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2026 Pricing Benchmark

Managed IT Services Pricing

Managed IT services typically cost $75 to $250 per user per month in 2026, depending on scope and company size. Below are the four standard service tiers with what is included at each, the per-user economics by company size, and the in-house versus MSP break-even.

Per User Per Month

$75 - $250

Depending on scope and company size

In-house Break-even

50 - 150 FTE

First IT hire often justified above this band

Co-managed Premium

$40 - $100

Per user per month for MSP layer alongside in-house IT

The Four MSP Service Tiers

MSP offerings cluster into four tiers in 2026. Each is appropriate for different company sizes and risk profiles. The pricing ranges below are typical North American MSP rates; UK and European pricing is similar, with some compression in tier-1 and tier-2 markets.

Basic break-fix MSP

$50 - $100/user/mo

Typically Included

  • +Help desk (business hours)
  • +Patch management
  • +Basic monitoring
  • +Antivirus or EDR licence
  • +Monthly reporting

Typically Excluded

Strategy, project work, security operations, after-hours, advisory.

Best For

10-50 user companies with low complexity, low compliance burden, predictable office-based work.

Standard managed IT

$100 - $180/user/mo

Typically Included

  • +Help desk (8x5 or 24x7 small surcharge)
  • +Patch and vulnerability management
  • +Backup management
  • +EDR + MFA management
  • +M365 / Google Workspace admin
  • +Identity and SSO administration
  • +Asset inventory
  • +Quarterly business reviews

Typically Excluded

vCISO services, deep cloud engineering, custom application support.

Best For

25-200 user companies. The dominant tier in the SMB and lower mid-market.

Fully managed (incl. security)

$180 - $300/user/mo

Typically Included

  • +Everything in Standard
  • +vCISO services
  • +MDR / SOC services
  • +Vendor management
  • +Cloud engineering hours
  • +Compliance support (SOC 2, HIPAA)
  • +Quarterly strategy reviews

Typically Excluded

Custom development, business analyst time on internal projects.

Best For

Compliance-sensitive 50-200 user companies. Healthcare, fintech, professional services with strong client expectations.

Co-managed IT (hybrid)

$40 - $100/user/mo + base

Typically Included

  • +Tier 1 help desk
  • +After-hours coverage
  • +Routine patching
  • +Backup verification
  • +Asset reporting
  • +Joint strategy sessions

Typically Excluded

Strategy ownership, architecture, project leadership, custom application work.

Best For

150-1000 user companies with in-house IT leadership, where MSP fills capacity and after-hours gaps.

MSP Cost by Company Size

Per-user pricing falls as headcount grows. The dominant explanation is operational leverage on the MSP side: a 25-user company and a 250-user company both consume similar onboarding and management overhead, and that overhead amortises across more users. Below is the typical 2026 cost curve for the standard managed-IT tier.

Company Size (FTE)Per-User Per MonthAnnual CostPattern
10 - 25 users$200 - $400$24k - $120kHigh per-user. Often basic break-fix tier.
25 - 50 users$150 - $300$45k - $180kStandard managed IT tier becomes affordable.
50 - 100 users$120 - $230$72k - $276kIn-house break-even appears in this band.
100 - 250 users$100 - $200$120k - $600kMany companies move to co-managed in this band.
250 - 500 users$80 - $150$240k - $900kCo-managed dominates here. Pure MSP rare.
500+ users$40 - $100$240k - $720k+MSP layer is supplement, not primary IT operations.

Pricing benchmarks from ChannelE2E MSP 501 annual list, ConnectWise MSP benchmark surveys, and Service Leadership Index data.

MSP vs In-House IT: The Break-even Math

The decision to retain an MSP versus build an in-house IT function is the most common IT budget question for 50 to 200 person companies. The break-even depends on three variables: company size, scope of work expected, and the cost of a comparable in-house hire.

For a 50-person company, the math is generally favourable for an MSP:

  • Standard MSP cost: $90,000 to $150,000 per year. Covers help desk, patching, security, M365 admin, vendor management, monthly reporting.
  • Single in-house IT generalist: $95,000 to $140,000 fully loaded. Covers similar scope but with much narrower skills depth and single point of failure (vacation, illness, leaving).
  • MSP wins on skills breadth and resilience. A 50-person company that needs occasional security expertise, cloud architecture review, or compliance advice gets it from the MSP without hiring those specialties.

For a 250-person company, the math typically flips:

  • Standard MSP cost at 250 users: $360,000 to $720,000 per year. That covers the same scope at scale.
  • In-house IT team of 4-6 FTEs: $400,000 to $800,000 fully loaded. Plus MSP retainer for after-hours and specialty work ($60,000-$150,000) brings total to $460,000-$950,000.
  • In-house wins on responsiveness and strategic alignment. An MSP cannot drive an internal ERP migration or ride-along on M&A integration the way an in-house team can.

Between 50 and 250 employees the right answer depends on industry, compliance scope, and the leadership profile of the company. Most companies in the 100-200 employee band pick co-managed (in-house IT lead plus MSP for operational depth), which is why this is the dominant model in 2026.

Related Pages

IT Budget for 50 Employees

Where MSP economics are most favourable.

IT Budget for 250 Employees

Co-managed IT becomes dominant.

IT Staffing Costs

In-house IT salary benchmarks for break-even math.

Cybersecurity Budget

MSSP and managed detection pricing.

Small Business IT Budget

SMB IT planning, MSP fits naturally.

Full Budget Breakdown

Five-category context for MSP costs.

Calculate your IT budget with MSP costs

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Frequently Asked Questions

What does a managed services provider (MSP) cost?
MSP pricing in 2026 typically runs $75 to $250 per user per month, depending on scope and company size. The variance is enormous: a basic break-fix retainer for a 25-user company can be $50 per user per month; a fully managed offering with EDR, vCISO services, vendor management and 24/7 support for a 200-user company can hit $300+ per user per month. The dominant pricing model is per-user-per-month all-inclusive (PUPM AI), which has displaced the older per-device or hourly models for any retainer-style relationship.
What is included in a managed services contract?
Standard inclusions in a 2026 mid-market MSP contract: tier 1 and tier 2 help desk (8x5 or 24x7), patch management, backup management, EDR licensing and management, M365 or Google Workspace administration, basic identity and SSO administration, asset inventory, monthly reporting, and quarterly business reviews. Common add-ons (priced separately): vCISO consulting, security operations centre (SOC) services, network monitoring, dedicated cloud engineering, project work, IT strategy consulting, training, and after-hours emergency response.
How does MSP pricing differ by company size?
Per-user pricing falls as company size grows due to operational economies. At 10-25 users, expect $200 to $400 per user per month for basic MSP services. At 25-100 users, $150 to $300. At 100-500 users, $100 to $200. Above 500 users most companies move from a pure MSP relationship to co-managed IT, where in-house owns strategy and the MSP handles operations, with pricing more typically $40 to $100 per user per month for the MSP layer plus internal IT salaries.
When does it make sense to hire an MSP vs go in-house?
The break-even is between 50 and 150 employees in most cases. Below 50 employees, the cost of a single fully loaded IT generalist ($95k-$140k loaded) often exceeds what a competent MSP would cost ($50k-$120k for a 50-user company), and the MSP brings broader skills than any single hire. Above 150 employees, pure MSP economics start to lose to in-house plus a smaller MSP retainer for after-hours and specialty work. The decision is rarely binary; most 100-300 person companies run a hybrid co-managed model.
What is co-managed IT and how is it priced?
Co-managed IT is a hybrid model where in-house IT owns strategy, architecture and high-priority work while a managed services provider handles tier-1 help desk, after-hours coverage, routine patching and lower-priority requests. It is the dominant model for 150 to 1,000 employee companies. Pricing typically runs $40 to $100 per user per month for the MSP layer (less than full MSP because in-house team takes the bigger jobs), plus $5,000 to $15,000 per month base retainer for vendor management and reporting.
What is an MSSP and how is it priced?
MSSP (managed security services provider) is a security-specialised version of an MSP. The category includes pure-play MSSPs (Arctic Wolf, Red Canary, Expel) and security divisions inside larger MSPs. Typical pricing is $20 to $80 per user per month for endpoint protection plus 24/7 SOC monitoring, $80 to $200+ per user per month for full managed detection and response (MDR) including incident response. MSSP services are often bundled with a separate IT MSP or run alongside in-house IT.

Updated 2026-05-11