MSP Pricing Models: Per-User vs Per-Device vs Block Hours
Almost every managed IT quote in Canada uses one of three billing models. Each one changes what your provider is motivated to do, what your invoice looks like, and where the surprise costs hide. Here is how they actually work.
If you are collecting quotes from managed service providers, you will quickly notice the numbers are hard to compare. One provider quotes $140 per user per month. Another quotes $65 per device. A third offers a 40-hour block at $110 an hour. All three could end up costing roughly the same over a year, or one could cost double the others, depending on how your business is set up.
This guide explains all three models with realistic Canadian dollar figures, who each model fits, what "unlimited support" really covers, and the contract terms that catch buyers out. If you are new to managed services generally, start with what an MSP is first, then come back.
How each model works.
Per-user
One flat monthly fee for each person on your team, covering all of their devices and accounts. In BC, fully managed service typically runs $100 to $250 per user per month depending on the security stack and support scope.
A 20-person company at $150 per user pays $3,000 a month, and that number only moves when headcount does.
Per-device
A monthly fee for each endpoint the provider manages, priced by type. Workstations and laptops carry one rate, servers a much higher one, and network gear and mobile devices land somewhere in between.
The same 20-person company with 25 workstations, 2 servers, and a firewall might pay a similar total, but every new device changes the bill.
Block hours
You prepay a bank of hours at the provider's hourly rate and draw it down as issues come up. Rates in northern BC typically look like ours: $95 per hour standard, $143 per hour emergency.
No monthly commitment, but no monitoring, patching, or prevention either. You pay to fix things after they break.
Pros, cons, and who each fits.
Per-user
Pros: the most predictable budget line of the three. It covers the person, not the hardware, so a laptop plus a phone plus a home machine used for work is all one fee. It also puts the provider's incentive in the right place: they earn the same whether you call once a month or once an hour, so they make money by preventing problems, not billing for them.
Cons: it costs more per month than break-fix, and it can overcharge you if a large share of your staff barely touch a computer. A 40-person operation where 25 people are in the field without laptops should not pay 40 full user fees, and a fair provider will define a reduced rate or a "light user" category for them.
Fits: office-centric teams of roughly 5 to 200 people where nearly everyone uses email, files, and a computer daily. That is most professional services, healthcare admin, non-profits, and the office side of industrial businesses.
Per-device
Pros: maps well to environments where devices outnumber people. A sawmill with shared control-room terminals, a shop floor with three kiosks used by twelve staff, or a clinic with shared exam-room machines can be cheaper per-device than per-user.
Cons: the invoice gets noisy. Every new laptop, replaced server, or added access point becomes a line item and a conversation. It also under-covers the modern reality that most support issues are about accounts, email, and cloud apps rather than a specific box. Whose "device" is a Microsoft 365 mailbox?
Fits: device-heavy, people-light environments, and some co-managed arrangements where an internal IT person handles users and the MSP handles infrastructure.
Block hours
Pros: the lowest commitment. You buy help when you need it, and a prepaid block usually gets a better rate than one-off hourly calls. For a 5-person business with simple needs and low downtime cost, it can be rational.
Cons: it is reactive by design. Nobody is patching, monitoring, or testing your backups between calls, because nobody is being paid to. The provider earns more when you have more problems, which is the wrong incentive. Costs are also unpredictable: a quiet quarter costs almost nothing, then one ransomware incident or server failure burns the whole bank in a week at emergency rates.
Fits: very small teams, businesses with an internal IT person who just needs overflow help, or organisations buying project work rather than ongoing support.
What "unlimited support" actually means.
Most per-user plans advertise unlimited support. Read that as: unlimited support for covered issues, on covered systems, during covered hours. The word "unlimited" is doing less work than it appears to. Common exclusions, in ours and everyone else's agreements:
- Projects. Fixing your email is support. Migrating your email to Microsoft 365 is a project, quoted and billed separately. Same for office moves, new server builds, and new site rollouts.
- New equipment setup at scale. Setting up one replacement laptop is usually included. Deploying fifteen new laptops is a project.
- After-hours and emergency work. Many plans cover business hours only, with evenings and weekends billed at emergency rates unless you bought a 24/7 tier.
- Undocumented or personal systems. The agreement covers the environment listed in it. The owner's kid's gaming PC and the legacy application nobody disclosed at onboarding are not on that list.
- Third-party costs. Licences, hardware, and vendor fees are passed through on top of the management fee.
None of this is a scam, it is how the model stays viable. The problem is only when a provider will not put the exclusions in writing. Ask for the list before you sign, not after your first surprise invoice.
Contract terms that catch buyers out.
- Onboarding fees. Most MSPs, including us, charge a one-time onboarding fee to document your environment, deploy tooling, and fix the highest-risk problems found on day one. It is legitimate work, but a quote that hides it makes the monthly number look better than it is. Ask for it up front and include it in your comparison.
- Out-of-scope hourly rates. The rate you will pay for projects and excluded work matters as much as the monthly fee. A cheap plan with a $200 per hour project rate can cost more over a year than a fuller plan at $95 per hour for extras.
- True-ups. Per-user and per-device counts get reconciled periodically. Watch for agreements that true-up upward monthly but only reduce your count at renewal, so you keep paying for the three staff who left in February until next January.
- Auto-renewal. Multi-year terms that renew automatically unless you cancel 60 or 90 days before the end date are common. Diarise the notice window the day you sign, and prefer providers confident enough to offer shorter terms.
- Exit and offboarding. Check who owns your documentation and passwords, and what offboarding costs. A provider that makes leaving painful is telling you something about how they retain clients.
For a full breakdown of what these numbers add up to across a year, see our guides to managed IT costs in Canada and MSP pricing in BC for 2026.
Why North Star charges per-user.
We price per-user per-month across three tiers, and we publish the numbers on our pricing page rather than making you sit through a sales call to see them. We chose per-user for a plain reason: it is the only model where our incentive and yours point the same way. If your systems break constantly, we lose money. So we patch, monitor, test backups, and fix root causes, because prevention is cheaper for us than firefighting. Under block hours, your bad month is the provider's good month. We did not want to run a business that profits from client pain.
It also matches how northern BC businesses actually operate. Your bookkeeper has a desktop, a laptop, and a phone. Billing her as three devices makes no sense. Billing her as one person does.
To compare quotes apples-to-apples, do this for every quote you receive: multiply the monthly fee by 12, add the onboarding fee, then add an honest estimate of out-of-scope work at the quoted hourly rate (most SMBs should assume at least one project a year). Then list what each quote includes: EDR or MDR, image-based backup with tested restores, after-hours coverage, on-site visits, and strategic planning time. The cheapest monthly number is frequently the most expensive first year.
Quick answers.
Which MSP pricing model is cheapest?
Block hours has the lowest monthly commitment, but it is usually the most expensive per problem because nothing is done preventively. Per-device can be cheaper than per-user for teams with few devices per person. Per-user usually costs the least over a year for a typical office because prevention reduces the number of billable problems to zero at the invoice level.
What is a typical per-user price for managed IT in Canada?
In BC, fully managed IT typically runs $100 to $250 per user per month depending on the security stack, compliance needs, and whether on-site support is included. Prices in Alberta and the rest of Canada fall in a similar range. Quotes far below $100 usually exclude security tooling or cap support.
What happens when block hours run out?
You either buy another block or pay the provider's standard hourly rate, often at a premium, until you do. Some agreements pause support entirely until the new block is purchased. Unused hours frequently expire, so check whether your bank rolls over.
Is per-device pricing dead?
No, but it has become a niche model. It still fits environments where devices outnumber people, like shops with shared workstations, kiosks, or industrial sites. For office teams where each person has a laptop, a phone, and cloud accounts, per-user pricing maps to reality better, which is why most Canadian MSPs have moved to it.
How do I compare MSP quotes fairly?
Convert every quote to a total first-year cost: monthly fee times 12, plus onboarding, plus a realistic estimate of out-of-scope work at the provider's hourly rate. Then compare what is actually included: EDR or MDR, backup with tested restores, on-site visits, after-hours coverage, and vCIO time. Two quotes with the same monthly number can differ by thousands per year once exclusions are priced in.
Does unlimited support really mean unlimited?
Unlimited almost always means unlimited support for covered issues on covered systems during covered hours. Projects, new equipment setup, after-hours emergencies, and anything outside the documented environment are typically billed separately. Ask for the exclusions list in writing before you sign.
Want a quote you can actually compare?
Book a free 30-minute scoping call with a North Star engineer. We will price your environment against our published per-user rates and show you exactly what is in and out of scope, in writing.
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