What's Next in Technology!

December 10th, 2010

What's Next for the Small to Medium Sized Business? Microsoft Office 365:

We should all know the story by now. While there are plenty of great technology solutions out there that could improve a business's productivity and security, the price tag for these systems has just made them out of reach for the small business. For decades, Microsoft's business model was to sell servers and systems which had significant up-front licensing and hardware fees, forcing small businesses to find cheaper alternative systems which really were not complete, but were acceptable. Most of these alternatives did not utilize some of the best options in email and document sharing and security.

For those who did take the leap into one of these technologies, they are faced with a hardware and licensing upgrade that can be just as expensive as the initial investment. The sticker shock for such upgrades causes small businesses to skip upgrading, and push hardware to beyond its recommended life span, putting their operation at risk. Plus, they don't get the latest features associated with newer versions of the technology.

Now, with Microsoft Office 365, there is finally a total package solution designed for the small to medium sized business that provides all the best that Microsoft has to offer as far as securing and collaborating with email and documents, but without the up-front/upgrade sticker shock. We feel this new offering will have a direct impact on not only a company's technology, but the overall technology budget going forward. Every small business should give a serious look at Office 365 before moving forward with any other technology decision.

What is Office 365?

Microsoft Office 365 combines the following Microsoft products into a combined hosted, monthly fee, Cloud service:

  • Microsoft Exchange Server (works directly with Outlook for securing and sharing email)
  • Microsoft SharePoint Server (works with Windows operating system for securing and sharing documents across the web and internally)
  • Email antivirus and antispam filtering
  • Microsoft Lync (Communication tools that allow for effective meeting and web communication)
  • And, finally, Microsoft Office, made available both thru a website (Office Online), and/or directly installed onto a computer (Office Professional Plus), but rented on a per-user basis

These products can be ordered individually per user, or bundled together into different package options. Since these run over the Cloud in one of Microsoft's secure data centers, there is no hardware to purchase. One of the best package options is the one that combines Exchange and SharePoint, along with Microsoft Office, for $24 USD / month / user. Without Office, that same offering is $10 USD / month / user.

At this time, Office 365 is in beta, and due to be released early 2011. Office 365 is actually the next generation of Microsoft's current hosted cloud offering called Business Productivity Office Suite, or BPOS which has been operating for over a year now. The current BPOS offering is very similar to Office 365, minus the Microsoft Office licensing, and has the same bundled price tag ($10 USD / month / user ).

Microsoft has already defined a smooth migration path from BPOS to Office 365. Therefore, if your business is ready to get started with Microsoft's Cloud systems today, go ahead and migrate to the Microsoft BPOS package, and switch to Office 365 as soon as it becomes available.

BPOS Pricing
$10 / month
(Includes 25 GB mail storage)
 
Calc Estimated Cost

Seem like a lot of cost? Take a look at what it used to cost:

A lot of business owners have a hard time understanding what technology does for them. But, everybody knows how much it can cost. Let's take a look at what the option was for small business up until this offering:

THE OLD PRICEY WAY: Sample Configuration with Microsoft Small Business Server:

The previous option for providing some of these systems was to install a Microsoft Small Business Server. SBS Server combined Exchange, SharePoint, and some other decent tools (fax server, etc.) into a single system that would be installed in most cases onto the business office premises. That server would need to be backed up nightly, and anti-spam and antivirus filtering software would also need to be added to protect the server. For individual users, Microsoft Office would need to be purchased for each user. Ok, so let's go thru those costs for say a 10 person company:

  • DELL PowerEdge Server with Microsoft Small Business Server with 10 users: At least $5,000 USD in hardware and licensing, and about $2,000 USD in up-front labor. Additional users could be added in blocks of 5 for about $400-$500 USD / block. This server will most likely need to be upgraded or replaced after 4-5 years of operation.
  • Many groups use a service like Microsoft Forefront Online, or Postini, to filter each mailbox. These services can run upwards of $2 USD / mailbox / month: Price: $20 USD / month
  • Backup of these servers were mostly on tape or hard drive based backup in the past. Such tape drive systems would vary in price based upon how much had to be backed up nightly. Up-front costs would have been in the $2,000 USD range for both the drive and backup software (i.e. Symantec Backup Exec). Now, these types of services can be backed up with offsite backup for about $1 USD / month / GB of storage. So, estimate about 50 GB of storage, so $50-$150 USD / month for backup.
  • Microsoft Office 2010 Professional Plus Edition: $499 USD / user retail + install per user : 10 users = $4990 USD (Most likely $6k USD including installation)
     
  • Total Estimate: $13,000-$15,000 USD up-front, $70-$170 USD / month
  • Upgrade Microsoft Office every 2 years: $3,000-$4,000 USD for 10 users
  • Upgrade Server after 4-5 years: $7,000-$10,000 USD

THE NEW AFFORDABLE WAY: Same configuration with Office 365:

Same systems, but Exchange, SharePoint, backup, and Microsoft Office are all provided thru Microsoft Office 365, hosted on the Cloud, so no server to maintain onsite. Only up-front costs required would be the labor to migrate to Office 365.

  • Office 365 for Enterprises (BPOS services along with full license of Microsoft Office Professional Plus). Includes Lync Online for IM and online meetings: $24 USD / user / month, includes 25 GB of email storage per user, and several SharePoint sites: 10 Users = $240 USD / month with 250 GB of total storage, all backed up, and filtered.
  • Latest versions of Office are included (along with the latest server versions as they are released). So, when Office 2012 comes out, the business gets for no additional cost other than the time to install.
  • Estimated labor for conversion to Office 365: $2,500 USD
     
  • Total Estimate for Office 365: $2,500 USD up-front, $240 USD / month
  • Upgrade Microsoft Office every 2 years: Upgrades are included, so no cost!
  • Upgrade Server after 4-5 years: No server to upgrade, so no cost!

So, not using Exchange or SharePoint today? What does this give you?

  • Microsoft Exchange, working with Microsoft Outlook and most mobile PDA devices on the market today like the iPhone and Android, allows for centralized management of ALL of your email from anywhere. You have access to all of your Outlook email thru Outlook itself, a website (called Outlook Web Access), and with ActiveSync enabled on the mobile phone, all of your contacts, calendar, and email items are automatically synced over the internet. No need for that clumsy USB cable to sync that information anymore. Plus, since your email is centralized on a server located in a highly secure and redundant data center, you will no longer experience that loss of all your email when your laptop hard drive crashes. Sound familiar?
  • Microsoft SharePoint does the same thing, but with your documents and shared calendars. It provides a central repository, Internet based, where you can share your documents with others, both inside and outside your organization. Again, your documents are fully backed up. And, SharePoint access has been directly integrated with the latest versions of Microsoft Windows and Office. Very clean operation for collaborating with company documents.
  • And, of course, most small businesses have "leap frogged" versions of Office due to the price tag to have the latest version. Most users right now are struggling at Office 2003, because of that price tag. But, how many of you have struggled with the latest ".docx" and ".xlsx" documents created by other users running Office 2007 or 2010. With Office 365, you don't have that huge price tag to goto the next level of Microsoft Office. You get it as part of the plan.
  • You get all of your information from anywhere, which you might struggle with right now. Microsoft Office 365 is hosted on the Cloud (another fancy word for the Internet), so you can get to your information quickly and securely from almost anywhere. Trying to get that done thru the old ways of document and email systems can be a bit of a challenge.

When should you make the switch to Office 365?

BPOS Now, and upgrade to Office 365 first quarter of 2011: Make the switch right now! Sign up for Microsoft BPOS today for $10 USD /month / user USD. We recommend you make the switch today to get all the benefits of Exchange and SharePoint right away. Once Office 365 is released, Microsoft will handle the transition for you from BPOS to Office 365.

What about purchasing Microsoft Office? If you haven't upgraded to Microsoft Office 2010 yet, then go ahead and upgrade to Microsoft BPOS, and wait to upgrade to Office 2010 until Office 365 is released early in 2011. No need to pay that high price tag on Office if you can get it included with your Office 365 agreement.

The Conclusion on Office 365 and Microsoft Online services?

This is a big deal. These systems will have an impact on how your business operates, and will definitely improve productivity. Plus, there is very little to lose without the up-front costs. Give it a whirl!

If you are interested in trying out Microsoft BPOS for 30 days, Click here to activate your 30 day trial. Once you are ready to convert to Microsoft BPOS / Office 365, feel free to contact us at info@computerperson.com, and we'll send out an official quote with updated quantities for your corporation.

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