The challenge of simple IT: align the needs of the business to the budget, add capability without complexity

Cloud for Small Business – Hot or Not? Redux (UPDATE 2/24/14)

Google Apps. Microsoft Office 365. What are they and why do we care?

Interesting questions. What does every modern office need? A productivity suite to create and edit documents, spreadsheets and presentations. A messaging system, for sending email and enabling chat. A calendaring system, to facilitate time management and shared scheduling. A collaboration system, to corral projects, tasks, data and team members.

The classic solutions consists of the Microsoft Office productivity suite, Exchange Server for email and calendaring, and Sharepoint Server for collaboration. Why would we consider anything else?

Well, cost is one good reason. Let’s take Microsoft’s recommended small business scenario, Windows Server with Exchange Server, and add Sharepoint 2013 and Office Professional 2013. Windows Server, Exchange and Sharepoint are going to cost us $7,905. Per-user licenses are an additional $191. Office 2013 Pro will cost $367 per user. Assuming we have twenty-five users, our software costs are $21,855.

Now let’s add a decent Dell server to the mix, say a T420 with 32GB RAM (for the Exchange and Sharepoint virtual servers), a pair of mirrored 500GB drives for the server OS and four 500GB drives in a RAID array for data. With a support contract, it will cost us just under $5,000. This setup will last about five years, so let’s add it all up and divide by five, and then again by the number of users. That works out to just under $215 per user, per year.

So where would Google Apps or Microsofot Office 365 fit in our modern office scenario? They’re both “cloud” application suites. In other words, they live in someone else’s data center and we don’t have to worry about the where, what or how. We don’t need to buy a server and software and worry about maintenance or downtime; instead we pay an annual per-user fee for our document, email, calendaring and collaboration needs. Just to give us a rough idea of cost, let’s pencil out the same basic features as above, again for twenty-five users.

Google Workspace includes a productivity suite, messaging, calendaring and collaboration. The productivity suite provides documents, spreadsheets, presentations, drawings & charts and fillable, shareable & routable forms. For messaging it provides email and text, voice & video chat. User & resource calendaring and shared scheduling are there. Collaboration includes real-time multi-user document editing and project centralization for documents, team communication & task management. 30GB of syncable, shareable online document + email storage space per user. Oh yes, and user-to-user(s) screen sharing. Google Apps is a flat $50 per user, per year.

Let’s take a comparable Microsoft Office 365 plan, Office 365 Enterprise E1. Does it match Google Apps feature-for-feature? Yes, for the most part. Some minor differences, such as 25GB per user for email and 7GB per user of syncable, shareable online document storage. The E1 plan will cost us $96 per user, per year.

So how does that work out over five years? The onsite solution will cost us $26,855. Microsoft Office 365 (Enterprise E1) will cost us $12,000. Google Apps will cost us $6,250. Are there important differences? Yes, there sure are. Are any of them show-stoppers? Most likely not. Can we run our modern office on either of these cloud platforms? Unequivocally, yes. And we’ll save some cash by doing so.

UPDATE Feb 24, 2014: It’s been a while, I know. Sorry for the long delay, there’ve been a few storms and a few changes since the summer. I’m looking forward to some un-dramatic calm for the next few months. In the meantime, Microsoft has re-released their online offering and has chosen the sensible name “Office Online.” Some new features, some new subscription plans. Unfortunately I won’t be doing the in-depth review that I promised; that ground has been well-trodden in the last few months.



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