 1: Model Context Protocol (source: Pure AI).
In the diagram, AI Application 1 could be something like a ChatGPT (from Open AI) system. The application needs data from a SQL database, a document store, and some sort of custom processing tool. AI application 2 could be something like a Llama agent (from Meta) that needs to access some documents and a database of images.
The two applications could use custom code to access the needed resources. Instead, the applications access their resources through a set of standardized rules defined by the Model Context Protocol.
MCP defines how AI applications can access resources, but MCP is not a protocol for how different AI applications can communicate with each other (indicated by the dashed red arrow in the diagram). Designing an application-to-application protocol is a seperate ongoing effort in AI research.
Why Use MCP?
By standardizing how AI connects to business tools and data, MCP reduces IT development overhead, and improves security through carefully designed controlled access. These factors potentially unlock significant productivity gains across organizations of any size.
What Are the Downsides of MCP?
Implementing MCP properly requires careful configuration of permissions and access controls. Businesses need to ensure they're not inadvertently exposing sensitive data or giving AI assistants excessive privileges.
Organizations need non-trivial technical resources to build and maintain MCP servers. Depending on a company's existing infrastructure, the initial setup and ongoing maintenance of MCP can represent a significant investment.
What Are Business Opportunities Associated with MCP?
The Pure AI editors asked Dr. James McCaffrey to speculate about possible business opportunities. McCaffrey worked in Microsoft Research for over 20 years before retiring recently. McCaffrey observed, "One business possibility is a company that creates a platform that offers a curated library of pre-built, enterprise-grade MCP servers for popular business tools (Salesforce, SAP, Smartsheet, etc.) This could appeal to companies that can't afford deep in-house AI technical expertise."
He added, "Another possibility is a specialized consulting service that helps enterprises safely implement MCP by conducting security audits, designing permission frameworks, and ensuring regulatory compliance (GDPR, HIPAA, etc.) As companies rush to connect AI to sensitive internal systems, it seems likely that there will be a significant demand for experts to help organizations navigate the risks of AI-powered data access."
How Might MCP Evolve?
McCaffrey speculated, "It's possible that MCP will evolve into a marketplace ecosystem where pre-built, certified MCP servers for popular enterprise tools become commoditized plug-and-play solutions."
However he cautioned, "Open-source standards have a history of incredible success, such as HTTP for the internet, but also many significant failures, such as ONNX for machine learning models. Designing and maintaining open-source standards is difficult. And open-source standards can have negative consequences for business models that undermine their adoption."