Building a SOC vs Outsourcing a SOC: Strategic Trade-Offs

Every security leader recognises that a Security Operations Center (SOC) is central to detecting, investigating and responding to cyber threats. However, once the decision is made to invest in a SOC capability, organisations face an equally consequential strategic choice: build and operate a SOC in-house, or outsource it to a specialist provider?

This decision shapes your total cost of ownership (TCO), risk exposure, compliance posture, operational agility, and long-term scalability.

SOC in a Modern Risk Context

A SOC ingests telemetry from across your network, cloud and endpoints; analysts correlate and triage alerts; and incident response teams contain and mitigate attacks. The overarching goal remains unchanged whether in-house or outsourced: detect threats early and respond effectively.

But the model you choose affects how you achieve that goal, when you achieve it, and at what cost and risk.

In-House SOC: Deep Control with High Fixed Costs

An in-house SOC is staffed, managed and operated entirely within your organisation. It gives you maximum control over security policy, monitoring thresholds, escalation workflows and compliance evidence.

Financial Reality: People Drive the Numbers

Industry estimates show that running an internal SOC with 24×7 coverage comes with significant costs:

• Personnel are the largest cost driver. A fully staffed 24×7 SOC typically requires at least 8–12 analysts, engineers and managers to cover shifts effectively. Recruiting and retaining that talent is expensive in tight cybersecurity labour markets. 

• Independent SOC cost models estimate that security engineers and analysts alone can cost more than $600,000 per year, and when combined with tooling, infrastructure and 24×7 staffing the total annual cost can exceed $1.6 million. 

Beyond salaries, internal SOCs must invest in:

• SIEM, EDR/XDR and threat intelligence tooling

• Infrastructure and data storage

• Continuous training and certification

• Shift scheduling and administrative overhead

Collectively, these items create significant fixed costs that persist regardless of threat volume.

Time and Maturity

Building an internal SOC is also a time-intensive project. Organisations often take 6–18 months to recruit staff, deploy tooling and tune operational processes before achieving effective 24×7 coverage. 

Strengths and Limitations

Strengths

• Maximum control over data and policies

• Tailored detection rules and business context

• Close alignment with sensitive data governance

Limitations

• High fixed costs and budget volatility

• Talent scarcity and retention challenges

• Long time to value

• Scalability tied to headcount growth

Outsourced SOC: Variable Costs, Rapid Operation

An outsourced SOC (often delivered as SOC-as-a-Service or via MDR) shifts much of the burden of operations, tooling and staffing to a third-party provider.

Pricing Reality: Predictable OpEx

Outsourced SOC services are typically priced on a subscription or per-asset basis. For example:

• Managed SOC pricing often ranges from about $10 to $20 per asset per month, depending on service scope and requirements. 

• Some market data points to $25–$50 per monitored device per month as a common range for comprehensive SOC-as-a-Service pricing. 

These models translate into predictable operational costs such as:

• 500 assets × $15 per asset per month = $90,000 annually

• 1,000 assets × $20 per asset per month = $240,000 annually

This contrasts sharply with internal SOC models that can exceed $1.5 million per year before factoring hidden costs. 

What Outsourced SOC Includes

Outsourced SOC pricing typically covers:

• 24×7 monitoring and alert triage

• Threat investigation and reporting

• Tooling and infrastructure licences

• Access to specialised analysts and threat intelligence

• Compliance artefacts and reporting

The result is a variable OpEx model with costs that scale with your environment and threat landscape rather than headcount.

Strengths and Limitations

Strengths

• Lower and more predictable cost base

• Rapid time to value (often weeks, not months)

• Access to collective threat intelligence and specialist expertise

• Easier scalability

Limitations

• Less direct control over operations

• Dependency on provider SLAs and performance

• Potential vendor lock-in risk

• Need for strong governance and contractual clarity

Hybrid Models: Strategic Middle Ground

Many organisations adopt a hybrid or co-managed SOC model that blends internal control with outsourced capacity:

• Internal team retains governance, threat hunting and high-context investigations

• Provider handles 24×7 monitoring and Tier-1 alert triage

This combination allows leadership to balance control, cost and operational scale without fully committing to either pure in-house or pure outsourced operations. 

Cost, Risk and Compliance Trade-Offs

Total Cost of Ownership (TCO)