Managed IT Service Pricing Guide

IT Services
Managed IT Service Pricing Guide
Article by Sumana Ganguly
Last Updated: April 26, 2023

In the past years, there has been a shift towards more affordable and reliable IT solutions for businesses of all sizes through managed services.

As technology continues to advance, so does managed IT service pricing. And in 2023, the managed IT service pricing landscape is sure to be in a state of flux.

Businesses that want to save money and get the best service for their money need to stay ahead of the curve.

When finding and maintaining the best-managed IT services for your business, pricing is a significant factor.

Thankfully, there are ways to get the best bang for your buck and the best service to protect your business from potential IT security risks.

This guide explores how managed IT service prices will look in 2023 and how managed service providers (MSPs) can help your business save more in the long run.

Factors That Affect Managed IT Service Pricing

Several factors come into play when it comes to managed IT services prices:

  • Service Time: The amount of time a managed IT service provider will take to deliver the service affects the price. If a service takes more time, the provider may charge more. Some providers may charge a fixed rate or offer discounts based on the length of the contract.
  • The Number of Users: The more people using your system at any given time, the more likely it will be affected by downtime and other problems caused by poor maintenance. If you have several hundred users on one server, then scheduling regular backups will keep things running smoothly while keeping down costs at the same time.
  • Data Used on Servers: The amount of data stored on servers increases over time, and providers may charge more for more extensive data sizes. Additionally, different types of data require different levels of security so that providers may offer higher prices for sensitive data storage.
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How Much Does Managed IT Cost?

Generally speaking, companies with fewer than twenty users can expect to pay anywhere from $2,000 to $3,000 per month or about $24,000 to $3,000 per year.

Managed IT can also be priced per user. Most businesses will pay between $50 and $400 per user each month, depending on their required services.

If you have one server, expect to pay from $5,000 to $20,000+. The price may vary depending on the type of equipment you need.

Many managed service providers usually provide a lower upfront price for servers. For instance, some MSPs may charge $285 monthly for cloud servers, while backup and data recovery services start at $200 monthly.

The average managed IT service cost for data storage is between $5 and $500 per month. The latter includes maintenance and backups.

For services and upgrades, you can prepare anywhere between $50 and $1,000 per month, depending on the size of your business and the types of managed IT services you require.

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What’s Included in Managed IT Services Cost?

In 2023, managed IT service providers will continue to offer comprehensive packages that include a wide range of services to ensure businesses get the best value for their money.

Here are some of the services that may be included in a managed IT service package:

  • Cloud Services: The cloud is revolutionizing how companies do business, especially for managed IT service providers. Cloud-based solutions allow businesses to access data and applications anytime and anywhere. This is especially beneficial for remote teams who need to stay connected while on the go. Most managed IT service companies offer cloud-based services such as file sharing, email hosting, data backup and storage, web hosting, and more.
  • Monitoring Services: A big part of any managed IT service package includes monitoring services. This includes 24/7 monitoring of servers, networks, and applications. With this service, you can see to it that your systems are running efficiently and securely. It also helps reduce downtime, as any problems can be quickly identified and addressed.
  • Security and Compliance: Cybersecurity threats are a major concern for businesses today. Managed IT service providers offer a range of security and compliance services to help protect your data. These services include firewall protection, virus and malware protection, data encryption, and more.
  • Remote Support: Having a team of experienced IT professionals at your disposal is invaluable when resolving technical issues quickly and efficiently. Most managed IT service providers offer remote support services so you can get quick assistance with any technical problems you may encounter.
  • Disaster Recovery: Disaster recovery is essential to any business's IT strategy. Managed IT service providers typically provide disaster recovery solutions so you can ensure your data and systems are secure in the event of an unexpected outage or disaster.
  • System Reporting: System reporting is crucial to any managed IT service package. It allows you to keep track of system performance and security and troubleshoot any issues that may arise.
  • Asset Management: Managing physical assets such as laptops, tablets, and mobile devices can be challenging for businesses. Many managed IT service providers offer asset management solutions to help you keep track of your hardware assets, ensuring they are secure and up-to-date.

Most Common Managed IT Service Pricing Models

  • Per Device: This model charges a set fee for each device that requires IT service. This is often the most cost-effective approach for businesses with multiple devices, as the overall cost remains relatively low regardless of how much assistance is needed.
  • Per User: This model charges a fee for each user who needs IT support. This approach works best for organizations with many users but doesn't require extensive IT services.
  • Unlimited: This approach offers an unlimited range of IT services for a fixed price. The fee includes round-the-clock support, ongoing maintenance, and regular updates and backups.
  • A La Carte: This pricing model allows customers to select from a list of required services and pay only for those services. Additionally, this approach enables businesses to tailor their IT service package to their specific needs and budget.
  • Tiered Pricing: Tiered pricing allows customers to purchase IT service packages at different price points, depending on the level of service required. This model works well for businesses that need more comprehensive IT services but don't need all the bells and whistles associated with unlimited plans.

7 Ways Managed IT Services Can Help You Save More

  1. MSP Reduces IT Costs
  2. It Prevents You from Hiring too Many IT Staff
  3. It Allows You to Use Technology More Efficiently
  4. MSP Saves You from Hidden Costs
  5. MSP Allows for Technology Maintenance
  6. Managed IT Handles Automation
  7. Managed IT Services Provide Experienced Support

1. MSP Reduces IT Costs

The most apparent way managed service providers help you save money is by reducing your IT costs.

Managed services typically include hardware and software and might even include your network. You don't have to purchase, maintain, and update these things in-house.

Because managed services are typically more expensive upfront, managed service providers may be willing to negotiate a contract that includes a lower up-front cost.

If you're paying as you go, you only want to end up paying what you would have if you bought the services yourself.

2. It Prevents You from Hiring too Many IT Staff

Research shows that 62% of small businesses lack the in-house skills to manage cybersecurity. With that, you might think it may be necessary to hire more IT staff.

However, hiring more staff is costly, and it often means you have to train new employees, which takes time away from your core business functions.

Managed services help you avoid hiring too many staff members by allowing you to outsource certain IT functions to one or more managed service providers.

This way, you only incur the costs of hiring extra staff members when needed.

3. It Allows You to Use Technology More Efficiently

For example, managed services can allow you to use cloud-based computing, which is more cost-effective than traditional computing. This can reduce your overall costs and make your business more efficient.

4. MSP Saves You from Hidden Costs

Apart from the cost of hiring managed service providers, you are also responsible for paying for the equipment managed service providers use, such as servers. This may come with a fee above and beyond your monthly bill.

If you hire managed service providers and pay for the equipment yourself, you might pay more in the long run if your equipment needs upgrades.

5. MSP Allows for Technology Maintenance

Some managed service providers offer additional services, such as ongoing maintenance or repair services. If your managed service provider is responsible for ongoing maintenance, you don't have to train your staff to perform these tasks, which saves time and money. For instance, you can hire an enterprise software development company to create a custom solution for you and have a managed IT service provider set it up and maintain it. 

6. Managed IT Handles Automation

Automation helps streamline processes and provides IT services with fewer resources, leading to lower overhead costs.

Automating tasks such as patching, software updates, and network security can reduce the time and money spent managing your IT infrastructure.

7. Managed IT Services Provide Experienced Support

Using managed IT services gives you access to experienced technical support staff who understand your business needs and can provide tailored solutions.

Investing in expert advice can save you both time and money when resolving technical issues quickly and efficiently.

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Other Things To Consider When Choosing an MSP

  • Service Reputation: Before signing a contract with any managed service provider, do some research on the company. Read reviews from other businesses, and ask for references from businesses in your industry, as the managed service providers may differ.
  • Customer Service: You want a managed service provider with excellent customer service. If you ever have a problem, you want to feel comfortable talking to someone about it. A managed service provider that provides good customer service can help you fix your problems.
  • Service Level Agreement: Have a service level agreement (SLA) in place before signing a contract with a managed service provider. An SLA is a contract that outlines the service level expectations and what happens if the managed service provider doesn't meet those expectations.
  • Service Location: It's beneficial for your managed service provider to be located in a place with minimal risk of natural disasters, like earthquakes, floods, and hurricanes. Service location also affects how quickly your managed service providers can respond to a problem.

Top IT Services Agencies To Hire

1. Xtreme Pathfinders Pvt Ltd

  • Location: 52 A Block A Military Accounts Society College Road, Lahore, 54000, Pakistan
  • Average Hourly Rate: $7
  • Expertise: IT Services

Xtreme Pathfinders (Pvt.) Limited is a leading company offering a complete platform for their clients' business solutions. Their extensive variety of administrations in business and data innovation take a stab at excellence in every perspective.

Their effective operation is obtained from their broad ability in view of two noteworthy qualities: an all-around qualified group of staff and a differing scope of customers. They see the demonstrable skill as their continuance considers this dynamic business world. 

2. Startbit IT Solutions Pvt. Ltd.

  • Location: C-6/82, Sector 6, Chitrakoot, Vaishali Nagar, Jaipur, 302021, India
  • Average Hourly Rate: $25
  • Expertise: Node.js Development, Software Development, Mobile App Development, eCommerce Development...

Startbit IT Solutions is a Global IT Services provider company with expertise in outsourced product development and custom software development focusing on web app development, mobile app development, and tailor-made solutions. They consistently deliver offshore outsourcing solutions, quality software products, and solutions to start-ups, mid-size businesses, and large enterprises worldwide.

They have 1400+ satisfied clients worldwide and develop web, windows, and mobile applications using all the latest technologies i.e. Microsoft Technologies (ASP.Net, C#, VB.Net, Azure, Entity/MVC framework, SSRS, Crystal Reports, etc.), MEAN Stack, Front-end, PHP, Laravel, React, MERN, WordPress, CodeIgniter, Shopify, Ruby on Rails, Android Development, iPhone development, Hybrid mobile app, etc.

3. Webllisto

  • Location: 801, Airen Heights, Behind Pakiza Mall, Vijay Nagar, Indore, 452001, India
  • Average Hourly Rate: $50
  • Expertise: Enterprise Software Development, PHP Development, VR/AR, Internet of Things...

Webllisto is a pioneer software development company specializing in the blockchain arena. We discover talents and render blockchain development services that outshine your business from an ocean of competitors.

Webllisto's expert blockchain developers are trained and certified, rendering several software development services ranging from blockchain software development to Metaverse development. They are the best-in-class custom Blockchain Development solution provider company encompassing a raft of decentralized applications in the blockchain space.

Webllisto is headquartered in California, with additive offices in Indore and Lucknow, India. They select some of the finest technical talents to structure your project, serving funded startups and multimillion-dollar companies across the globe.

Managed IT Service Pricing: Final Words

Studies show that 45% of businesses plan to partner with an MSP, while 42% allocate additional security to protect their data.

Additionally, 59% of IT services have moved from the traditional break-fix model to managed services.

This shows that managed IT services are here to stay. Businesses should be prepared to evaluate the various options available to get the best service at the most reasonable price.

As the cost of traditional IT support increases, managed IT services can offer an attractive alternative that can help businesses save money while ensuring they get the best possible service.

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