That's definitely true, although I'd still be worried about system problems further up the chain. (Load balancers, firewalls, etc). Hopefully even with managed

That's definitely true, although I'd still be worried about system problems further up the chain. (Load balancers, firewalls, etc). Hopefully even with managed hosting you're still not at the mercy of any one hardware/software failure. Part of it just boils down to risk tolerance I think, and how comfy you are with sysadmin skills. I'm responsible a medium sized (< 10 servers) web site that use managed hosting for. Their advice/service is invaluable to me, partially because I trust them enough that I can just hire web programmers without worrying about their advanced linux/networking skills being super high. The host has also helped us debug some fairly deep problems that we don't have a chance at in-house like hypervisor config issues, and even a processor 'errata', AKA processor hardware bug. It's also nice to have an ops team to ping questions off of, since we're not nearly large enough to hire a dedicated sysadmin otherwise (and they'd be without sysadmin work 50% of the time anyway). NB: I'm treating 'sysadmin' like it's just one skill set to administer routers and server hardware, configure firewalls and networking, optimize database boxes, etc. This is probably not totally true, but fits for purposes of discussion. YMMV.