Is an MSP cheaper than hiring internal IT?

Usually below roughly 100 users, yes. Two blended IT salaries plus benefits, tooling, and licensing tends to land between $150,000 and $260,000 a year, while fully managed IT for 50 users at $125 to $195 per user per month lands between about $75,000 and $117,000 with the security stack included. Above roughly 150 users the math starts favoring a hybrid or internal team.

At what size should we hire our own IT person?

Ticket volume matters more than headcount, but most companies can justify a first internal hire somewhere between 75 and 150 users — usually paired with a co-managed agreement so one person is not solely responsible for security, after-hours coverage, and projects.

What is co-managed IT?

A split model where your internal IT keeps ownership of users and day-to-day support while an outside team supplies 24/7 monitoring, security operations, after-hours coverage, and project engineering. It is typically $65 to $110 per user per month on top of your existing salary cost.

Do we lose control of our environment if we outsource IT?

You shouldn't. Insist that your company owns the Microsoft 365 tenant, domain and DNS, licenses, and documentation, and that admin credentials are handed over on request. Any provider unwilling to put that in the agreement is relying on switching friction.

How do MSPs handle compliance frameworks like CMMC or HIPAA?

The credible ones treat compliance as recurring work: control mapping, a maintained System Security Plan and POA&M, continuous evidence collection, and assessor support. If compliance is quoted as a one-time project, expect the evidence to be stale by your next audit.

What hidden costs should we compare?

For in-house, add recruiting, benefits, training, certification, coverage during leave, and the security tooling and licensing an MSP normally bundles. For an MSP, ask what is excluded — after-hours rates, project labor, on-site visits, and onboarding fees are the usual gaps.

Decision Guide

MSP vs In-House IT: the honest comparison

What each model actually costs, where each one breaks, and the third option most mid-market companies end up choosing.

Start with data: 14 days of read-only monitoring, free.

Side by side, at 50 users

Ranges reflect typical Ohio-market rates. Your numbers move with compliance scope, infrastructure, and on-site expectations.

Factor	In-house IT	Managed IT (MSP)	Co-managed
Annual cost (50 users)	Roughly $150k–$260k for two blended IT salaries plus benefits, before tooling and licensing.	Roughly $75k–$117k at $125–$195 per user per month, tooling and security stack included.	One internal salary plus roughly $39k–$66k of coverage at $65–$110 per user per month.
Coverage	Business hours only. Vacations, illness, and turnover create real gaps.	24/7 monitoring with an on-call escalation path and no single point of failure.	Your team owns the day; after-hours, weekends, and holidays are covered.
Depth of skills	Generalists. Security, cloud architecture, and compliance usually get contracted out anyway.	Specialists on tap: security operations, network, M365/Azure, and compliance.	Your generalist plus specialists behind them for the work they shouldn't own alone.
Security tooling	Purchased separately — EDR, SIEM, email security, and backup licensing add up quickly.	Bundled into the per-user rate and managed by the people who deployed it.	Bundled, and your team keeps administrative visibility.
Institutional knowledge	Strong — until the person leaves and takes undocumented context with them.	Held in documentation and a team, not one head. Ask for documentation ownership in writing.	Shared, with documentation maintained as part of the agreement.
Compliance work	Usually the first thing to slip. Evidence collection is continuous, not annual.	Control mapping, SSP/POA&M maintenance, and evidence handled as recurring service.	Framework and audit support layered over your internal operations.
Scaling	Step-function: each new hire is a 3–6 month search and a fixed cost.	Linear: cost moves with seat count, up or down.	Linear on the outsourced portion, fixed on the internal portion.

Which model fits you

Build in-house

Best when scale and specificity justify fixed headcount.

You run highly custom line-of-business or engineering systems that need daily, deep context
You have 150+ users and enough ticket volume to keep several specialists busy
Your industry requires cleared or on-premises-only personnel
Executive expectation is a person physically present every day

Baseline your environment first

Outsource to an MSP

Best when you need coverage and depth for a predictable price.

You are under roughly 100 users and cannot justify two or three full-time IT salaries
Security and compliance obligations exceed what a generalist can maintain
Coverage gaps — nights, weekends, vacations, turnover — are already causing incidents
You want predictable per-user cost instead of unbudgeted emergencies

See what managed IT includes

Go co-managed

Best when you have internal IT that needs backup, not replacement.

You already have one or two capable internal IT people who are underwater
Projects keep stalling because day-to-day tickets consume the team
You need 24/7 monitoring and security operations, not more help desk
You want to keep control of the environment while filling capability gaps

How co-managed IT works

Decide on evidence, not a sales pitch

We monitor your environment for 14 days and hand you a written IT health scorecard — ticket patterns, patch gaps, backup status, and the fixes worth doing first.

Want the numbers first? See managed IT pricing

MSP vs In-House IT: the honest comparison

Side by side, at 50 users

Which model fits you

Build in-house

Outsource to an MSP

Go co-managed

Decide on evidence, not a sales pitch

Frequently Asked Questions

Related reading

Managed IT Pricing

Co-Managed IT

Switching MSPs

14-Day IT Health Check

CMMC Certification Cost

All Resources