Exchange Online

Exchange Online is a Microsoft-hosted service that offers most of the Exchange feature set at a fee that compares favorably to on-premises licensing costs, especially after a 50% price reduction in late 2009. Customers who are contemplating an upgrade of internal systems to Exchange Server 2010 and are comfortable with the legal and security implications of outsourcing e-mail to a third party may want to consider Exchange Online.

Largely due to competition from other cloud computing vendors, pricing for Exchange Online is exceptionally competitive and in some cases isn’t significantly more than Microsoft’s on-premises licensing fees. For example, over a three-year term, the cost of licensing Exchange Online (on shared, “multitenant” servers) is only about 40% higher than the cost of purchasing Exchange Server 2010 server licenses and SCALs with Software Assurance, and less expensive than purchasing server licenses and both SCALs and ECALs with SA. Adding in savings for hardware, system administration, power, and license compliance costs associated with on-premises systems likely tips the total cost scale in Exchange Online’s favor.