How Much Does Managed IT Services Cost?

IT Solutions

Managed IT services offer a great solution to companies who want to reduce the costs of their IT systems whilst ensuring they still receive all the support they need. One of the main draws of this support model is that it can be a lot cheaper and more easily budgeted than the in-house IT department or the break-fix model.

But how much can you expect to pay if you choose to take the managed IT services route?

This is a tricky question to answer since there are a lot of variables at play. The best place to start is what managed IT services offer and how they differ from other IT models.

What Are Managed IT Services?

Managed IT services essentially allow you to outsource part or all of your IT support to an external Managed Services Provider (MSP).

MSPs generally charge a monthly subscription for their services. They can monitor your network for issues, preemptively address or fix these issues remotely, offer round-the-clock IT support and advice to your users, even provide recommendations and take on the upgrading of your entire ITC systems.

How Do MSPs Differ From Other Models Of IT Support?

Besides managed IT services, there are two other main types of IT support:

in-house IT departments; and
break-fix outsourcing.

In-house IT departments guarantee that you always have a dedicated IT team working solely for your business. While this ensures you always have a support team on hand who are familiar with your IT infrastructure, it does have a few drawbacks.

For a start, hiring and training specialist IT staff can be very expensive. It also leaves you open to both under and over-preparation – sometimes a lack of issues leaves your IT team with nothing to do, but during busy periods they may end up overstretched and unable to respond to every support request quickly.

The break-fix model involves outsourcing your IT needs on an ad-hoc basis to an external service provider to supplement or replace an in-house team.

This strategy ensures you always have support on hand no matter how severe or extensive the issue. However, break-fix providers charge per issue, which can quickly get expensive and hard to budget for.

A break-fix model can be ideal for smaller businesses with a simple IT infrastructure or those who operate with 100% cloud-based subscriptions. But, as a company scales, the IT requirements and the risk of something breaking or being compromised increase in both severity and frequency. Continuing with a break-fix model, in this case, can lead to the draining of productivity as users may feel obligated to waste time trying to fix an issue themselves rather than having to call the provider and incur charges.

Compared to the above models, managed IT services offer several advantages:

You’re guaranteed to have the support you need;
The subscription model is easily budgeted as a monthly operating cost and can often work out cheaper; and
Active monitoring with proactive fixes means that users can get back to work ASAP, ensuring consistent productivity.

Pricing Models for Managed IT Services

Not all MSPs charge for their services in the same way – while most will charge a fixed price monthly subscription, the way this charge is calculated can differ.

As well as the fluctuation based on the size of your organisation and the exact services you require, the price of an MSP’s service will vary depending on whether the solution offers a per-device, per-user, tiered pricing packages or possibly a combination of these.

Per-Device Pricing

This model charges for each individual device to be covered by the MSP. This could include servers, workstations, PCs, laptops, tablets, phones, faxes, printers and any other tech that needs support.

The advantage of this model is that it allows for easy quotes and can be very flexible since you can add or remove devices from your plan at any time.

Per-User Pricing

The per-user plan is an even simpler model than per-device, as your MSP will charge a fixed price for individual users covered by the services required rather than devices they use.

This means all the devices your staff make use of are covered – for example, if one person uses a PC, laptop, tablet and desk phone as part of their job, they have access to technical support for all of these devices. This solution can make per-user models cheaper than per-device since nowadays several users rely on various devices for their daily work.

Another significant benefit of the fixed price IT per-user model is the ability to easily scale up and down as the staff in the business changes.

Tiered Pricing

MSPs with a tiered pricing model offer different bundles of services charged at different rates. From cheap tiers offering basic network monitoring to more expensive bundles including comprehensive support and full IT provision.

Tiered models may have user or device limits within each tier, requiring you to move up to a higher package to support more users or devices, or may instead charge a different fixed price per-user or per-device rate for each tier.

While the transparency and simplicity of this model can be attractive, the obvious downside is you may find yourself paying for more than you need. If your business operates at the lower end of a tiered package, you will pay for unnecessary support, or you may have to choose a lower-tiered plan that doesn’t quite provide you with all the coverage you need for your business.

So How Much Do Managed IT Services Cost?

Unfortunately, there’s no simple answer to this, as the cost will depend on several factors: For example, the types of service you need, the complexity of your tech infrastructure (how many users and devices you have, the types of devices you use, and any specialist software you rely on), and the pricing model the MSP uses.

However, as a general estimate, you can expect to pay the following for the below levels of service.

Basic Plans

Simple monitoring of your infrastructure with alerts to your in-house IT team, plus additional support only for essential items, can cost as little as $70-150 per month.

However, additional support will likely be charged in a break-fix model, which can quickly add to higher costs with hourly rates ranging from $100-$250+.

Mid-Level Plans

Hiring an MSP to provide most or all of your IT support – including proactive monitoring and fixes, round-the-clock support, and advice, support and implementation for upgrades and updates – will cost you a bit more.

Per-user costs may range from $50-200; per-device prices could be as low as $10 for simple devices or as much as several hundred for a more sophisticated system.

Comprehensive, High-End Plans

Some MSPs may offer even more than IT support, providing your entire IT infrastructure through server hosting, cloud systems, and Desktop as a Service (DaaS) provision.

This comprehensive support naturally comes at a higher price – you can expect to pay anywhere up to $300 per user depending on how complex the infrastructure you require to operate your business.

How Much Could Managed IT Services Save Your Business?

One of the foremost advantages of managed IT services is that they’re often more cost-effective than other models of IT support. While this can be hard to quantify due to the number of intangibles at play, general comparisons are very favourable to managed IT services.

For example, if you compare the costs of a traditional IT infrastructure, assuming a company with 60 staff operating with an on-site legacy server versus a fully managed fixed price cloud solution for 60 users from FocusNet, FocusNet’s managed IT solution offers an estimated saving of $66,000 over four years.

This comparison clearly shows the significant cost savings that managed IT services could offer your business. In some cases a new cloud-based system may cost you more, however, often this is the case because of the many intangible benefits that come with a modern solution and expert support that you are currently not paying for. While individual factors may complicate this, it’s worth your time to contact a managed services provider for a consultation to see what they can offer your business.