In-house vs Outsourced Security Operations Center

Their platforms serve a global audience 24/7, their workloads are growing, and so are the regulatory demands. Frameworks like DORA now require full visibility and timely reporting of every security incident, not just reactive monitoring during office hours.

Meanwhile, cyberattacks are becoming more frequent and sophisticated. In 2023 alone, the EU recorded over 11,000 cyber incidents, while the U.S. reported 880,000 complaints, with billions lost to breaches and ransomware.

For organizations scaling rapidly and lacking automated tools and responsible security professionals, this creates a critical decision point: should they build an in-house Security Operations Center (SOC), or outsource threat detection and response to experts?

In this article, we'll:

• Compare in-house vs outsourced SOC
• Highlight the benefits and challenges of each option
• Explain when it makes sense to choose an in-house or outsourced SOC
• Help you figure out the best way to keep your company safe

Ready? Let's break it down!

What Is a Security Operations Center

A Security Operations Center (SOC) is a centralized unit that monitors and protects an organization's digital infrastructure. The SOC's primary role is to detect, analyze, and respond to cybersecurity threats in real time. It consists of a team of cybersecurity experts who use advanced tools and technologies to protect systems, networks, and sensitive data.

The team spots potential threats, investigates any security incidents, and takes action to prevent them from becoming serious problems. The SOC operates 24/7 and ensures that threats are detected early and addressed right away, whether from external hackers or internal system weaknesses.

What Is an Outsourced Security Operations Center

An Outsourced Security Operations Center (OSOC) is a service offered by third-party companies that specialize in managing cybersecurity operations. These companies are responsible for monitoring and defending the organization's digital assets. They provide businesses with a comprehensive solution to their security needs.

In this setup, the outsourced team works just like an in-house SOC, but businesses don't have to invest in building or maintaining the infrastructure themselves. Outsourced SOC providers have a team of skilled cybersecurity experts who monitor the organization's systems 24/7.

What’s more, vendors are usually responsible for providing and maintaining security tools needed to protect digital assets, which frees up companies from having all these in-house.

A managed SOC is one of the most common OSOC models, offering a fully managed external SOC team that provides ongoing monitoring and incident response.

A hybrid SOC blends internal teams with outsourced expertise. It enables organizations to maintain control over sensitive operations while benefiting from the scale and capabilities of a third-party SOC.

Benefits of an Outsourced Security Operations Center

So, what benefits can an outsourced SOC bring to your organization? We’ll explain.

You save cost

Building and maintaining an in-house SOC can be costly. Our recent article on SOC pricing concluded that the average cost to establish and maintain an internal SOC can range between $1,000,000 - $1.6 million annually for mid-sized companies and $2-$4 million annually for large enterprises. This includes the cost of staff salaries, technology infrastructure, and ongoing training. For many businesses, this is simply not feasible.

An outsourced SOC can significantly lower these costs. If companies choose to outsource SOCs, they can avoid the financial burden of hiring and training an entire team, investing in hardware, and maintaining up-to-date security tools. You pay only for the services you need, with no need for long-term capital investments. All these lead to considerable savings, especially for mid-sized and large organizations.

Your organization gets access to expert talent

Cybersecurity requires specialized knowledge, and the demand for skilled cybersecurity professionals is high. According to the 2024 ISC2 Cybersecurity Workforce Study, the global cybersecurity workforce shortage expanded to an estimated 4.8 million professionals, a 19% increase from the previous year. Hiring and retaining skilled security talent can be a slow and expensive process.

Outsourced SOC providers offer instant access to a pool of highly skilled experts who specialize in a wide range of cybersecurity fields, like threat hunting, immediate incident response, or malware analysis.

For example, at TechMagic, we employ a team of security engineers who proactively address threats. Within our SOC services, we offer clients a level of specialized expertise that would be difficult and costly to build internally.

You can respond to threats faster

Time is everything when responding to cybersecurity incidents. According to the 2024 Cost of a Data Breach Report conducted by the Ponemon Institute and IBM, the average time needed to detect and contain breaches related to theft of personal data is 292 days. The quicker a threat is detected and contained, the less damage it causes.

Outsourced SOC providers have established processes, experienced teams, and automated tools in place to identify and respond to security incidents much faster than in-house teams. The abovementioned report also concluded that organizations that integrated AI and automation in security prevention saved an average of $2.22 million over those organizations that didn’t.

With outsourced SOCs, your organization can minimize the impact of security breaches, ensure business continuity, and avoid the disruptions caused by prolonged response times.

Your security operations get more flexible and scalable

As your business grows, so do your security needs. Scaling up in-house SOC operations can involve extensive planning, recruitment, and additional technology investments. Outsourced SOC services provide the flexibility to quickly scale up or down based on your organization’s changing needs.

If your company experiences growth due to new product launches, acquisitions, or geographic expansion, an outsourced provider can adjust to accommodate increased data traffic, users, and potential threats.

For example, if your company enters a new market with heightened cyber risks, your outsourced SOC can easily deploy additional resources and monitoring to address these increased threats. This ensures that you stay protected without the need for new hires or additional infrastructure.

You get 24/7 threat monitoring

Cyber threats don’t follow business hours. An effective response requires constant vigilance, which is one of the most significant advantages of outsourcing your SOC. The Ponemon Institute and IBM’s Cost of a Data Breach Report found that companies that detected and contained data breaches within 30 days saved an average of $1 million in damages.

With an outsourced SOC, you benefit from continuous monitoring, meaning threats are detected and addressed the moment they arise, regardless of time zone. This around-the-clock coverage reduces the likelihood of attacks going unnoticed or unresolved. Outsourced providers use sophisticated monitoring tools and skilled personnel to track your systems continuously, detect vulnerabilities, and mitigate them promptly.

Your organization improves compliance management

Achieving compliance can be a challenge. Many industries like healthcare, finance, and retail have strict data protection regulations, including GDPR, HIPAA, and PCI DSS. The penalties for non-compliance can be significant. An outsourced SOC provider is well-versed in these regulations and can help ensure that organizations meet regulatory requirements.

Additionally, outsourced SOC providers often assist with security audit preparation, including ISO 27001 and SOC 2 compliance. At TechMagic, for instance, we offer expert support to ensure your organization is fully prepared for critical vulnerability assessments.

Your security benefits from advanced technologies

Outsourced SOCs have access to the latest technologies, tools, and approaches. That’s why outsourcing is a more cost-efficient option than if a company implements the required technology on its own.

For instance, many providers implement SIEM (Security Information and Event Management) systems, MDR (Managed Detection and Response), SOAR (Security Orchestration, Automation, and Response), EDR (Endpoint Detection and Response), UEBA (User and Entity Behavior Analytics), and different Artificial Intelligence (AI) tools to enhance threat detection and analytics and automate much of the processes.

Such tools and approaches help analyze vast amounts of data far faster and more accurately than traditional methods. They detect anomalies and ensure faster identification of threats while reducing the number of false positives.

Your team can focus on core business functions

Managing cybersecurity in-house can divert attention from the core operations of your business. Security requires ongoing management, monitoring, and updates – all of which can take time away from your internal teams.

With an outsourced SOC, your staff can focus on what they do best – product development, customer service, or marketing – while the outsourced team handles the day-to-day security operations. Plus, the internal security team can concentrate on higher-level tasks and strategic planning, rather than being overwhelmed by routine operations.

What Is an In-house Security Operations Center

An In-house Security Operations Center (ISOC) is an internal department within a company that focuses on monitoring, detecting, and responding to security issues. Unlike outsourced SOCs, which are managed by external vendors, an in-house SOC is fully controlled by the company itself. This approach requires a considerable investment in technology, infrastructure, and staff, but it gives businesses complete control over their security operations.

An internal SOC is typically made up of security experts who handle the full spectrum of cybersecurity tasks, such as monitoring networks, responding to incidents, and analyzing threats. While this model provides more control, it can be expensive and difficult to maintain, especially for smaller businesses with limited resources.

Advantages of an In-house Security Operations Center

But, still, what are the benefits of having an in-house security team within your organization? We’ll tell you.

You have direct control over security processes

An in-house SOC offers organizations the ability to directly manage and oversee their security processes. This control allows businesses to quickly adjust tactics, modify procedures, and make immediate decisions based on real-time data. For example, if an urgent threat arises, an internal SOC can instantly implement a response strategy without waiting for external approval or coordination.

However, this level of control comes with trade-offs – maintaining an effective internal SOC requires considerable resources, from hiring specialized staff to continually updating technology. Additionally, the need to maintain expertise and systems across a broad range of potential threats can overwhelm internal teams.

There’s a closer alignment with company culture

In-house SOCs are often seen as more aligned with a company's culture, as the team is embedded within the organization and familiar with its values, goals, and operations. This alignment can facilitate communication and ensure that cybersecurity measures are tailored to the specific needs of the business. For instance, an internal SOC can work more closely with different departments to understand operational risks and tailor its measures accordingly.

However, this alignment can also limit the diversity of thought and expertise available within the team of security analysts and engineers. The security environment is constantly changing, and keeping up with the advanced threats, latest technologies, and regulatory changes can be a full-time job.

You have immediate access to internal security data

One advantage of an internal SOC is the ability to have immediate access to internal security data. This can be particularly valuable for businesses with highly sensitive data or specific internal security needs that require quick analysis. With an internal team, there’s no need to manage delays or concerns about data security that might arise when working with third-party providers.

However, this instant access can also lead to over-reliance on internal resources and leave organizations vulnerable to data overload and missed security threats. In-house teams may become too focused on internal data and overlook emerging threats outside of their immediate purview.

Integration with company security policies is easier

In-house SOCs are inherently more integrated with company policies, as they are part of the organization. Security measures and protocols can be directly aligned with internal workflows, governance structures, and compliance standards. This makes policy enforcement smoother and ensures that security initiatives are consistently aligned with the organization’s strategic goals.

While this alignment can be beneficial, it often requires a significant amount of time and resources to continuously monitor and adjust security measures as the company grows and industry standards and regulatory requirements change.

Checklist When To Choose an Outsourced SOC

Deciding whether to outsource your SOC is a serious question that can impact your organization’s cybersecurity strategy. Our checklist below will help you assess the key considerations.

So, an outsourced SOC is the right choice for your business in the following cases:

When you need 24/7 threat monitoring without additional overhead

An outsourced SOC offers continuous, real-time threat monitoring without the staffing, training, or infrastructure costs associated with maintaining an internal team. This ensures that potential threats are quickly detected and responded to, without the operational burden.

When your organization lacks sufficient cybersecurity expertise

Outsourcing provides instant access to a team of skilled professionals without the challenges of recruitment and training. This helps fill gaps in cybersecurity knowledge, especially in a field that’s increasingly difficult to staff in-house.

When you want to reduce operational costs

Building your own SOC is costly, with expenses related to staffing, technology, and infrastructure. Outsourcing allows you to pay only for the services you need. This reduces overall security costs while maintaining robust protection.

When you require scalability to handle growing security needs

With business growth comes the expansion of cybersecurity needs. Outsourced SOCs can quickly scale to meet new demands, accommodating increased data, intellectual property, users, and geographic expansion, without the need for additional hires or system upgrades.

When you need to stay compliant with security regulations

Managed security service providers are experts in achieving regulatory compliance. They stay updated on the latest laws and implement proactive security measures to ensure your business remains aligned with these regulations.

When quick deployment and immediate response times are essential

Outsourced SOC vendors are equipped with predefined protocols and experienced teams, which enable rapid response capabilities. This reduces delays and helps minimize damage, especially when compared to the lengthy setup times for an internal team.

When you want to integrate advanced security technologies

Cybersecurity technologies and approaches for threat detection and analytics, such as SIEM, MDR, SOAR, EDR, UEBA, etc., require significant investment and expertise. Outsourced SOCs integrate these advanced platforms and tools, eliminating the need for costly investments.

When focusing internal resources on core business functions is a priority

Outsourcing your SOC allows your internal team to focus on business-critical areas like innovation and customer service, while cybersecurity experts handle the protection of your infrastructure, improving overall productivity and growth potential.

When you need to ensure continuous threat detection and management

Outsourced SOCs provide 24/7 monitoring to ensure that no threat goes unnoticed, even during off-hours. This is crucial in protecting against sophisticated cyber threats like Advanced Persistent Threats (APTs), which require constant vigilance.

When you want access to a diverse range of security experts

Outsourcing gives you access to a team with diverse cybersecurity expertise, including areas such as malware detection, network defense, and incident response. This ensures comprehensive protection across all aspects of cybersecurity. The diversity of experts also provides wide expertise across different cloud environments like AWS, Azure, and Google Cloud, as well as an understanding of various industries and specific software solutions.

When there is a lack of in-house resources to monitor security effectively

Many organizations face staffing shortages in their security analysts and engineers, which leaves them vulnerable to threats. Outsourcing allows you to extend your capabilities and ensure effective security monitoring without the need for additional hires.

When you need to rapidly adapt to emerging threats and vulnerabilities

Outsourced SOCs stay updated with the latest threat intelligence to ensure they can quickly adapt to new risks. Such a proactive approach provides a critical advantage over internal teams, who may struggle to keep up with the latest threats.

Your Security Operations Can Be Better With TechMagic

Outsourcing Security Operations Center offers numerous benefits, like cost savings, expert support, and scalability. The good news is that you can improve your security posture with TechMagic’s outsourced SOC.

Our experts provide 24/7 monitoring, rapid incident response, and proactive threat management. We adapt solutions to your business needs and ensure strong protection against cyber threats. Let TechMagic handle your security processes, so you can focus on growth. Contact us today to discuss how our SOC services can strengthen your business.

Wrapping Up

To conclude, the choice between an outsourced and internal SOC often depends on your organization's risk tolerance and capacity to manage threats by the team. Both in-house and outsourced options offer their advantages, but for most organizations, outsourcing provides a more flexible, cost-effective solution.

The SOC outsourcing option gives access to expert talent, advanced technology, and 24/7 threat monitoring – essential components for defending against modern cyber threats. Outsourcing SOC can improve your organization's defenses, allow your internal teams to focus on what they do best, and ensure your business remains secure in a world where cyberattacks happen every few seconds.

FAQs

1. What is an outsourced SOC?

   An outsourced SOC is a third-party service that manages an organization's cybersecurity, monitors critical systems, detects threats, helps achieve a robust cybersecurity posture, and responds to incidents 24/7 without the need for in-house infrastructure.

2. What is the difference between an outsourced and in-house SOC?

   An in-house SOC is managed internally with dedicated staff and resources. It ensures direct control but requires high costs. An outsourced SOC is handled by an external provider, offering such outsourced SOC pros as flexibility, cost efficiency, and access to advanced tools and talent.