No matter where or how you access it, email is the backbone of most companies' communications between staff, customers and suppliers.
So it's crucial to always have immediate and easy access to your business email, to be able to scale up your email server or email host as your company grows, and to have the right type of email server/host for your particular business needs.
Choosing the right email solution for your organization depends on several factors: reliability, integration, scalability and security are at the top of the list.
These are similar to the issues we discussed in a previous blog post about on-site vs.
cloud-based file storage.
The cost differences between Hosted Exchange and on-premise Exchange should certainly be a factor in your decision, but it shouldn't be the deciding factor.
If it is, then you are likely to end up with the wrong solution that will cost your business more in the long run from productivity loss or other business process or integration limitations.
We recommend calculating the total cost of ownership of each solution over a 3 or 5 year period when making your decision.
So how should you decide between an on-site Exchange server and a Hosted Exchange service? Let's take a look at what you should consider for each solution.
On-Site Exchange At a glance: This is a viable solution for large/enterprise-level companies who want instantaneous inter-office email, or those with more than 100 users, or already have the appropriate space and network infrastructure equipment to support an on-site server.
This is also the de-facto standard for businesses who need to integrate their Exchange server with another business management software system.
Considerations: • The cost of an on-premise server and software can be treated as either a one-time capital cost or as an operating expense (it can be financed or leased.
) • When calculating the total cost of ownership, use a minimum of three to a maximum of five years.
A Windows server has a five-year life cycle so you must amortize that initial cost over five years.
Why five years? Hardware warranties for servers are only feasible cost-wise, and usually are only available, for five years.
Also, the hardware failure rate of hardware over 5 years of age increases dramatically, increasing the likelihood and length of system downtime.
• The organization must have the IT personnel on staff or a reliable IT partner to implement and pro-actively manage the Exchange server, and troubleshoot problems that may arise.
• You will have instant intra-office email delivery.
• You can customize your email server to your company's needs and integrate it with other business management software packages.
• Unless you have fail-over systems in place, you run the risk inherent in having a single point of failure (the server), or from using a single ISP, or an insufficient amount of run-time on your battery back-ups.
• Scalability can be more complicated and/or costly than Hosted Exchange.
• Heightened confidentiality - organizations in highly regulated industries often prefer on-site email servers because they can install monitoring systems and institute tighter security measures than what may be available in a Hosted Exchange environment.
• Because the on-premise server is physically located within your office, you have physical control over the data.
This is a double-edged sword: you must ensure that the server is located in a secure location, but because you have control over access, there should be a small number of people who have access to it.
Hosted Exchange: At a glance: An economical and convenient solution for small and medium-sized businesses.
Hosting your email in the cloud (whether Hosted Exchange or another Cloud-based email service (like Gmail, Hotmail, Yahoo Mail) avoids the need for on-premise servers and the monthly per-user fees are typically very affordable until you hit a certain number of accounts, at which point it can be more economical to use an on-premise Exchange server.
Considerations: • Smaller companies can enjoy the benefits of an enterprise-grade infrastructure and the functionality of Exchange at a lower total cost of ownership than an on-site Exchange server.
• There's no need to budget for hardware maintenance, software upgrades and additional IT personnel or additional cost from your IT partner.
• Technology and marketplace competition have generated more features at a lower price...
as low as $4 per user right now.
• It can reduce the risk of downtime and data loss - the data center that hosts your email server typically will have greater hardware, power, and Internet redundancies than what the typical small business has.
• Your company does not have physical access or control of the Hosted Exchange servers, so the storage, backup and access to your email is outside of your control.
• There is no capital cost except for the time to perform the initial setup or migration.
• No need to maintain or house equipment.
• Sending and receiving emails between users at the same company is slower than with an on-site server.
The speed can be significantly slower if your office has limited bandwidth or if you are sending large attachments.
• Highly and easily scalable-you can add new email accounts quickly.
• Most Hosted Exchange provider will keep their Exchange servers up-to-date with security patches.
• You have little to no control of how or when your Exchange hosting company will migrate your current version of Exchange to a newer version.
E-mail Redundancy For Both Options One thing to keep in mind is that for both Hosted Exchange and on-premise Exchange servers, we recommend using a third-party "store and forward" service that will prevent you from losing emails when your server is down.
Yes, even servers in the Cloud go down! Some store and forward services even allow you to send and receive emails in the event that your primary email server/service is down.
What's Right For Your Business? When considering on-site vs.
Hosted Exchange, first define your most compelling needs and priorities, and factor in your IT resources and number of users.