Cloud Managed Services Pricing Options & Benefits

Aug 12, 2022


Cloud-managed services is not an exclusive business model but a value-added offering that allows technology companies to wrap their technical expertise around their clients’ businesses. Great Cloud Managed Service Providers (MSPs) are not just a one-off vendor; they are trusted advisors who provide well-rounded solutions to customer needs.

Managed services centers exactly on what the name implies: Services, provided as part of a long-term customer relationship. And different technology companies structure and price their managed services offerings differently based on how they deliver services and staff their teams. 

Cloud Managed Services Pricing Models

Full-Time Employee Model (staffing)

Typically, larger enterprises leverage staffing services to manage and support a set of infrastructure with a minimal SLA. This model is also sometimes referred to as staff augmentation. It involves hiring additional resources through another technology company. The main goal is to support your need to fill a skill or knowledge gap without adding the overhead of hiring your own staff.

As-a-Service or Subscription-Based Services 

This option allows for increases and decreases in service without penalty or long-term commitment for the services provided. This model is typically more expensive than others due to the lack of long-term commitment. In addition, the service is typically very rigid and narrowly defined, which may skip some of the requirements you need for your environment.

Pricing Per Unit, User, Device 

This model typically includes a dedicated Customer Success Manager (CSM) who understands your business goals and technology needs. This CSM works with their team of deeply technical cloud architects and engineers to ensure you meet those business goals leveraging their skills and overall technology roadmap for your business. Organizations that correctly adopt this model include innovation and continued adoption of modern infrastructure and emerging technologies, which also allow for cost optimization and consistency of communication and innovation across the organization. Services are typically defined with a Service Level Agreement (SLA) to ensure performance.

Traditional IT Services vs. Cloud Managed Services Partners

Traditional IT Service Providers

Traditional IT centers on staffing and a "break/fix" product and project-based work model. These services often focus on "fixing symptoms" of systemic technology problems; this model leads to tool sprawl and a disjointed mix of solutions. With a lack of future-focus strategy and innovation-based project planning, customers do not have the opportunity to leverage technology to drive business results. Even worse, these service providers tend to include Security as an "add-on," which puts customers at significant risk in today's dynamic threat landscape.

Cloud Managed Service Provider

On the flip side of traditional IT services are cloud-managed services, which are the opposite due to their consulting-led proactive approach along with the following:

  • Single vendor focus minimizes toolsets, complexity, and total cost of ownership, enabling current technology through the best-of-breed Microsoft stack.
  • Security and compliance are built into the foundation of the service.
  • Managed Security Operations Center powered by cloud-native SIEM-based managed detection and response.
  • Leverages automation-first approach for operations.
  • Improved monitoring by focusing on end-user experiences.
  • Optimization and innovation-focused.
  • Transformation of the business leveraging emerging technologies and innovation.
  • Enables strategic business results while also solving technical problems.
  • Focuses on building automation to reduce their risks and cost, as well as to enable customers to innovate.

A true Cloud MSP helps customers transition to and embrace new technologies by guiding them in all aspects of their cloud journey. They employ proactive engagement with IT and an overall business strategy. A Cloud MSP will look at the business as a whole and understand how IT strategy can impact an organization, whether for end-user satisfaction internally or customer satisfaction externally. This new breed of technology partner will always look for ways to increase a business’ speed-to-market by deploying automation and modernizing traditional server infrastructure to utilize more modern serverless and/or platform services such as Microsoft Azure DevOps, Kubernetes, App Services, and Database-as-a-Service options. From consulting to migrations to operations management, Cloud MSPs show customers all the benefits that come with making a move to the cloud.

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