The sophistication of cyber threats is rapidly increasing, causing disastrous consequences for enterprises worldwide. According to a Microsoft Digital Defense Report, cybercriminal groups are evolving their techniques, adjusting the types of previously successful attacks, as well as creating new ways of executing malicious activities. To counter these threats, organizations need effective solutions implemented in their security operations centers (SOCs) that will help them reduce alert fatigue, as well as improve MTTD and MTTR. These centers usually work around the clock, ensuring cybersecurity defense regardless of the business hours. Even a slight delay in logging data or improper parsing can potentially result in significant losses so companies need to ensure the smooth operation of their SOCs in the first place. To do that, they have to make a strategic choice of whether to stick with an in-house solution or employ the services of a third party and establish an outsourced SOC.

Let’s review some pros and cons of launching an in-house SOC vs outsourced SOC. Also, there is a third option if you consider combining the features of both, and that is building a hybrid model.

Outsourced SOC

Managing SOC means dealing with the constant flow of data and regularly customizing solutions to meet the challenges of an ever-growing threat landscape. Consequently, quite often in-house teams have limited time and a lack of human resources to deal with an overwhelming volume of alerts they need to analyze on a daily basis. Outsourced SOC teams have more available professionals and can cover the gaps of the in-house operation, whether it’s about short-term goals (like storage cost reduction, detection content tuning, etc.), tactical (building a log source roadmap), or strategic goals (process transformation, evolution roadmap).

Pros:

• Lower transparent costs. Since outsourced SOC relies solely on operational expenses (OpEx), it is easier to track the budget spent and assess the efficiency of the solution. 
• Easy transition. If the outsourcing provider does not meet the needs of an organization, it is easier to switch to another, more effective third-party vendor. Conversely, if the organization managed to build an entire in-house SOC and then realized that MTTD and MTTR are below expectations along with other important metrics, the transition to a more viable solution could be much harder to organize.
• A team of highly qualified professionals. Typically, SOC outsourcing teams consist of highly skilled specialists that have extensive experience in the field. They are capable of building the cybersecurity posture from the ground up quickly while maintaining its efficiency 24/7/365. They also deliver a number of essential services, such as SIEM cleanup, log source filtering, performance optimization, architecture sizing, technology augmentation, and more.

Cons:

• No custom solutions. An outsourced SOC requires businesses to choose from a set of options that the service provider offers. Typically, those are close to one-size-fits-all solutions which don’t consider the specific needs of a particular industry.
• The possibility of data leakage. The confidentiality of data is always questioned when all cybersecurity monitoring and playbooks are being handed to a third party. If the organization wants to keep things like classified info under their control, they are much more reluctant to choose an outsourced SOC.

In-House SOC

This type of solution implies more control over the company’s security but also it comes with more liability. Maintaining all the needed hardware, software, and talent, companies are committed to spending significant capital expenditures (CapEx), meanwhile having to perform all the work on their own. Moreover, expenses don’t stop at this point because the in-house SOC consumes additional OpEx for its maintenance every consecutive year. 

Yet, many large organizations are ready for investing in their own SOC as long as they keep everything under their control and leverage a highly customizable framework. Usually, such businesses have a very mature SIEM deployment with multiple integrations and own DS algorithms along with advanced threat hunting.

Pros:

• Network familiarity. A dedicated SOC team possesses a strong reactivity which is valuable when facing modern cybersecurity threats. Engineers and executives are familiar with the company’s ecosystem and its challenges. Because a dedicated team perfectly knows all the ins and outs of the infrastructure, they are much more likely to execute the right decisions at the right time. 
• Data security. The risk of external data transfer is much less likely when all the event logs, alerts, and incidents are stored and processed internally. As an option, organizations can co-manage the content development with external parties, yet without having to expose the data that they would like to keep private.
• Precise customization. The solutions that are being implemented within the SOC infrastructure are highly customized to the company’s needs.  

Cons:

• The need for strategic budget assessment. Organizations need to build the in-house SOC with a strategic approach, planning their future needs and budget in advance. Otherwise, they might face an unexpected situation when they fail to maintain a certain SOC budget and have to take down part of their cyber defenses.
• Continuous compliance awareness. Internal SOC teams need to constantly track compliance with regulatory requirements and adjust them in a timely manner. In the event of non-compliance, they might be forced to pay costly fines.
• High operational expenses. OpEx like subscriptions to threat intel feeds and software licenses end up being more expensive than an outsourced solution that comes with all these features on a single platform and doesn’t require further integrations or parsing.
• Insider knowledge limitations. Due to the internal process of documentation handling, quite often the critical knowledge is limited to a few dedicated experts. If they leave the company, the whole SOC might be left clueless once force majeure situations appear.
• False positives & alert fatigue. SOC systems monitor vast amounts of log data and frequently generate an excessive number of alerts which may or may not be real security incidents. Multiple false positives take up a lot of analysts’ time, while frequent and unimportant alerts lead to alert fatigue, making it more challenging for teams to notice the really important ones.
• Regular SIEM audits. Analysts will also have to spend time to perform regular SIEM audits, ensuring they are making the most of analytics-based tools in use, continuously optimizing performance, and fine-tuning the detection content.

Hybrid SOC

For companies that would like to have the best of both worlds, the in-house and outsourced SOC, there is a reasonable option in between. A hybrid SOC model typically provides the ability to maintain control over all aspects of the core monitoring function, without having to budget as much as for a fully in-house SOC. Moreover, the ability to seamlessly add the functionality of advanced integrations like the Detection as Code platform powered by SOC Prime unlocks access to the continuously growing detection content base that is essential for proactive cyber defense.

Pros:

• Reduced expenses. Not only CapEx but also OpEx is less than that with an in-house SOC because contract personnel for off-hours coverage is more cost-efficient than full-time staff.
• Scalability. It might become easier to transition to either a fully insourced or outsourced SOC later in case the organization finds it necessary. 
• Architecture flexibility. The agility provided by a hybrid model allows maintaining effective cybersecurity protection while keeping it highly specific.

Cons:

• Complicated management. Ensuring consistent coverage of SOC requirements between insourced and external teams might be challenging and incur extra management overhead.
• The tradeoff between lower prices and amount of control. Budgeting might become tricky and greatly depends on a hybrid infrastructure itself. If the organization operates its own SIEM or other security tools in use, it will spend CapEx just like with the insourced SOC. If the SIEM is owned by a third party, expenses are lower, but so is the level of control.

Overall, there is no single right approach to building a security operations center. The infrastructure, architecture solutions, and expenses should be carefully reviewed in terms of the organization’s strategic plans. It’s also important to consider implementing a next-generation SOC with an advanced set of IT systems and tools. Organizations can enable enhanced threat hunting capabilities providing analysts with a powerful exploration of unlimited volumes of security data. For example, to power up cyber defense capabilities, SOC teams can leverage free online tools, like CTI.Uncoder.IO for IOC-based threat hunting, or Uncoder.IO, a Sigma translation engine that enables rule conversion to multiple SIEM, EDR, and NTDR formats.