Email for the Small/Medium Business

I am a huge fan of Microsoft Exchange Server 2010. I am a huge fan of Exchange in general. I have been working with Exchange since 4.0 in 1996, and I have to admit that I have a certain warm fuzzy feeling when it comes to Exchange. I am biased. No doubt about it.

However, I am also a business man. When it comes to email, I realize how important it is to my company. I realize that without email, I can’t communicate with my clients, my vendors, and my business colleagues. If I had a choice, I would rather give up my phones than give up my email.

From my interactions with my clients, I have found that they have specific needs around their email. Generally, they all need:

  • Compatibility with Outlook clients
  • Mobile connectivity through Web browsers
  • Mobile connectivity through mobile devices such as smart phones
  • High uptime
  • Redundancy in case of server failure

If I take all of this at face value, I see my clients all needing Exchange Server 2007 or Exchange Server 2010. Most likely, they will need Exchange Server 2010 because they need redundancy and with 2010, you can get redundancy and high uptimes by using only two servers. To get the high uptime and redundancy by using Exchange Server 2007, you would require at least four servers. This is a pretty penny for many small and medium sized businesses. Assuming they already own all of their Microsoft Office client software that includes Outlook, they need to buy:

  • 2 Servers with the resources to run Exchange (assuming 2010) – Approx $3K each, 8GB RAM, Quad Core Opteron, Five decent drives – Total $6K
  • 2 Windows Server 2008 Enterprise server licenses – Approx $3,000 each retail, you need Enterprise for DAG support for redundancy
  • Back up software and agents for Exchange – Approx $1K for license plus agents
  • Back up tapes (This one is HUGE for many companies) – LTO-3’s cost about $25 each for 800GB compressed at 1 per day for a week, one each week for a month, and 12 each month for a year (7+4+12=23) for about $550 for a years worth of tapes for your rotation
  • Management software and agents for Exchange – Microsoft’s Ops Mgr would run ($430 per server for client license, plus management packs) Approx $1K
  • 2 Exchange Server 2010 licenses (We can use Standard Edition plus CALs at say about $1K for the server and $60 per user) $7K for 100 users
  • Antivirus and AntiSPAM software – ForeFront for Exchange is approx $15 per user per year – 15*100*5 years=$7.5K or 1.5K per year.
  • Then, add to it an Edge server or some kind of appliance for the perimeter network (optional) – We will go with $0 but know it will be much more.

Total 6,000+6,000+1,000+550+1,000+7,000+7,000 = a bit over $28,000 for a 5 year investment

Let’s say that I screwed up some place, which is likely. Or, let’s say that you are creative and purchased licensing on the cheap or went cheap on the servers. Being fairly conservative, I see this all coming to about $20,000 on the lower end. This environment will most likely have a life cycle of about 5 years at most. So, let’s figure $4K per year. This does not even include the administrator time to install and maintain it. That number could be pretty big, too. I will be conservative and say it only takes 10% of a FTE per year. Remember, this cost is to manage and maintain your Exchange Server environment, which includes keeping it updated, backed up, and protected from virus infections and SPAM. Just managing Antivirus and AntiSPAM solutions can take several hours a week. A fully burdened (meaning salary plus benefits and taxes) cost of $120K (again, this is extremely conservative) or more per year would put the administrative costs around $12K per year, so now we are talking about $16K per year, which I think is actually way too low. I am sure it is higher.

$16K per year for email. That sounds like a great deal of money for email for 100 users, and it is. Do the math yourself, and you might come up with a different number. This number, by the way, does not include site resiliency unless you have two physical offices and have a server in each office. Also, the costs here don’t reflect the costs of the shared services in a data center such as the servers fair share of cooling costs, rack space, power, floor space costs, network ports, offsite tape storage, possibly an additional tape head in the silo, and so on.

I am a small business owner. I can tell you that I about cursed a blue storm when I started looking at how much I have spent maintaining my own Exchange Server 2007 environment the last three years. I had to ask myself if there were any alternatives.


Option 1: Business Productivity Online Standard Suite (BPOS)

Microsoft sells their own hosted Exchange Server environment, Business Productivity Online Suite, that can be purchased by small and medium sized organizations. They will even support extremely large ones with some great discounted rates. It includes Exchange, SharePoint, and Office Communications Server along with Antivirus and AntiSPAM protection for the environment in the nice low cost of $10 per month per user. Personally, I love it. What a deal. So, if I have 100 users in my company, it would run me approximately $1,000 per month. That is comparable to hosting your own environment on the super cheap, and you get a really easy to use Web interface to add users. Microsoft manages everything for you. The total is $12K a year, but it will take some time to create and delete users in the environment as you get new hires, but I am 100% certain that is is a very small number.

There is a point where it is not cost efficient to use BPOS, and it is more efficient to host your own email. However, if you need high availability and redundancy plus site resiliency (losing your entire site), it is hard to come close to the price of BPOS per user in most organizations just for Exchange email. Include SharePoint and OCS in the mix, and it really is a great deal to use BPOS.

BPOS meets all of the requirements for remote connectivity including using smart phones, even the iPhone, but not Blackberry. I am not sure about Droid, but I am pretty sure you can use Droid as well.

BTW, we get the added bonus of our external email clients not connecting to our network through our firewall, so we can lock down the firewall better and our overall bandwidth requirements will be reduced. All of our external email clients will go directly to the BPOS environment on the Internet.

Option 2: Premier GMail

Premier Google Mail costs $50 per year per user. Wow, that is a great price in comparison to BPOS. Google offers a Web interface, the ability to use Outlook and to use mobile devices such as Windows Mobile, iPhone, Blackberry, and Droid phones as well. In fact, Google supports Microsoft’s Activesync technology so you can use it for any mobile device that supports Activesync.

Google uses its own Postini product to protect against AV and SPAM, and they handle the multi-site redundancy as well as all of the backups, too. We also gain the reduction of bandwidth benefit like the BPOS option.

So, 100 users at $50 a year = $5,000 per year.

Umm… Dare I say it? I think money talks, and if the same functionality is there, then this sounds like a pretty easy decision.

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