The CTO made the call: they'd run their own email infrastructure. The math seemed compelling—cloud email services charged per message, and at their volume, self-hosting would save hundreds of thousands annually. Two years later, they'd spent more on the email team's salaries than they would have on managed services, and deliverability was worse than when they started.
Self-hosting email is one of those decisions that looks different from the inside than the outside. The cost savings are real but so are the hidden costs. The control is valuable but so is the expertise required to use it well.
Here's an honest comparison to help you decide.
Managed service advantages
Deliverability expertise included. Email deliverability is a specialized skill. Managed services employ teams who do nothing but maintain sender reputation, manage IP pools, handle blacklist issues, and optimize delivery. You get their expertise without hiring it.
Infrastructure is handled. Servers, scaling, redundancy, security patches, monitoring—all managed for you. You focus on your application; they focus on email infrastructure.
Immediate capability. Sign up, configure DNS, start sending. No infrastructure to build, no warmup period (on shared IPs), no learning curve for operations.
Compliance and certifications. Major providers maintain SOC 2, HIPAA, GDPR compliance. They handle the audits, documentation, and controls. You inherit their compliance posture.
Support when things break. When email stops working at 3 AM, you have someone to call. Managed services provide support that self-hosted infrastructure doesn't.
Managed service disadvantages
Cost at scale. Per-message pricing adds up. At millions of emails monthly, managed services cost significantly more than self-hosted infrastructure. The break-even point varies but exists.
Less control. You're constrained by the provider's features, limits, and policies. Custom requirements might not be possible. You can't optimize at the infrastructure level.
Vendor dependency. Switching providers requires migration effort. Your integration code, templates, and workflows are tied to their platform. Lock-in is real.
Data residency concerns. Your email content passes through their infrastructure. For sensitive data or strict compliance requirements, this might be problematic.
Shared reputation (on shared IPs). Unless you pay for dedicated IPs, your deliverability is tied to other senders. Their problems become your problems.
Self-hosted advantages
Cost efficiency at scale. Once you've built the infrastructure and team, marginal cost per email is minimal. At very high volumes, self-hosting is dramatically cheaper.
Complete control. Configure everything exactly as you need. Implement custom features. Optimize for your specific use case. No artificial limits or missing features.
Data sovereignty. Email never leaves your infrastructure. For sensitive content or strict compliance requirements, this might be necessary.
No vendor dependency. You own the infrastructure. No risk of provider policy changes, price increases, or service discontinuation affecting you.
Deep integration. Self-hosted infrastructure can integrate deeply with your systems in ways managed services can't. Custom processing, routing, and handling become possible.
Self-hosted disadvantages
Operational burden. Email infrastructure requires constant attention. Security patches, capacity planning, monitoring, incident response—it's ongoing work, not a one-time setup.
Deliverability is your problem. IP reputation, blacklist management, authentication configuration, ISP relations—you need expertise in all of it. Deliverability problems are yours to solve.
Hiring and retention. Email operations requires specialized skills. Finding, hiring, and retaining people with this expertise is challenging and expensive.
Compliance burden. You're responsible for your own compliance. Audits, documentation, controls—all on you. This is significant overhead for regulated industries.
Capital investment. Infrastructure costs money upfront. Servers, networking, redundancy, disaster recovery—the initial investment is substantial.
The hidden costs of self-hosting
The obvious costs—servers, bandwidth, software—are just the beginning.
Personnel. You need people who understand email infrastructure, deliverability, and security. At minimum, this is a significant portion of one person's time. More likely, it's multiple people. Salaries, benefits, and the opportunity cost of what else they could be doing.
Learning curve. Email infrastructure has decades of accumulated complexity. SPF, DKIM, DMARC, bounce handling, feedback loops, throttling, warmup—the learning curve is steep. Mistakes during learning hurt deliverability.
Incident response. When email breaks, you fix it. Nights, weekends, holidays—email doesn't care about your schedule. The on-call burden is real.
Opportunity cost. Time spent on email infrastructure is time not spent on your core product. For most companies, email isn't the business—it supports the business.
Decision framework
Choose managed services if:
- —Email isn't your core competency
- —You lack email infrastructure expertise
- —You value time-to-market over cost optimization
- —Your volume is under a few million emails monthly
- —You want someone else handling deliverability
Choose self-hosting if:
- —You have very high volume (tens of millions monthly)
- —You have or can hire email infrastructure expertise
- —You have strict data sovereignty requirements
- —You need capabilities managed services don't offer
- —Long-term cost optimization is critical
Hybrid approaches
The choice isn't binary. Many organizations use hybrid approaches:
Managed for sending, self-hosted for receiving. Outbound email benefits most from managed deliverability expertise. Inbound email (if you handle it) might be simpler to self-host.
Managed primary, self-hosted backup. Use managed services normally but maintain self-hosted capability for redundancy or specific use cases.
Gradual migration. Start with managed services, build self-hosted capability over time, migrate when ready. This spreads risk and learning.
Different services for different needs. Transactional email through one provider, marketing through another, internal email self-hosted. Match the solution to the requirement.
Questions to ask yourself
Before deciding, honestly assess:
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Do you have email infrastructure expertise in-house? If not, can you hire it?
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What's your actual volume? Is it enough to justify self-hosting economics?
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How critical is email to your business? Can you afford deliverability problems while learning?
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What are your compliance requirements? Do they mandate self-hosting or allow managed services?
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What's your team's capacity? Can they take on email operations without neglecting other priorities?
The right answer depends on your specific situation. Don't self-host because it seems more "serious" or use managed services because it's easier. Choose based on honest assessment of your constraints and capabilities.
Frequently asked questions
At what volume does self-hosting become cost-effective?
It varies widely based on your infrastructure costs, team costs, and managed service pricing. Rough estimates suggest somewhere between 5-20 million emails per month, but this depends heavily on your specific situation. Do the math with your actual numbers.
Can I start with managed and migrate to self-hosted later?
Yes, and this is often the smart approach. Start with managed services to learn email operations, build volume, and understand your needs. Migrate to self-hosted when you have the expertise and volume to justify it.
What about using cloud infrastructure for self-hosting?
Running your own email infrastructure on AWS, GCP, or Azure is common. You get cloud benefits (scalability, managed hardware) while controlling the email stack. But you still need email expertise—cloud providers don't manage your Postfix configuration.
How long does it take to build self-hosted email infrastructure?
Basic sending capability can be set up in days. Production-ready infrastructure with proper redundancy, monitoring, and deliverability optimization takes months. Building the expertise to operate it well takes longer.