4 Ways You’re Losing Money by Not Using Managed Hosting

Nikole Haiar, June 18, 2015 POSTED IN:Hosting & Tech News

One of the most attractive benefits of managed hosting services is the opportunity to save money that can then be put toward other mission-critical areas of the business. The managed hosting industry has consistently grown in recent years, and for good reason. Managed hosting not only helps an organization become more agile and efficient, but can also save considerable capital when carried out effectively.

According to a February report from Markets and Markets, the cloud infrastructure services market is poised to increase from the $55.73 billion generated in 2014 to a staggering $93.50 billion by 2019. This compound annual growth rate of 10.9 percent signals a considerable rise in adoption, reflecting that enterprises are increasingly turning to managed service providers to reap the benefits of hosted cloud, platform-as-a-service and other offerings.

So what are those yet to move to managed hosting missing out on? One of the most attractive benefits of managed hosting services is the opportunity to save money that can then be put toward other mission-critical areas of the business. Here’s where that savings comes from:

1) The high cost of equipment
When businesses opt to host their own infrastructure and applications they have to purchase a considerable amount of equipment, including the servers, network switches, racks and other components necessary to support the organization’s online activities. These machines do not come cheap.

When looking at cloud-based infrastructure, the cost of equipment, software and installation can run a business $14,000 or more, just for the initial setup, according to TrialWorks. When an organization leverages managed services, however, they don’t have to purchase and establish their network, saving them thousands of dollars in hardware and software costs.

2) Regular maintenance and upgrades
The costs don’t end there: Those hosting on their own infrastructure must also consider the price of regular maintenance and the necessary upgrades carried out by their own IT team. TrialWorks noted that proactive maintenance and monitoring can cost about $350 each month, totaling $4,200 for the entire year.

With managed services, the service provider’s staff is responsible for ensuring that hardware and software is always up-to-date and operating at its best.

3) Time and effort on the part of the IT team
An on-premise server environment requires a lot of time and effort from the company’s IT team. These hours can cost the company a significant amount in wages.

You might think, “I’m paying these employees anyway, why not have them work on our on-premise infrastructure?” But using your staff this way pulls them away from other activities, meaning you might not be leveraging your IT team in the most effective manner. Managed hosting enables these employees to take on other mission-critical tasks and projects while the equipment is maintained by the provider.

4) Overall efficiency and flexibility
At the end of the day, managed services allow you to sever the tethers forcing the IT team and other key staff members to leverage their valuable time and expertise managing the on-premise configuration. Surely, these employees have more to offer the organization, and can better support its success, than making upgrades and maintaining the server environment.

Partnering with a managed service has a number of other advantages as well. To find out more, contact Hostway today.