Deciding between an in-house IT team and a managed services provider is one of the most consequential technology decisions a growing business makes. Get it wrong and you either overpay for coverage you don't need — or find yourself exposed the moment something breaks at 9pm on a Friday.
Here is what the comparison actually looks like across costs, coverage, and capability, so you can make a clear decision.
What you are really comparing
The in-house vs MSP question is not just about budget. It is about what level of IT capability your business actually needs, how consistent that need is, and whether the risk of a single point of failure — one person on leave, one resignation — is something you can absorb.
In-house IT means hiring one or more IT staff directly. You own the relationship, but you also own the cost, the gaps in expertise, and the after-hours coverage problem. An MSP provides a team of specialists on a contracted basis, typically covering monitoring, helpdesk, project work, and vendor management under a fixed monthly fee.
In-house IT vs MSP: side by side
The differences go well beyond the headline cost figure. Here is how the two models compare across the areas that matter most.
| Factor | In-House IT | Managed MSP |
|---|---|---|
| Annual cost (30 staff) | $110,000–$130,000+ per person | $40,000–$60,000 (full team coverage) |
| Coverage hours | Business hours only (unless you pay extra) | 24/7 monitoring; defined after-hours SLAs |
| Depth of expertise | One generalist; specialist gaps | Team across helpdesk, security, cloud, vCIO |
| Single point of failure | Yes — leave, illness, or resignation stops cover | No — team coverage continues regardless |
| Cybersecurity | Rarely covered at depth by one hire | Included: Essential Eight, EDR, incident response |
| Compliance frameworks | Requires additional specialist hire | Covered: ACSC Essential Eight, APRA CPS 230 |
| Scalability | Requires rehiring as business grows | Scales with user count, no recruiting lag |
| Contract flexibility | Employment law; notice periods apply | Month-to-month (with the right provider) |
The real cost of in-house IT
A mid-level IT support person in Australia costs between $70,000 and $95,000 per year in salary alone. Add superannuation, leave entitlements, training, and tooling — the real cost sits closer to $110,000 to $130,000 per head annually.
That one person typically covers:
- Helpdesk for day-to-day issues
- Basic infrastructure management
- Vendor liaison for internet, phones, and software
What they usually do not cover without additional specialist hires:
- Cybersecurity architecture and monitoring
- Cloud infrastructure at scale
- Compliance frameworks such as the ACSC Essential Eight or APRA CPS 230
- 24/7 coverage across time zones or out of hours
The moment your in-house person is on leave, sick, or resigns, that coverage disappears entirely. For many businesses, that gap represents a material business risk.
What an MSP covers — and what it costs
A managed IT services provider gives you access to a team rather than an individual. Depending on the provider and scope, that team includes helpdesk engineers, infrastructure specialists, cybersecurity analysts, and a virtual CIO function.
For a business of 20 to 100 users in Australia, an MSP engagement typically runs between $80 and $160 per user per month. That covers:
- Proactive monitoring and patch management Continuous oversight of your environment, with updates applied on a schedule — not reactively after something breaks.
- Helpdesk with defined response times Guaranteed SLAs, not best-effort. All IT responds to chat in under 3 minutes and email in under 14 minutes.
- Vendor management One point of contact across software, internet, hardware, and phones — no finger-pointing between suppliers.
- Cybersecurity tooling and incident response Endpoint protection, Essential Eight uplift, and a team that knows what to do when something goes wrong.
- Strategic IT planning and budgeting A roadmap aligned to where your business is heading, not just keeping the lights on.
An MSP does not go on leave. If your account manager is unavailable, another engineer picks up the work. There is no single point of failure.
When in-house IT makes sense
In-house IT is the right call when:
- Your business has highly specialised systems that require dedicated, embedded staff
- You operate at a scale where a full IT department is cost-effective (typically 200+ employees)
- Your regulatory environment requires on-site staff with specific clearances
- You need IT staff embedded in physical operations around the clock
For most Australian SMBs and mid-market businesses, this threshold is rarely met. A single IT hire rarely covers the full range of needs — and the cost of plugging the gaps with contractors or specialists typically exceeds what an MSP would charge.
How All IT handles this
All IT manages IT for businesses across financial services, hospitality, and not-for-profit sectors. Most clients move to a managed model after running into the same problem: their in-house person left, got sick, or was simply stretched too thin.
Our average client has stayed for over 10 years. We operate on month-to-month contracts with no lock-in, respond to chat queries in under 3 minutes and email in under 14 minutes — the kind of responsiveness that a single in-house hire rarely sustains consistently.
If you are weighing up in-house IT versus an MSP and want a straight answer based on your actual setup, get in touch with the All IT team — no sales process, just a direct conversation about what makes sense.
Frequently Asked Questions
Is it cheaper to hire an IT person or use an MSP?
For most Australian businesses under 100 staff, an MSP works out cheaper when you account for full employment costs, leave coverage, training, and the tooling an in-house person needs to do the job properly. A single IT hire in Australia costs $110,000 to $130,000 per year all-in. An MSP for a 30-person business typically runs $40,000 to $60,000 annually — covering a broader set of capabilities.
What happens when my MSP is unavailable?
A reputable MSP is structured so that no single engineer is the only person who knows your environment. Account documentation, ticketing history, and monitoring data are shared across the team, so cover is always available. This is one of the core advantages over a single in-house hire.
Can I use an MSP alongside my existing IT staff?
Yes. Many businesses run a co-managed model: an internal IT person handles day-to-day requests and vendor relationships, while the MSP provides after-hours cover, specialised project work, and cybersecurity. This is common in businesses that have grown beyond what one internal hire can manage but want to retain an embedded IT presence.
At what size does in-house IT start to make more sense than an MSP?
Generally above 200 employees, where a full IT department becomes cost-effective and the volume of internal requests justifies dedicated headcount. Below that threshold, the breadth of skills required — helpdesk, infrastructure, cybersecurity, compliance, cloud — is difficult for a small in-house team to cover without gaps.
How do I know if my current IT setup is leaving me exposed?
Ask yourself: what happens to IT coverage when your in-house person is unavailable? If the honest answer is "it stops," that is a gap worth addressing. Other signals include recurring issues that never fully resolve, unclear security posture, or IT decisions being made reactively rather than as part of a roadmap.
All IT Services is a Sydney-based managed IT provider supporting businesses across financial services, hospitality, and not-for-profit sectors — on month-to-month terms with no lock-in.