Key Points:
- MSP pricing often hides real costs behind simple per-user or per-device quotes.
- Extra hardware, licensing, compliance, usage fees, SLA limits, onboarding, and contract escalators can raise monthly bills 30–70% above the quote.
- True cost clarity comes from defining scope, auditing add-ons, capping hours, and aligning SLAs to business impact.
Thinking “how much do MSPs charge?” seems straightforward if you look only at monthly quotes. Many providers quote you a per device or per user price, and you assume that covers everything.
That simplicity can hide a lot of cost risk. Behind that quote lie many assumptions: what “device” means, what “user” includes, what services are actually covered, what response times you’ll get, which add-ons are extra, what the contract length is, and so on.
Below are the common hidden costs people only discover after the contract is signed, plus other useful facts so you can spot when something is off.
Common MSP Hidden Costs to Watch For
Many Managed Service Provider (MSP) clients assume the quoted MSP costs or cost of managed IT services will include everything. Often they don’t. These MSP hidden costs include:
- Extra hardware and infrastructure: MSP proposals may include monitoring and support but exclude new switches, servers, or firewalls. Older gear may also need upgrades, creating surprise invoices tied to hardware and software sales.
- Licensing and third-party tools: Costs for antivirus, backup, or Microsoft 365 licenses may be missing or underestimated. Adding users or changing software can raise fees quickly.
- Scope creep: Contracts may limit devices or users without clear rules for BYOD, mobile gear, or legacy systems. Special setups take more support time and increase costs.
- Overage and usage fees: Exceeding support hours, storage limits, or on-site visits often triggers extra charges. Backup storage and cloud spikes can also raise bills, especially when backup and disaster recovery scales behind the scenes.
- Contract terms and renewals: Low starter rates may rise at renewal. Long agreements or early termination penalties can lock you into higher prices.
- SLA limits: Response times, after-hours help, or “priority” tickets may cost more. Issues outside business hours often bring fees or delays.
- Security and compliance: Meeting standards such as HIPAA or PCI-DSS often adds audits, reports, and controls handled under cybersecurity services.
- Migration and onboarding: Audits, agent installs, and data moves often carry one-time setup fees during cloud migration.
- Non-standard environments: Custom apps, hybrid clouds, or older hardware usually need extra work that leans on IT project management.
- Hidden fees and fine print: Travel, training, data exports, or consultant time can appear as line items. Taxes and regulatory charges may also be billed separately.
Each of these can add up. What may look like a $1,000/month MSP contract can realistically become $1,300-$2,000/month once these are included, or worse, be unpredictable.
For example, when a ticket drags past SLA, internal teams wait. Those delays carry a real price, because employee time is not free. Recent data puts total employer compensation in the private sector at $45.65 per hour on average, which means stalled work burns dollars even if the MSP fee stays flat.
Red Flags to Spot Before Signing (Avoid Being Surprised)
Before committing, ask questions and demand clarity where you see these red flags. Transitioning from assumption to informed decision takes effort but protects you long-term.
- “What’s in and what’s out?” Get a detailed list of what devices, software, services, and hours are included. Ask explicitly about mobile devices, remote user setup, and custom integrations.
- Check definitions in contract: What counts as a “device”? What defines “user”? What constitutes “after-hours”? What is “emergency” vs “critical”?
- Audit licensing terms: Who owns or pays for the licenses for software, tools, backup, monitoring? Will there be cost increases over time due to license changes or vendor price hikes?
- Review SLA carefully: Response times, support hours, uptime, penalties if SLAs aren’t met. Know whether you’ll be charged more for urgent cases.
- Get onboarding & setup fees in writing: Is there a one-time setup cost? Is migration included? If partial, what’s extra?
- Ensure you have flexibility clauses: For adding/removing devices/users, expanding scope, or terminating the contract without punitive fees.
- Forecast long-term rises: Ask about annual price escalators, inflation, renewal cost increases. Ensure you know what will happen after the “introductory” period.
- Understand usage and overage charges: For backup data, cloud services, remote access, and extra help-desk hours. They may seem small but accumulate fast.
- Check security/compliance add-ons: If your business needs regulatory compliance, ensure all related tasks are part of the core quote, not bolt-ons.
- Ask for references or case studies with businesses similar in size/needs to yours: Their actual monthly costs (including hidden ones) are the most telling.
Real-World Example: How Hidden Costs Balloon
Consider a business with 30 users, each using 1 desktop, 1 laptop, and 1 mobile device. MSP quotes per user pricing of US$80/user/month. Based on that, the cost looks like 30 × 80 = US$2,400/month.
But after contract signing, they discover:
- Mobile device support & licensing was extra → add US$10-15/user → + US$300-450/month
- Backup storage overage when data grows → US$500/month
- On-site visits for remote locations charged separately → US$200/month
- Upgrading file servers (old, failing hardware) not in contract → purchase/installation cost spread over months → extra US$800/month equivalent amortized
- After-hours support when someone must work late → charged at a premium rate → US$250 monthly
Total real cost ends up at about US$3,700/month or around 54% more than the original quote.
SLA Fine Print: Credits That Don’t Cover Your Losses
SLA language looks protective. Response times. Resolution targets. Availability goals. The catch comes with how credits work. Many SLAs pay partial credits against the monthly fee, not the business impact.
Credits often exclude third-party outages and planned maintenance, which still trigger monitoring and escalation inside a security operations center (SOC).
For incidents that include ransomware or extortion, the gap grows. The latest research links ransomware to 75% of system-intrusion breaches in this year’s major industry report, which means a real share of impactful incidents will stress SLAs that were written for routine tickets.
SLAs should tie to what your teams feel when systems are down: idle staff, missed orders, and delayed projects. If credits only reduce next month’s MSP bill by a small percentage, they will not offset the internal costs of disruption.
Comparing Per-Device vs Per-User Pricing Models
Per device pricing and per user pricing are two common ways managed IT services get quoted. Each has pros & cons and risks of hidden costs.
Per-Device Pricing:
- Each device (desktop, server, mobile) gets a flat monthly fee.
- Comfortable if you have many devices per user or mixed device types.
- Hidden cost risk: vendors might price devices differently. A server might cost much more. Also, adding many small devices (phones, IoT, tablets) can increase costs unexpectedly.
Per-User Pricing:
- Covers every device a user owns for one flat rate. This works well when users have several devices.
- Many clients find this model easy to understand. Support costs can rise, though, if a user runs heavy or specialized equipment.
Both models benefit MSPs when clients’ environments are stable. They both break down when there’s heavy device churn, many “non-standard” devices, lots of software variety, compliance needs, or remote/hybrid work setups.
Evaluate Total Value and Not Just the Sticker Price
The cost of MSP should include prevention, speed, and clarity. Low base rates with vague scope shifts spend into rework and outages. Higher base rates with clear inclusions, hard caps, and shared tools often deliver lower total cost.
When comparing proposals, build a common view:
Standardize the RFP so you can compare apples to apples:
- One sheet with device counts, user counts, apps, and sites
- A traffic profile (tickets per month by category) from your current system
- A security baseline list that every bidder must include in the flat rate
Score each MSP across four cost drivers:
- Coverage: what is in the flat rate vs. add-ons
- Change: how routine changes are handled and priced
- Incident: what caps, retainers, and response guarantees apply
- Exit: how easy it is to leave with your data, logs, and configs intact
Add a scenario test. Hand each MSP the same mock incident and ask for the playbook, roles, hours, and tools. The responses reveal where hidden costs would appear on your invoices.
Put It All Together: A Contract You Can Live With
You can control MSP costs by writing clarity into the agreement, measuring what drives spending, and owning the parts of the stack that anchor your security and compliance. A few precise changes will reset the relationship and remove surprises:
- Define scope down to versions, modules, and cloud tenants.
- Convert common “projects” into fixed-price service packs.
- Cap reactive hours and require trend reviews if caps get hit.
- Include incident response retainers and logging retention inside the flat rate.
- Keep ownership of tenants, configs, and evidence so transitions stay clean.
One more point on risk: even with better contracts, the cost of a major breach dwarfs small savings on monthly fees. In this year’s data, ransomware holds a large share of system-intrusion breaches, and breach costs remain in the multi-million-dollar range globally.
This is why identity, endpoint, backup, and recovery live in the base and not as optional extras. The dollars at stake justify the shift.
Frequently Asked Questions
How much do MSP services cost?
MSP services cost about $150–$400 per user per month, with monthly totals like $3,500–$5,500 for 35 users. Pricing varies by scope of services, compliance needs, 24×7 support, and number of sites. Most providers use per-user quotes, but per-device and hybrid models also appear in bids.
What are the hidden costs?
Hidden costs in MSP services include onboarding fees equal to one to two months of service, setup extras, hourly billing for projects or migrations, and surcharges for on-site visits, after-hours support, new users or devices, excluded hardware, and compliance audits. Licensing waste, like over-provisioned Microsoft 365 also inflates spending.
What does MSP mean in pricing?
MSP in pricing means managed service provider billing. MSP pricing models include per user (one flat fee covering an employee’s devices), per device (fees by desktops, laptops, servers), tiered or flat-fee bundles, and à la carte add-ons. Per user simplifies forecasting for multi-device staff, while per device fits equipment-heavy setups.
Get Transparent IT Costs Without the Surprises
Technology solutions in Cincinnati help local teams set a clear scope, cap reactive work, and standardize security inside the flat rate so invoices match expectations. At LK Tech, we focus on contracts that define coverage, set change rules, and include tested recovery so you are not paying by the hour when stress is highest.
If you want a quote that shows both the visible and hidden costs, reach out. We’ll walk you through what the cost of managed IT services truly means for your business. This way, you can budget well, avoid surprises, and focus on growth.
