Backup pricing is confusing because it isn't really priced on storage alone - it's priced on data volume, retention length, and how fast you need to recover. Here's what actually drives the cost, and realistic numbers for Perth businesses.
What Actually Drives Backup Pricing
- Data volume - the raw amount of data being backed up, growing over time as your business does
- Retention period - how far back you can restore from. 30 days costs less than 7 years, which matters for compliance-driven industries
- Recovery speed (RTO) - cloud-only backup is cheaper but slower to restore; local + cloud hybrid backup costs more but restores much faster
- What's covered - servers, workstations, Microsoft 365 mailboxes and files, and any line-of-business databases all typically get priced or licensed separately
- Testing and monitoring - whether restores are periodically tested and verified, or just assumed to be working because the backup job completed
Realistic Cost Ranges
Microsoft 365 Backup
Typically $3-$8 per user per month for a dedicated third-party Microsoft 365 backup tool, covering mail, OneDrive, SharePoint, and Teams data. This is separate from your Microsoft 365 licensing - see our guide on what Microsoft 365 actually covers, and what isn't included.
Server and Workstation Backup
Cloud-only backup for a small server environment often starts around $150-$400 per month depending on data volume. Adding a local backup appliance for faster recovery (a hybrid setup) typically adds a hardware cost upfront ($1,500-$4,000+ depending on capacity) plus ongoing management.
Full Managed Backup Service
For a business wanting backup fully managed - configuration, monitoring, and regular test restores included - expect this bundled into a broader managed IT or backup-specific agreement, commonly landing in the $300-$700 per month range for a typical 10-20 person business, scaling with data volume and retention requirements.
Why the Cheapest Option Is Rarely the Right One
The lowest-cost backup option is almost always cloud-only, with no local copy and no tested restore process. This satisfies the letter of "having a backup" while leaving significant risk on the table - a full data recovery from cloud-only backup after a ransomware incident can take days for a business with a meaningful amount of data, not hours. See our guide on the 3-2-1 backup rule for why a single backup location, however reliable, isn't considered sufficient practice.
Cost of Getting It Wrong
The real comparison isn't backup cost against doing nothing - it's backup cost against the cost of extended downtime or permanent data loss. A properly configured, tested backup costing a few hundred dollars a month is inexpensive against the alternative of days of lost productivity, client data unrecoverable, and in some industries, compliance and reputational consequences on top.
What to Ask a Provider Before You Commit
- What's the actual recovery time for a full server restore, not just an individual file?
- Are test restores included and performed on a schedule, or is that an extra cost?
- Is retention long enough for any compliance obligations specific to your industry?
- Does the quote clearly separate Microsoft 365 backup, server backup, and workstation backup, or is it bundled vaguely?
Frequently Asked Questions
Is Microsoft 365's built-in retention enough, or do I need to pay for separate backup?
Microsoft 365's retention is not a substitute for a real backup - it has limited retention windows, doesn't protect against many deletion or ransomware scenarios, and Microsoft's own terms state you're responsible for your own data protection. A proper third-party Microsoft 365 backup typically adds $3-$8 per user per month on top of your existing licensing.
Why does recovery speed affect the price so much?
Because faster recovery generally means storing backup data locally as well as offsite (for a quick restore) rather than relying solely on downloading from the cloud, which takes longer for large data volumes. Local + cloud (hybrid) backup costs more than cloud-only, but can cut recovery time from days to hours for a full server restore.
What's a realistic monthly backup budget for a 15-person business?
For a typical 15-person business with a server or two and standard Microsoft 365 usage, expect somewhere in the $300-$700 per month range for a properly configured backup covering servers, workstations, and cloud data with tested restores - though this varies significantly with data volume and retention requirements.
Does backup cost include testing, or is that extra?
This varies significantly by provider, and it's worth asking directly. Some managed backup services include periodic test restores as standard; others only back up and monitor job completion, leaving testing as an additional service or your own responsibility. An untested backup is a real risk regardless of how much you're paying for it.
We configure, monitor, and regularly test-restore backups for Perth businesses - so a backup that hasn't actually been verified never becomes your problem.
Backup & DR Services →Not sure what your current backup actually costs, or covers?
Call 0433 087 091 - we'll review your current setup and give you a clear, itemised quote for what proper coverage would cost.
Get a Free Backup ReviewFor related reading, see our guides to the 3-2-1 backup rule explained and how to test your business backup.