Average Cost of Managed IT Services: $150-$300 in 2023

As a savvy business owner, you're well aware that in today's dynamic business landscape, having a robust IT infrastructure is an absolute must! It's a key to unlock peak productivity and efficiency, enabling you to outshine the competition and stay ahead of the game.

But let's be real, maintaining an in-house IT team is no easy feat. Sure, having them on-site has its perks, but it comes with its fair share of limitations in terms of resource constraints and constant distraction from your core executive duties. And let's not forget the challenge of keeping up with all those specialized skills and knowledge under one roof.

But what if you could outsource all this stress of managing the entire IT environment of your business to a team of technology experts, leaving you with the freedom to focus on what truly matters?

Well, it's not too good to be true – it's called managed IT services.

According to Gartner’s latest forecast, in 2023, the worldwide spending for IT services is projected to $4.6 trillion in total, which has increased by 5.5% from 2022.

In 2025, more than sixty percent of businesses are expected to depend on managed services providers (MSPs), which will completely alter the current economic landscape. The USA's managed services Industry is projected to reach an amount at USD 72.88 billion in 2026, thanks to this increase in demand.

1 What are managed IT services?

To put it simply, managed IT services imply that a third-party organisation, commonly referred to as a managed services provider (MSP), handles all of your IT-related tasks, no matter how complex they may be. It's similar to having a trustworthy IT ally who, for a price, would provide you with specialised assistance. To avoid the high costs associated with keeping an in-house IT department, small and medium-sized enterprises can benefit greatly from this method.

Though, the services offered by MSPs vary in accordance with the unique requirements of their client companies. However, to generally put, they handle everything, from fixing printer problems to fixing internet connection issues to finding those illusive missing files.

The following are examples of their most popular services:

• Network management and security
• Data backup and recovery
• Cybersecurity
• Helpdesk support
• Software updates and patch-management
• Hardware maintenance
• Cloud services
• End-user assistance

2 How much do managed IT services cost on average?

If you’re looking for a straightforward answer to the question, "there is no fixed cost," is the reply.

It’s because, with the vast variability in deliverables and responsibilities among managed IT services, pricing can significantly vary too. Also, the true cost hinges on variables like the number of users, employees, locations, and the length of the Service Level Agreement (SLA). Additionally, individual service providers may have their own pricing models, such as flat-fee, per-hour, or per-month, which can influence the overall expenses.

A) Per-device pricing model

This is one of the most widely used models among Managed Service Providers (MSPs). The model is pretty straightforward – it focuses on managing individual user devices like desktops, laptops, mobile devices, network printers, and servers. Under this model, clients are charged a fixed monthly fee by MSPs for providing comprehensive support and management to each device.

Under this model, a bundle of services is offered for each device, which includes stuff like update and patch management, antivirus protection, DNS filtering, and regular performance optimization etc.

This model is popular because it's easy for both the MSPs and us, their clients, to understand. It gives us the flexibility to scale our managed IT services based on how many devices we have and need support for.

However, Implementing Bring Your Own Device (BYOD) policies and supporting remote work scenarios can add complexity to the pricing model due to managing devices outside the traditional office environment. Moreover, because it’s a price-oriented model, focus on price may overshadow the actual benefits of the services provided.

B) Per-user pricing model

Unlike the traditional Per-Device model, the Per-User model simplifies your IT expenses by charging a fixed fee per employee, regardless of the number of devices they use. So, let's say you have 20 employees in your company. Instead of worrying about how many computers, laptops, smartphones, or tablets each person uses, you just pay a fixed amount for each employee. This makes budgeting and planning your IT expenses much more straightforward because you know exactly what you'll be paying for each user.

The best part about the Per-User model is that it covers all the IT needs of each employee. So, whether they use a work computer, a personal laptop, or a smartphone, all these devices are included under their per-user fee.

This model is also great for businesses where employees use multiple devices or work remotely. It's especially useful if you expect your company to grow because adding new users to the plan is simple and predictable, without getting bogged down from complex IT pricing.

C) All-inclusive pricing model

Just like at a buffet, where you can enjoy as much food as you want for a fixed price, the all-inclusive model works on a similar concept. So, if your business signs up for a monthly IT support contract or an annual flat fee, and voila! You get access to a whole range of services offered by the managed service provider (MSP). It's like having a buffet of IT solutions at your disposal!

The best part? You know exactly what you're paying for each month, no surprises lurking around the corner. The main aim of the all-inclusive model is to give you peace of mind. You can rest easy knowing that your managed services agreement will cover any issues that may pop up, whether they're predictable or unexpected. So, no need to fret about cybersecurity incidents or other unexpected expenses – you've got it all under control!

This pricing model is super flexible too. It's designed to cater to your organization's specific needs, providing remote support, on-site help, and lab time – all bundled together. Some plans even include 24/7 year-round support, while others may offer services during specific hours or days, with additional charges for anything outside those times.

D) Custom pricing model

The custom pricing model in managed IT services is all about tailoring the perfect plan for your specific needs. Instead of paying for a one-size-fits-all package, you get to choose the exact services you require, no more and no less. This means you won't waste money on things you don't need, and you'll have the flexibility to add on extra services as your business grows.

1 Quick View: Price list of 27 Popular Managed IT Services Providers

4 Discussion: Are managed IT services worth the cost?

Managed IT services are a game-changer for businesses. They prevent costly IT issues and boost your cybersecurity defenses. When you partner with the right provider, you get to focus on what you do best while tapping into cutting-edge technology. Plus, you get scalability, flexibility, and predictable budgeting, keeping you ahead of the competition. And guess what? Compliance and regulatory boxes are ticked effortlessly, saving you from potential penalties and legal tangles.

Don't hesitate to embrace managed IT services as your strategic partner, freeing you up to focus on your core business without worrying about IT glitches. It's an investment, not an expense, that empowers your business to thrive, stay secure, and embrace the digital future with confidence. It’s worth it.

FAQs

What factors influence the cost of managed IT services?

Maverick

The cost of managed IT services can significantly be influenced by factors like number of devices and users, the required services level and scope, MSP’s pricing model, business size, complexity of the IT infrastructure, and any additional specialized services or security requirements.

Are managed IT services more cost-effective than an in-house IT team?

Maverick

Yes, Managed IT services are typically more cost-effective than maintaining an in-house IT team. You get access to expert support without the overhead expenses of managing a full department. Plus, you save on expenses like training, benefits, and hardware upgrades.

How is the cost of managed IT services calculated?

Maverick

The cost of managed IT services is typically calculated based on the pricing model chosen, such as per-device, per-user, or all-inclusive, and the specific services and level of support required by the business.

Are there any hidden costs associated with managed IT services?

Maverick

No, there is always a transparency about the ‘pricing’ of a reputable managed IT services. They ensure that there are no hidden charges. Everything is clearly laid out in their service agreement.