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How Much Do Managed IT Services Cost?

How Much Do Managed IT Services Cost

Today’s corporate world is dominated by businesses that rely on the power of the internet to drive their operations. As such, practically every business needs a robust IT infrastructure to remain competitive in this landscape.

And since most business functions rely on these web-based applications and services, failure to keep their networks running smoothly can mean serious downtime, which might result in significant losses. Or in some cases, IT problems can be as simple as being unable to access a printer or a file on your organization’s cloud server.

However simple or complex they may be, these problems can be managed with the help of IT experts who can get things back into working order. Through managed IT services, you can prevent IT issues that cause significant downtimes.

The Severe Cost of Downtime to Modern Businesses

If you ever think that paying for managed IT services is unimportant when your company needs more knowledgeable and experienced IT specialists, consider this:

According to a cross-industry survey conducted by Gartner, network downtime could result in losses averaging $5,600 per minute or $336,000 per hour. Another study by Avaya reported that losses could range between $140,000 to $540,00 per hour, depending on the nature of the business, its degree of dependence on online networks, risk tolerance and other factors.

The cost of downtime is often directly proportional to the size of the enterprise. In October 2021, Facebook experienced a massive global outage that affected its subsidiaries. These include Messenger, Instagram, Whatsapp, Oculus and Mapillary. The company lost an estimated $163,565 per minute for the nearly six hours of downtime. That’s equivalent to $100 million – a massive amount, but for the present-day Meta, it is a manageable loss they easily endured.

Regardless of the size of your business, significant downtime in your operations can be quite costly and will negatively impact your bottom line. To avoid unnecessary downtimes, consider the expertise of a third-party IT service provider.

Hiring a third party to manage your organization’s IT infrastructure may come with additional costs. But how much? And are these costs worth the price? Learn more below.

Managed IT Services Pricing

Managed services can come in different forms. The type of services a Managed Service Provider (MSP) can provide ranges from something as simple as managing an organization’s devices to something as complex as handling their entire IT infrastructure and monitoring end-user systems. As such, pricing for these services are likely to vary.

A widely-cited Gartner report estimates the average global spending for managed IT services at between $10 to $250 per device per month. The exact rate may vary depending on:

  • The company’s niche
  • The MSP’s expertise
  • Features and complexity of the devices being managed

Additionally, other factors are also at play when determining managed IT services pricing. Let’s take a look at a few other factors that influence these costs.

Service Structure

Every service provider has its own pricing matrix. In the case of MSPs, they usually provide quotations based primarily on the service structure the customer chooses.

Managed services can be divided into the following structures:

  • Per User or Per Device: Companies with in-house IT infrastructure and full-time technicians often use this service structure. They have the resources and workforce to manage their day-to-day network use. However, their consumption and use of cloud services fluctuate regularly, making top-level enterprise service packages inefficient. Consequently, a per-user/per-device service is more cost-effective in comparison because companies only have to pay as needed.
  • Break-Fix Services: This is the most straightforward service structure for managed services. Under this arrangement, MSPs will only need to offer their expertise in case something “breaks,” such as in the case when there’s a security breach, downtime or any incident covered in the Service Level Agreement (SLA). As such, companies will only have to pay for the services provided, usually priced on an hourly basis.
  • Comprehensive Managed Services: Some companies want to outsource the management of an entire IT process or organization and subscribe to a complete slate of services, from installation and setup to troubleshooting and maintenance. This is ideal for companies that are too small to hire a full-time IT team or whose in-house IT capabilities are so limited that they need assistance from more knowledgeable and experienced IT professionals.

Expect your IT support provider to quote using these service structures as a baseline. Managed IT services pricing can increase depending on other factors discussed below.

Type of Managed IT Services

What services do you require from your MSP? Defining the inclusions of your SLA will further refine the quote you receive. Below are the types of managed IT support services you can outsource to an MSP:

  • 24/7 Helpdesk (for end users)
  • 24/7 technology support and troubleshooting assistance (for the company)
  • Remote and on-site infrastructure monitoring
  • Server hosting and management
  • Data backup and disaster recovery
  • Cybersecurity installation and management
  • Software as a service (SaaS)
  • Communication services
  • Data analytics

Each of these services would entail varying numbers of dedicated specialists, tools and levels of expertise and are accounted for when determining the price of your managed services.

Technology Upgrades

Most organizations make the decision to hire an MSP because of the software and/or IT infrastructure they’re offering. In this case, buying their product is the opt-in, and subscribing to their managed services is the long-term partnership. However, if the product has a fixed price point, the service pricing is often more flexible.

How outdated or up-to-date is your current setup? If your service provider has to set everything up from scratch, including designing your network infrastructure, expect the cost to go up. Likewise, if you already have some technology in place – say, you’re currently using Meraki software and hiring an MSP specializing in Meraki ecosystem services – then you may get a more affordable quotation.

Leasing Options

Some MSPs consider their services and expertise their primary offerings and their products or technology secondary. That being said, their effectiveness as IT support providers depends on their familiarity and knowledge of your existing infrastructure. Essentially, if you modify your IT infrastructure differently from their recommended setup, it will be very difficult for both sides to troubleshoot problems remotely when the time comes.

For this reason, many MSPs are strict about the hardware their customers use and the software standards they follow. It’s the only way for them to be 100% efficient at delivering their promised services. As such, some MSPs provide hardware that customers can rent. Leasing hardware that aligns with the MSP’s standards is a win-win situation.

Should you decide to lease hardware, you can expect the additional cost to be included in your SLA and monthly bill.

Extra Services

It has become customary for the service industry to be specific about the scope of their service packages. MSPs do the same. However, it doesn’t mean they will refuse to work extra hours or provide additional software support if their client needs it. They can still do so if staffing and resources permit but at a price. The terms and conditions for what services can be added on and the pricing structure (e.g., by the hour, by project) should be detailed in the SLA.

Protect Your Business With the Help of An Expert IT Management Service

Choose an established managed IT service provider with a reputation for top-notch services and reliability. E-Valve Technologies, a managed IT services company offering custom IT support, competitive service packages and world-class solutions, is ready to help.

We’ve provided high-quality managed IT services in New York, New Jersey and Connecticut for 15 years. Let us handle all of your IT needs and keep downtime at bay. 

Fill out our contact form to inquire. 

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