How Much Does Managed IT Services Cost?

Managed IT services are a widely chosen solution for companies seeking to delegate their IT responsibilities to an external service provider. But how much do managed IT services cost? And what factors affect the pricing of these services? In this article, we will explore the answers to these questions and help you decide if managed IT services are right for your business. Managed IT services refer to the practice of outsourcing the migration, implementation, maintenance, and upgrades of various components of an organization’s IT infrastructure, such as backup and security, to a third-party vendor. This vendor is typically remote or located offshore and is known as a managed service provider (MSP). There are several types of managed IT services, such as:

• Cloud computing
• Data backup and recovery
• Network monitoring and management
• Security and compliance
• Help desk and support
• Software as a service (SaaS)
• Infrastructure as a service (IaaS)
• Platform as a service (PaaS)
• Desktop as a service (DaaS)
• Disaster recovery as a service (DRaaS)

Each type of managed IT service has its own benefits and challenges, and the cost of each service may vary depending on the scope, complexity, and level of customization required by the client. Let’s delve further into how much managed IT Services Cost.

Factors Affecting the Pricing of Managed IT Services

The cost of managed IT services depends on various factors, such as:

• The size and type of the client’s business: Bigger and more regulated businesses have higher IT needs and costs.
• The number and location of the client’s devices and users: More devices and users in different locations require more IT resources and support.
• The current state and performance of the client’s IT infrastructure: Outdated, inefficient, or insecure IT infrastructure needs more upgrade, optimization, or protection.
• The specific services and features requested by the client: More comprehensive and customized managed IT services have higher prices and value.
• The service level agreement (SLA) and contract terms between the client and the MSP: Higher SLA and longer contract terms guarantee higher quality and stability of managed IT services, but also higher costs.
• The quality and reputation of the MSP: Well-known, reputable, and certified MSPs charge more for their managed IT services, but also deliver better results and satisfaction.

These are some of the main factors that affect the pricing of managed IT services. However, each client and MSP may have their own specific factors that influence the cost of managed IT services. Therefore, it is important to communicate and negotiate clearly and fairly to find the best price and value for the managed IT services that suit the needs and expectations of both parties.

Pricing Models of Managed IT Services

There are three main pricing models for managed IT services:

• Per-device pricing: The client pays a fixed monthly fee for each device (such as a computer, server, printer, etc.) that is covered by the MSP. This model is simple and transparent, but it may not account for the complexity and variability of the client’s IT needs.
• Per-user pricing: The client pays a fixed monthly fee for each user (such as an employee, customer, partner, etc.) that is supported by the MSP. This model is flexible and scalable, but it may not reflect the actual usage and demand of the client’s IT resources.
• Value-based pricing: The client pays a fixed monthly fee that is based on the value and outcomes delivered by the MSP. This model is aligned with the client’s business goals and objectives, but it may be difficult to measure and quantify the value and outcomes of the MSP. Each pricing model has its own advantages and disadvantages, and the client and the MSP need to choose the best one that suits their needs and expectations. Some of the factors that may affect the choice of the pricing model are:

• The budget and cash flow of the client: The client may prefer a pricing model that fits their budget and cash flow. For example, a client that has a tight budget and a variable cash flow may prefer a per-user pricing model that allows them to pay only for the users they need and adjust the fee according to their cash flow. On the other hand, a client that has a large budget and a stable cash flow may prefer a value-based pricing model that guarantees a fixed fee and a high value for their IT investment.

• The predictability and transparency of the IT costs: The client may prefer a pricing model that provides predictability and transparency of the IT costs. For example, a client who wants to know exactly how much they will pay for the managed IT services each month may prefer a per-device pricing model that charges a fixed fee for each device. On the other hand, a client that does not mind some fluctuations in the IT costs as long as they get the best service and value may prefer a value-based pricing model that charges a fee based on the results and outcomes of the managed IT services.

• The complexity and variability of the IT needs: The client may prefer a pricing model that matches the complexity and variability of their IT needs. For example, a client that has a simple and stable IT infrastructure and a low IT demand may prefer a per-device pricing model that covers the basic IT services and features they need. On the other hand, a client that has a complex and dynamic IT infrastructure and a high IT demand may prefer a value-based pricing model that offers a comprehensive and customized package of IT services and features they need.

• The quality and satisfaction of the IT services: The client may prefer a pricing model that ensures the quality and satisfaction of the IT services. For example, a client who wants to get the best IT service and support possible may prefer a value-based pricing model that incentivizes the MSP to deliver high-quality, reliable, and secure IT services.

On the other hand, a client who is satisfied with the standard IT service and support may prefer a per-user pricing model that provides a reasonable level of IT service and support. Several factors can impact the selection of a pricing model for managed IT services. However, there may be other factors that are specific to each client and MSP that may also influence the decision. Therefore, it is important for the client and the MSP to communicate and negotiate clearly and fairly to find the best pricing model for the managed IT services that suit their needs and expectations.

Bottom Line

Managed IT services are a great option for businesses that want to outsource some or all of their IT tasks to a third-party provider. However, the cost of managed IT services may vary depending on various factors, such as the business size and type, the device and user number and location, the IT infrastructure state and performance, the service and feature request, the service level agreement and contract term, and the MSP quality and reputation. Therefore, it is important for businesses to do some research and compare different MSPs and their offerings, and to communicate and negotiate clearly and fairly to find the best price and value for the managed IT services that suit their needs and expectations.