3 Key Differences Between SaaS And MSPs (Managed Service Providers)

Why understanding the differences between SaaS and MSPs is essential? A guide to making an informed decision

With the advent of the cloud and continuously evolving business technologies, it becomes confusing to understand different business models. This confusion is apparent in the realm of differences between SaaS and MSP. An MSP model may have similar goals as the SaaS model; however, a more profound insight shows that both models are different.

This article highlights the differences between SaaS and managed service providers.


  • Managed service providers offer a wide range of services, including remote monitoring of servers, mobile device networks, managed security services, etc. These services are the foundation of MSPs. For instance, managed security services are helpful for enterprises that need assistance in securing their network infrastructure. MSPs provide help by partnering with third-party that specialize in cybersecurity. In addition, managed service providers use their expertise to protect business data and client information.

Conversely, hosted applications and software on demand are the only two standard service models offered by SaaS. Hosted application model providers host a business’s software and deliver it to authorized users. On the other hand, in the software-on-demand model, customer access to an individual software copy is provided by SaaS providers. This software is mainly designed for the SaaS distribution process. The source code of the software remains the same for each user. However, new functionalities and features are rolled out to all users.


  • Managed service providers offer various security benefits to organizations. These benefits include the generation of reports to keep an organization updated about the status of its system and constant remote monitoring. In addition, remote IT-managed services provide compliance assistance, correlation analysis, and risk assessment.

However, since data is stored in the cloud, SaaS users do not have complete control over their data. But SaaS users can access the services through any device with an active internet connection. Moreover, SaaS charges users only for the features they use rather than the upfront cost of an entire service.


  • Since managed service providers offer far greater capabilities and solutions, managed IT services are more expensive. In addition, MSPs frequently monitor, maintain, and upgrade the software to ensure smooth workflow and business continuity.

Pricing Models Of MSP

Managed service providers provide different billing options such as tiering, per-user, per-device, and monitoring only.

  • A monthly fee per device is charged in per-user pricing models. This is a simple pricing model that decreases the guesswork. Furthermore, IT support is covered on all users’ devices.
  • Customers are billed for remediation tasks identified through monitoring; managed service providers only monitor the network and alert the customers.
  • The tiered pricing model of MSPs is the most common. This is the best option for organizations that prefer flexibility in selecting the number of services.

Pricing Models Of SaaS Solution

differences between saas and mspsSaaS solutions offer pricing models: flat fee, tiered, usage-based, and pay-per-user.

  • Per user per month is the simplest pricing model of SaaS. A monthly fee is charged for multiple products and multiple sets of features. SaaS vendors offer a single price similar to traditional software licensing models.
  • Tiered pricing is another popular pricing model. The tiered pricing model allows multiple package offers with different combinations. Varying prices are charged for each package.
  • Another go-to SaaS pricing option is per user price model. It is known for its simplicity. In this model, a single user spends an annual flat rate. The cost doubles when another user is added, and so on.

Henson Group is an award-winning Microsoft Certified Azure Expert Managed Service Provider and offers consulting, migrations, and optimization services for Microsoft Azure. We have developed specialized skill sets for managing cloud services for businesses. For more information about our managed cloud services, visit hensongroup.com today. Get in touch today to know about us and ask us anything!