Breaking Down Managed Detection and Response Pricing and ROI

In the face of rising threat complexity, mounting compliance pressures, and shrinking IT resources, one question keeps resurfacing for enterprise security leaders: Are we equipped to defend what we still rely on?

For many organizations, the answer is layered in legacy.

Despite growing interest in cloud modernization, a large share of mission-critical workloads still run on-premises. According to Flexera’s 2024 State of the Cloud Report, 50% of enterprises continue to operate hybrid environments, with core ERP, financial, or industrial control systems remaining on legacy infrastructure due to regulatory, technical, or budget constraints. And that’s perfectly valid.

But here’s the challenge: Security threats don’t wait for cloud migration timelines. Whether your workloads are in a Tier 3 data center or partially lifted into the cloud, they’re still prime targets. Ransomware, supply chain attacks, AI-driven phishing, and zero-day exploits now strike indiscriminately, exploiting outdated protocols, unsupported systems, and monitoring blind spots at unprecedented speed.

The traditional response of building an in-house security operations center (SOC), investing in multiple point solutions, and staffing for 24/7 coverage is no longer financially sustainable for most organizations. The global cybersecurity talent gap alone exceeds 3.4 million professionals, making around-the-clock threat detection and response a tall order even for well-funded teams.

That’s where Managed Detection and Response (MDR) changes the equation.

MDR is an economic shift that offers a scalable, intelligence-driven alternative to the sprawling costs and resource constraints of building security operations in-house. By outsourcing the burden of threat detection, investigation, and containment, organizations gain access to elite tools and talent without the overhead, and without needing to uproot their entire environment.

In this article, we’ll break down the real total cost of ownership (TCO) behind modern security operations, compare in-house models with MDR economics, and explore how MDR helps organizations of all sizes modernize their security posture without overspending or overcommitting to cloud migration.

Why Security Complexity Has Outpaced In-House Models

The threat landscape facing today’s IT and security teams is borderless, dynamic, and accelerating faster than most organizations can staff or scale. The traditional model of building and maintaining an in-house SOC simply isn’t designed for the velocity, volume, and sophistication of modern cyberattacks.

Consider this: over 400,000 new malware variants are detected every day. Meanwhile, attackers are now leveraging AI to automate reconnaissance, phishing, and even exploit creation, reducing the time between vulnerability disclosure and attack from weeks to mere hours.

At the same time, ransomware groups have evolved into organized, service-based enterprises. In 2023, 66% of organizations worldwide reported ransomware attacks, with 61% of those impacting data integrity or availability.

Even for organizations that invest heavily in tooling, talent remains the limiting factor. The cybersecurity workforce gap has grown, with 70% of security teams reporting that staff shortages are directly affecting their ability to respond to incidents. And those who are in the role? They’re burning out.

Let’s do the math: hiring 5 full-time security analysts to cover 24/7 detection and response (3 shifts plus redundancy) can cost upwards of $700,000 annually, and that’s before licensing tools like SIEM, SOAR, EDR/XDR, or vulnerability scanners. Add training, turnover, and tool integration, and you’re looking at a multi-million dollar effort with limited economies of scale.

And despite these investments, most internal SOCs still struggle with:

• Incomplete visibility across hybrid environments
• Delayed response times due to manual triage
• Overreliance on alerts without context or correlation
• Gaps in endpoint detection across legacy and unmanaged devices

In short: the old model doesn’t scale. But attackers do.

This is the inflection point.

What is MDR and Why it Works for Hybrid & Legacy Environments

For organizations stretched thin by increasing cyber threats and dwindling internal resources, Managed Detection and Response has emerged as a powerful alternative to traditional in-house security operations. But despite its rising popularity, MDR is often misunderstood, especially by teams with deeply entrenched, mission-critical systems still running on-prem.

So let’s clear the air: MDR isn’t a black-box outsourced SOC. It’s not just alerting, and it’s not “outsourcing security” in the way many IT leaders fear.

At its core, MDR is a turnkey, always-on security service that delivers 24/7 detection, investigation, and response, executed by highly skilled security analysts using advanced EDR/XDR platforms, real-time threat intelligence, and automation. But the real power of MDR lies in its adaptability. It doesn’t require a full cloud migration to be effective. In fact, many of the most successful MDR implementations are in hybrid or even predominantly on-prem environments, precisely because of the visibility and expertise gaps it fills.

For example, many MDR providers bundle tools like endpoint detection and response (EDR), managed SIEM, and threat hunting services into their core offering. These capabilities aren’t limited to public cloud VMs, they extend to on-prem file servers, legacy applications, and even industrial control systems, depending on the provider’s coverage model.

This model turns what used to be a massive capital investment into a predictable operating expense, with built-in scalability and service-level guarantees. Instead of buying a SIEM license, staffing 3 shifts, and writing your own playbooks, you gain access to a full-stack security capability that’s ready on day one—and constantly evolving.

Security ROI: How MDR Strengthens Posture and Reduces Risk

The average cyberattack now moves with machine-like precision. According to IBM’s Cost of a Data Breach Report, organizations with fully deployed security AI and automation experienced a 108-day shorter breach lifecycle and saved an average of $1.76 million per incident compared to those without it.

Unlike traditional MSSPs or alert-only platforms, MDR providers offer full-spectrum security operations, meaning they don’t just detect threats, they investigate and respond to them. In practice, this can reduce mean time to respond from hours (or days) to minutes. And when your infrastructure includes vulnerable or unsupported systems, that speed makes the difference between a contained incident and a full-blown breach.

One of the most overlooked benefits of MDR is its ability to provide unified visibility across hybrid environments. With integrated telemetry from on-prem servers, cloud workloads, SaaS tools, and endpoints, MDR platforms eliminate the silos that often hinder in-house teams.

This visibility is paired with real-time threat intelligence, often sourced from thousands of global clients, which gives MDR providers a broader and more timely view of active threat patterns. Your business gains access to this intelligence without needing to maintain a dedicated threat research team in-house.

And because many MDR providers operate agent-based or API-integrated models, they can easily support older systems that still matter, from Windows Server 2012 to proprietary industry applications. That’s a huge advantage for organizations still reliant on niche or legacy tools that aren’t easily replaced.

Real-World Security, Real-World Savings

When it comes to managed detection and response pricing, it’s easy to fixate on monthly fees. But the real value of MDR is measured in risk reduction, incident prevention, and staff efficiency.

By offloading 24/7 detection and response to a trusted partner, organizations often save:

• Hundreds of staff hours per month in alert triage
• Six- to seven-figure expenses on breach recovery
• Tens of thousands on tooling consolidation

Moreover, MDR pricing models are typically flat-rate and scalable—charging per protected endpoint, user, or workload—making them predictable and easy to budget. Compare that to the unpredictable costs of SIEM overages, analyst turnover, and surprise consulting hours, and the economic argument becomes clear.

In fact, research by Forrester has shown that organizations using MDR can realize a 201% ROI over three years, with payback in less than six months.

Breaking Down MDR’s Total Cost of Ownership

As IT and security leaders weigh options for protecting hybrid environments, legacy infrastructure, and high-risk endpoints, one question often stands out: What does Managed Detection and Response actually cost—and is it worth it?

Let’s be clear: Managed Detection and Response pricing is about understanding the total cost of ownership across technology, talent, time, and risk. And when you look at the full equation, MDR is affordable and strategic.

A modern MDR offering includes much more than log aggregation or automated alerts. When you subscribe to a comprehensive service, your monthly MDR pricing typically covers:

• EDR or XDR platform access
• 24/7 monitoring and analysis by certified security analysts
• Real-time detection, triage, and threat hunting
• Guided or automated incident response and remediation
• Threat intelligence feeds, updated daily (or hourly)
• SIEM/SOAR integrations, where applicable
• Monthly vulnerability scans and reporting
• Compliance support (e.g., for HIPAA, PCI DSS, SOX)
• Dedicated client portal and dashboards

You’re investing in a flat monthly fee per protected endpoint, user, or system. That means:

• No unexpected tool renewal costs
• No hourly incident response bills
• No overtime for night-shift coverage
• No post-breach cleanup chaos

TCO Comparison: In-House SOC vs. MDR

Let’s take a hypothetical example of a mid-sized enterprise managing ~2,500 endpoints, hybrid cloud/on-prem infrastructure, and a small internal IT team.

Source estimates based on Payscale and Gartner market data.

Even accounting for higher-end MDR providers or bundled services, most organizations save 40–70% compared to running their own 24/7 operations, without sacrificing visibility or speed.

Why It Matters for Hybrid and Legacy Environments

For organizations still managing mission-critical workloads on-prem, MDR pricing represents more than just cost containment. It’s a path to securing those systems with minimal internal lift, allowing your team to focus on IT modernization without leaving security gaps behind.

And because leading MDR pricing is modular, you can start small. Securing the highest-risk assets first and expanding as your environment evolves. This granular control over scope and spend is a game-changer for CIOs and CISOs seeking flexibility without compromise.

In short, managed detection and response pricing reflects a value proposition built on scale, expertise, and outcomes; not just tools.

Modernizing Legacy Security with MDR: Yes, You Can

Security modernization requires better visibility, faster response, and smarter investment decisions, all of which are possible with Managed Detection and Response.

Through a combination of agent-based EDR, network telemetry, API integrations, and custom log forwarding, MDR providers can ingest threat data from legacy systems.

This means your on-prem database servers, outdated domain controllers, or legacy ERP systems can still benefit from:

• Continuous monitoring
• Behavioral anomaly detection
• Real-time incident response
• Monthly vulnerability assessments
• Correlation with global threat intelligence

Many legacy environments remain vulnerable because the internal team simply doesn’t have the bandwidth, or specialized skills, to harden them properly. MDR fills that gap with concierge-level support, guiding your organization toward incremental improvements without disruption.

For example:

• Deploying endpoint agents on legacy servers to detect unusual access attempts
• Integrating firewall logs and VPN activity into a unified detection framework
• Flagging shadow IT activity or dormant accounts tied to older systems
• Providing monthly remediation recommendations tailored to outdated platforms

Through predictable managed detection and response pricing, you gain the benefits of enterprise-grade protection without overspending or overcommitting.