We’re as excited as anyone about the possibilities of cloud services for small businesses, but it can sometime be difficult to compare the value between in-house and hosted systems. We crunched some numbers to try and help you understand the differences between running Windows Small Business Server with Exchange vs. Orbits’ Hosted Exchange.

How many users do you have?

The more users you have the more the balance tips towards running your own server, but when you have less than 20 mailboxes it works out cheaper, without even taking into account any of the non-financial advantages of moving to the cloud.

Subscription vs. Buy-to-own

One of the reasons people find it hard to evaluate whether cloud services are a good option for them is that the pricing model is different. The pricing for Orbits’ Hosted Exchange is simple – £5 per mailbox per month. The price you pay for running your own system includes large upfront costs for server hardware and software, installation and support, but the incremental cost of adding another mailbox is negligible.

So to compare the two options we need to make some assumptions:

• The lifetime of the server is 5 years. You can of course keep systems running longer, but this is a typical replacement interval. If you run the system much longer, support costs will increase and you will be at an increasing disadvantage compared to the hosted system as this will always be running on modern hardware using the latest software.
• You will need support for your server. We have included a support charge at Orbits standard rate, we are not the cheapest, but we are far from the most expensive. Support for the hosted email system is included in the monthly price.

So how much can I save if I have 10 users?

The short answer is £2,940! The calculation goes as follows:
(All prices in this article exclude VAT.)

	Your own server	Hosted Exchange
Initial costs	Fujitsu Tower Server £960 Windows SBS 2011 £580 Install and Setup £400	None
Ongoing costs	Support £800/year	10 mailboxes = £50/month
Total over 5 years	£5,940	£3,000

You can adjust the calculation to your own number of users, but with these prices and assumptions the balance tips at 20 users and if you only have 5 mailboxes, you would save a massive £4,440. However, it’s not only about the raw prices, there are a number of other considerations too.

Other important benefits of Hosted Exchange

Firstly you don’t have a server in your office to worry about. Even with professional support to look after the machine, you have to find space for it and keeping your systems simple means there is less you go wrong.

Even though we haven’t included it in the calculation above, a server typically runs 24/7 and uses an appreciable amount of power. A typical server draws 200-300W of power, which at the current average price of 13.7p per kWh equates to £240-£360 per year

Next is reliability. Hosted Exchange runs on a cluster of servers in a datacentre with backup power and a spare system in another datacentre – all this means is the system should be running 99% of the time. And if is down for more than a few hours we will give you a refund.

The data is also kept in multiple locations, this means the chances of loosing data are very low. With your own server you would need to arrange for daily off-site backups, which is an another added expense or management hassle.

Most servers on office premises suffer at least a few days of downtime a year, this leads to lost productivity and frustration. And no-one is going to give you a refund if your own server is broken!

Finally and in many cases most importantly is flexibility. With Hosted Exchange you don’t need to know how many mailboxes you will need in 3 years, you can just add more accounts at any time. You can also delete mailboxes at any time – you only pay for what you use. If you decide you want to change systems, or the time comes when it makes sense to have your own server, you can cancel the whole account and migrate the data easily. There are no tie-ins.

With your own server, once you stump up for it, that’s it the cost is sunk.

Give us a try

If you think you could benefit from Hosted Exchange or any other cloud services, give us a call or send an email and we’ll see how we can help you out and put a customised quote together.