Law Technology

Hosted Exchange Server Follow-up: It Needs to Be Well-Considered

By Abraham

Thanks to those who commented on my earlier post about Hosted Exchange services.  There were a couple of points made that I thought it might be useful to follow up on.

First, there’s the question as to what advantage Exchange Server has over other email services like those provided by Google.  Ross made a good point about email being just one part of what people do with Exchange.  Calendars, Tasks, and Contacts are all also part of the package.  Using Exchange makes the small but really useful things in Outlook possible: things like meeting scheduling, sending as other users, and server-side mail processing rules.  These are the “secret sauce” items that Microsoft builds into the Outlook/Exchange combo that you just can’t get with other services.

There was also the question about why, if these services exist, I would still say that most small firms are still better off having their own server.  There are a couple of reasons.  The first is that, as Ross mentioned, Small Business Server is a real bargain for what you get.  Even small firms are almost always best off having a dedicated file server, and as long as you’re going to have a server, getting the Windows Small Business Server (SBS) software is practically a no-brainer.  Ordered “OEM” (meaning it comes bundled with server hardware from vendors like Dell, Lenovo and HP), Small Business Server 2003 - which remains available (Windows 2008 SBS is impressive but hundreds of dollars more costly, so unless your budget is “comfortable,” the 2003 edition is still well supported and very mature), is rock solid and is only $499 (in the case of Dell). If you have two hosted email accounts at $10/month, hosting your own email pays for itself in just over two years.  More than two hosted mail accounts and SBS can pay for itself in less than a year. 

There’s also the factor that another reader mentioned: you don’t have to worry about who controls your data when you host your own email.  You have total control over those stored messages when you have Exchange Server running internally.  Granted, this can be both a blessing and a curse.  You don’t have to worry about whether the service provider will be in business a year from now.  You don’t have to worry about whether the provider is being honest about who has access or whether backup is being done.  On the other hand, you do have to worry about actually addressing those issues yourself.  Fortunately, with a minimal amount of care and feeding, Small Business Server is remarkably able to hum along and just keep working.  It’s like the Honda Civic of email servers - remarkably reliable and frugal to run.

So, in determining whether or not to use internal or hosted Exchange services, there are a number of factors you will want to consider:

1. How many users will you have?  The more users you have, and the more email accounts you need, the greater your monthly cost will be for hosted Exchange services, usually $10-$15 per month per user.  Adding users to your own server - which allows five included in the base software price, requires the one-time cost of a Client Access License (or CAL), usually purchased in packs of five or ten and averaging $50-75 per user.  Clearly, the more users you have, the more financial sense it will make to host your own mail. Frankly for our own clients, we see crossing over to two users from one is the realistic dividing line (really!)
   
2. How much e-mailbox space do you need?  Most hosted Exchange mailboxes are limited to a certain size.  Now, you can always archive your emails to a local hard disk using Outlook, but if you’re one of those people that likes to keep many gigabytes of data in your on-line mailboxes, you may have to pay more to a hosting service.  On the other hand, if you host your own email, you can use all the storage that’s available on your server’s hard disk. So if you’re a mail packrat, local Exchange will likely make more sense especially for solos.
3. Do you have a place for a server?  Small firms based out of shared offices or home offices may not have reliable fast internet access, or may lack control over the building network infrastructure, or may not be able to obtain physical security for their own fileserver.  Or your office may lie behind a rickety-looking levee in New Orleans! (like one of our clients). In such cases, a hosted Exchange server is often much more convenient and safer than trying to cobble together some alternate online solution. 
4. How comfortable are you in trusting a third party to handle a sensitive and confidential business operation like email?  If you make local backups (read Ross’ most recent article on data backup processes for small firms here!), a positive attitude about the future of ethical guidlines about third party storage of confidential information in the absence of local rules, and have good litigation skills, you may be willing to trust your service provider.  Others, however, are willing to go to almost any lengths to maintain total control over that data - there’s not a right or wrong here - just issues that MUST be thoroughly considered. That’s actually where our consulting work with clients comes in.

Now, assuming in your weighing of these issues that you come down on the side of having someone else host your Exchange services, how do you go about picking a provider?  There is no hard and fast answer for this; there are certainly a lot of options available.  You might consider something generic and inexpensive, like GoDaddy.com.  You could decide on something with more features, like ExchangeMyMail.com, which can work with a Blackberry Enterprise Server.  Or you could decide that you’re willing to pay a little more for the services of a behemoth unlikely to disappear any time soon, and get your service directly from Microsoft itself, who charges a reasonable $10 per month per user for basic Exchange service, but requires a minimum of 5 users. 

In the end, the decision of which vendor to use, like deciding on any other vendor, has to be made on some combination of features, reliability, and price.  One of the things that we do for our clients is help them determine where those factors intersect for themselves, based on their unique practice circumstances and preferences, the programs they use in their practice that need to be integrated with, then narrow down the options appropriately.

Full post as published by Ross Ipsa Loquitur on March 19, 2009 (boomark / email).