How Much Should You Pay For Managed Hosting?

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How Much Should You Pay For Managed Hosting?

Deciding how much to budget for managed hosting is crucial yet confusing. With costs varying wildly, how do savvy buyers balance performance and support needs versus overspending? This article details the key factors shaping managed hosting pricing, reveals real-world price ranges, and provides expert guidance for getting premium managed services without breaking the bank. 

Factors That Determine Managed Hosting Costs

Service Level and Uptime Guarantee

When evaluating managed hosting providers, one of the most important factors to consider is their service level agreement (SLA) and uptime guarantee. An SLA outlines the level of service and performance standards a customer can expect from the hosting provider. A key component of an SLA is the guaranteed uptime percentage.

Standard uptime guarantees in the managed hosting industry tend to range from 99.9% to 99.99%. The higher the uptime percentage, the less potential downtime the site will experience. Even a difference of 0.1% can equate to over an hour of additional downtime per month. For mission-critical sites where continuous uptime is paramount, a 99.99% or greater SLA may be advisable despite the higher cost.

The consequences for not meeting the SLA’s uptime guarantee are also important to review. Most providers offer pro-rated service credits when downtime exceeds the SLA. More robust SLAs also include penalties for chronic underperformance. When downtime could result in substantial revenue losses, stronger SLA guarantees and penalties better protect the client’s interests.

Ultimately, managed hosting providers with higher service levels and stronger uptime guarantees justify charging higher monthly fees. Their infrastructure, staffing levels, and operations management capabilities allow them to confidently meet higher performance standards. Clients wanting air-tight reliability will pay a premium for guaranteed service levels.

Bandwidth and Traffic

Bandwidth usage and website traffic volume also factor heavily into managed hosting costs. Providers allocate monthly data transfer limits for each hosting account. Basic packages may include only 10-100 GB of bandwidth, while high-end offerings provide 1 TB (1024 GB) or more.

Overage fees based on bandwidth utilization above the allocated limit can add up quickly. For sites anticipating more than 25,000 visitors per month, higher-bandwidth packages are likely the better value. Carefully monitoring traffic growth allows proactively scaling to higher limits before overages accrue.

Managed hosting providers optimize plans based on typical bandwidth needs at various traffic levels. Shared platforms maximize efficiency for lower-traffic sites by pooling resources. High-volume sites may benefit from dedicated bandwidth allocation which avoids noisy neighbor problems during peak usage.

In addition to bandwidth limits, managed hosting pricing accounts for overall visitor traffic. More page views and monthly visits drive increased computing and delivery costs for the provider. Consequently, plans and pricing tiers are structured based on typical traffic needs. High-volume site packages come at a steeper monthly price, but greater efficiency compared to exceeding resource limits on lower-tier plans.

Storage Space and Websites Hosted

Storage space and the number of websites hosted on an account are other key managed hosting cost determinants. At the low end, plans may include just 10-100 GB of disk space. This allows hosting a single site comprising mostly text and smaller image assets. More advanced sites with multimedia content and numerous asset files will routinely exceed these basic storage allowances.

Higher-tier plans accommodate larger disk space, with 1-2 TB now common on mid-range offerings. Enterprises managing multiple hosted sites or applications may require 10 TB or more of allocated storage. Again, overage fees apply when exceeding the included space, so proactive monitoring and upgrading are advised.

The number of distinct sites or applications hosted on an account also impacts managed hosting costs. Shared platforms maximize efficiencies for single smaller sites. However, organizations hosting multiple web properties or apps are better served by plans allowing segregated hosting environments and resources not shared across sites. These dedicated and isolated hosting capabilities understandably come at a premium price point.

Managed hosting providers structure pricing plans across various tiers based on factors like service levels, bandwidth, storage space, and number of hosted sites. Identifying current usage and projected needs makes selecting the optimal balance of features and price possible. Monitoring growth patterns helps avoid surprise overage fees down the road.

Key Factors Influencing Managed Hosting Costs:

This table outlines the main factors that determine the costs of managed hosting. It helps businesses understand what aspects they need to consider when budgeting for their hosting needs.

Factor Description Impact on Cost
Service Level and Uptime Guarantee The level of service and uptime percentage guaranteed by the provider. Higher uptime percentages imply better reliability but at a higher cost. Higher SLAs increase costs.
Bandwidth and Traffic Monthly data transfer limits and visitor traffic volume. Plans with higher bandwidth and traffic capacity are more expensive. More bandwidth = higher cost.
Storage Space The amount of disk space provided for website files and content. More storage space generally results in higher costs. More space = higher cost.
Number of Hosted Sites The number of websites or applications hosted on an account. Plans supporting multiple sites often cost more. More sites = higher cost.
Technical Support and Expertise The level of technical support and expertise offered by the hosting provider. More comprehensive support and managed services command a premium. Better support = higher cost.

Average Costs of Managed Hosting

Shared Hosting Plan Costs

Shared hosting is the most affordable managed hosting option, ideal for new or smaller-traffic websites. In a shared environment, multiple sites utilize the same server resources. Unmanaged shared hosting typically starts around $3-10 per month.

With managed shared hosting, prices reflect the added support and optimized performance the provider configures and maintains. Average starting prices range from $15-50 per month for entry-level plans. Mid-tier offerings with more robust features and bandwidth usually span $50-100 per month. Premium managed shared hosting with advanced functionality and resources can cost $100-250+ monthly.

Compared to unmanaged, the higher monthly fees of managed shared hosting reflect extensive configuration, monitoring, optimization, security, and assistance provided by the hosting provider. Essentially, clients pay for the specialized expertise and effort required to actively maintain optimal uptime and performance.

Ongoing oversight also allows proactively adjusting plans and resources as site traffic grows. Shared hosting works well for sites receiving up to around 100,000 visits per month. Beyond that threshold, the potential for noisy neighbours and resource constraints makes upgrading to VPS hosting advisable.

VPS Hosting Plan Costs

For sites that outgrow shared hosting, VPS (virtual private server) hosting isolates resources allocated to each account for better performance and control. Rather than sharing a physical server, each site gets a portioned virtual server optimized for its needs. Average starting prices for managed VPS hosting generally range from $40-100 per month.

VPS hosting also scales across plan tiers differentiated by computing power, RAM, storage, and bandwidth limits. An entry-level VPS may include just 1-2 CPU cores, 1-2 GB of RAM, 30-60 GB of storage, and 2-4 TB of monthly bandwidth.

Mid-range plans typically offer 4-8 CPU cores, 4-8 GB of RAM, 80-120 GB of storage, and 4-6 TB of bandwidth. High-end managed VPS packages scale up to 16+ CPU cores, 16+ GB of RAM, 200+ GB of storage, and 8+ TB of monthly bandwidth. Average costs for these mid to high-end plans span $100-300 per month.

The isolated environment and scalable resources of managed VPS hosting suit sites receive 100,000 to 500,000+ visits per month. Dedicated servers offer the next level up for even higher traffic loads.

Dedicated Server Costs

For organizations with heavy traffic, complex apps, or stringent performance requirements, dedicated server hosting provides the ultimate control and customization. Dedicated servers are physical pieces of hardware devoted exclusively to one client’s sites and apps.

Managed dedicated server hosting averages $150-500 per month for entry-level single-server configurations. Mid-range dual-processor servers with more RAM and storage average $500-1000 monthly. Enterprise-class multi-processor servers with ample resources for supporting large-scale web properties routinely cost $1000-5000+ per month.

The main premium paid for managed dedicated servers is continuous expert configuration and systems administration the client doesn’t provide themselves. Costs directly correlate with the hardware capabilities, performance potential, and level of customized management provided.

Dedicated server hosting manages 500,000+ monthly visits and anything requiring truly optimized speed, scale, and reliability. The specialized attention and robust infrastructure come at a significantly higher, yet often justifiable, price point for high-demand sites and applications.

Managed Hosting Plan Cost Comparison:

This table provides a clear comparison of the average costs associated with different types of managed hosting plans. It categorizes the costs into Shared Hosting, VPS Hosting, and Dedicated Server costs, giving potential customers a straightforward view of what they might expect to pay.

Hosting Type Entry-Level Cost (Per Month) Mid-Range Cost (Per Month) High-End Cost (Per Month)
Shared Hosting $18 – $60 $60 – $120 $120 – $300+
VPS Hosting $48 – $120 $120 – $360 Custom Pricing
Dedicated Servers $180 – $600 $600 – $1,200 $1,200 – $6,000+

Comparing Managed and Unmanaged Hosting Costs

Pricing Differences

Managed hosting services come at a premium cost compared to unmanaged hosting. With unmanaged plans, clients are essentially renting server space and bandwidth. The hardware and network are provided, but configuring software and handling maintenance is largely the client’s responsibility.

Unmanaged VPS hosting may cost as little as $10-20 per month. Unmanaged dedicated servers run $100-250 monthly. Support is minimal, and the uptime SLA if any is generally around 99%. The servers are online and available, but performance optimization, security, updates, and troubleshooting are self-managed.

For managed hosting, clients pay significantly higher monthly fees for the provider’s expertise in managing the extensive administrative duties unmanaged customers handle themselves. Managed VPS hosting starts at around $50 per month and dedicated servers are around $150 monthly at the low end.

The markup pays for the staff, tools, and systems to actively configure, monitor, tune, secure, patch, and support each server. Optimizing for performance and handling issues quickly costs more in labour than just maintaining basic hardware operations. But for complex or business-critical sites, it is often worth the premium.

When Managed Hosting Is Worth the Extra Cost

While pricier, managed hosting justifies the higher costs for several scenarios:

  • Sites, where uptime is critical, cannot afford the risks of DIY administration and firefighting downtime. Paying more for expert management maximizes uptime.
  • Clients lacking server administration expertise are unable to optimize configuration themselves and benefit greatly from the provider managing it for them.
  • The labour investment for proper unmanaged hosting administration often exceeds the cost premium of outsourcing it to managed experts.
  • Configuring hosting for optimal security and updating for vulnerabilities is complex, time-consuming, and vital. Managed services take care of this crucial task.
  • Performance tuning, troubleshooting configuration issues, and resource optimization require significant non-core focus for unmanaged clients. Managed services focus extensively on this.
  • Sites experiencing rapid growth or seasonal spikes benefit from the scalability and flexibility of managed hosting solutions.
  • Businesses for whom hosting infrastructure is non-core should focus on their core competencies and outsource hosting administration and operations to experts.

Recommendations for Cost-Conscious Customers

For customers wanting managed hosting reliability and support without overspending, several options exist:

  • Managed cloud hosting like Amazon AWS, Microsoft Azure, or Google Cloud provides world-class infrastructure management, uptime, and flex scale capabilities for much less than equivalent dedicated servers.
  • Negotiating longer contract terms can lower monthly fees, but reduce flexibility. Month-to-month managed hosting is ideal for agility but comes at a higher rate.
  • Seek month-to-month plans allowing scaling resources up and down as needed instead of overprovisioning excess capacity. Optimization eliminates waste.
  • Leverage open-source and free management tools to self-handle basic tasks like monitoring and leave more advanced care to managed providers.
  • For non-mission-critical experiments or temporary projects, opt for unmanaged hosting and tolerate more issues until successfully proven and traffic warrants professional management.
  • Work with providers catering to SMBs and startups willing to provide high-touch service without premium enterprise pricing.

With some savvy shopping and optimizations, businesses on a budget can still benefit from managed hosting reliability and performance without overspending. The trade-off is investing more sweat equity to avoid higher fees.

Choosing a Reliable Managed Hosting Provider

Researching Providers

Selecting the right managed hosting provider is critical for delivering the performance, reliability, and support your business needs. Take time upfront to thoroughly research multiple providers before making a decision.

Start by identifying several reputable companies with managed offerings in your desired service category like shared hosting, VPS, or dedicated servers. Consulting hosting review sites can surface top providers based on technology, customer satisfaction, capabilities, and pricing.

Evaluate each short-listed provider’s website closely. Look for transparency about their infrastructure, tools, staff expertise, service level guarantees, and security provisions. Compare tiers of plans and pricing to align with your current and projected needs.

Request free trials or demo accounts to test performance and early support experiences first-hand. Running your actual workloads and benchmarks generates insights unlikely gleaned from just brochures. Be wary of providers unwilling to provide trial access.

Reach out to sales representatives with probing technical questions to assess competency. Existing client testimonials and case studies also reveal whether they have successfully served companies with needs similar to yours.

Review third-party analyst reports profiling providers when available. Compiled statistics on uptime history, customer satisfaction, market share, and capabilities offer impartial insights.

Checking social media and forums can uncover candid feedback on support responsiveness, technical competence, business practices, and overall sentiment. Research thoroughly before committing.

Key Criteria to Evaluate

Several criteria should guide your provider evaluation process:

Reliability and Performance Track Record – Look for a consistent 99.9%+ uptime history across their client base, not just cherry-picked showcase accounts. Well-run infrastructures and operations minimize the risk of downtime.

Technical Expertise and Experience – Their team should demonstrate deep expertise across server configuration, application optimization, patching, troubleshooting, and security. Tenured staff indicate stability.

Customer Support Capabilities – 24/7 quick response support is mandatory. Look for breadth across email, phone, chat, and self-service knowledge base channels.

Reputation – Favorable client reviews, analyst ratings, press mentions, community sentiment, and case studies signal providers are well-regarded for delivering quality managed hosting services.

Alignment with Your Needs – Match their offerings, experience, pricing, and support model to your specific use case, traffic, budget, in-house capabilities, and growth trajectory.

Flexible Scaling Options – Growing sites need hosting solutions allowing fluid scaling up server resources and bandwidth as needed to match demand.

Warning Signs to Avoid

Some red flags to watch out for when evaluating providers:

  • Very limited public information on infrastructure, security practices, and internal operations. The lack of transparency is concerning.
  • Uptime or performance promises are seemingly too good to be true. Verify against third-party data.
  • Scant reviews from customers identifiable as real organizations.
  • Negative sentiments around support being difficult to reach or unknowledgeable.
  • Indications of frequent account suspensions due to excessive resource usage.
  • Lacking capabilities around managing platforms critical to your stack like WordPress or Magento.
  • Cookie-cutter packages only without customized solution design abilities.
  • Unwillingness to provide trial accounts or reference customers in similar industries.
  • Excessively cheap pricing likely signals infrastructure or staffing insufficient for reliable managed services.

Carefully vetting providers using these tips helps identify high-quality partners best positioned for securing your apps and sites with expert-managed hosting. Settling for less risks headaches from mediocre uptime, support frustrations, and subpar performance.

Benefits of Managed Hosting

Guaranteed Uptime and Reliability

One of the primary benefits of managed hosting is significantly higher guaranteed uptime and reliability compared to unmanaged options. Leading managed providers offer 99.9% or 99.99% uptime SLAs consistently across clients.

The financial penalties they pay out for unmet SLAs incentivize extensive redundancy, failover systems, and proactive monitoring to minimize downtime risks. With unmanaged self-hosting, you alone bear the costs of any lost revenue from slow sites or outright downtime.

Managed hosting experts also optimize server configurations for maximum stability, security patching, and disaster recovery protections most customers can’t replicate alone. The collective experience of supporting many clients gives them greater mastery over reliability best practices.

Rather than waking up to crisis alerts, managed clients sleep soundly knowing experts are vigilantly ensuring 24/7 availability. For e-commerce sites and digital platforms where continuous availability is business-critical, guaranteed uptime and resilience are compelling managed hosting benefits.

Technical Expertise and Support

Accessing specialized technical expertise and support is another major upside of managed hosting services. Installation, upgrades, troubleshooting, security, and optimization require significant hands-on server admin and DevOps experience most organizations lack.

With managed services, you gain a team of hosting experts available 24/7 to handle any issue. The breadth and responsiveness of support capabilities far surpass what in-house staff realistically provide.

Proactive monitoring and preventative measures also minimize problems before they snowball into application failures or performance drags. The collective experience amassed working with many clients gives managed providers greater diagnostic instincts and troubleshooting agility.

For customers lacking robust in-house tech teams, tapping managed hosting expertise is tremendously empowering. No longer constrained by capability gaps, you can leverage world-class support to accelerate the delivery of innovation and growth initiatives relying on digital platforms.

Reduced Workload for Customers

Offloading substantial hosting management duties also pares down workloads so customers focus on core business initiatives rather than infrastructure burdens. Self-managed hosting consumes endless cycles tracking usage trends, applying patches, optimizing configurations, responding to alerts, and putting out fires.

With managed services, clients avoid the perpetual treadmill of administration tasks unrelated to their true expertise and value creation. Instead, they can dedicate those hours to developing software features, creating content, devising digital marketing campaigns, or building customer relationships.

The time savings alone may justify the premium for managed hosting, especially for smaller teams wearing many hats. Eliminating the distractions of server upkeep helps keep stakeholders laser-focused on big-picture priorities rather than technology Solutions infrastructure weeds. Partners offering fully managed hosting deserve strong consideration for the workload relief benefit alone.

By leveraging managed experts, organizations concentrate their energies on where they truly shine. They can entrust hosting to seasoned providers with proven mastery keeping sites and applications humming 24/7.

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