How mid-sized businesses can cut email costs by replacing premises-based services

 

Now more than ever, companies need their employees to remain connected and productive. New, affordable cloud-based solutions enables companies to transform operations while trimming expenses and reducing the burden on IT support resources.

“An average 25-person business saves $11,556, or 82 percent, during the first year of replacing its premises-based email and messaging with a cloud-based one. This yields a two-month pay back period,” says Mike Maloney, vice president of business services at Comcast.

Smart Business spoke with Maloney about how to save money by moving your business toward cloud-based solutions.

What  challenges are businesses facing with setting up and managing email and messaging?

Small and mid-sized businesses have limited IT staff and must balance their IT expenditures against other corporate priorities. Setting up and managing various pieces, including email and messaging, is expensive. Not only are the initial equipment expenses sizable, but ongoing IT support, server maintenance, licensing and software updates also add costs in future years.

How can businesses decide if the implementation costs of a cloud-based solution are worth it?

In 2009, the Yankee Group researched the real costs of email and messaging operations in a 25-employee business for one year. Its cost results found:

 

On-premises

Deployment   $0

Licensing, maintenance, support   $12,000

Security   $1,382

Backup   $638

Training   $0

 

TOTAL   $14,020

Cloud

Deployment   $240

Licensing, maintenance, support   $1,761

Security   $0

Backup   $0

Training   $0

TOTAL   $2,001

The upfront migration and implementation costs of the Microsoft/Comcast cloud-based platform of $2,001 still resulted in savings. Additionally, the cost savings grew to 84 percent over three years, for a total savings of $36,042.

The study assumed there were no custom-built exchange applications; no unified messaging platforms; standard email and messaging security; and a server already capable of handling on-premises email and messaging. In addition, the features and functionality were replicated in both email solutions, even though cloud-based technology typically has more applications and features.

With the help of telecommunications and computer professionals, employers can explore the cost and feature trade-offs between hosted and on-premises email. A hosted solution even can be appropriate for a small business with 10 or fewer employees that generally has no IT staff and where an on-premises email might be impractical.

What are some of the additional features found in cloud-based email and messaging?

Features that are commonly found with both on-premises and cloud email are addresses with company domains, shared calendaring, shared contacts, email storage of 2 gigabytes per year, anti-spam, anti-virus, mobile email, and email archiving and retrieval. Even with these shared features, there still are cost savings with the cloud because anti-spam and server-based anti-virus, which companies are typically paying for with their premise-based email and messaging, are included as part of the cloud.

Some additional cloud features include a collaboration solution such as Microsoft SharePoint, secure email backup and document sharing. The cloud’s secure email backup is important because many small or mid-sized companies employ tape drive based storage for this service, which comes with a fairly low level of security as tapes easily get lost, stolen or damaged.

Based on research into cloud-based email and messaging, what steps do you suggest mid-sized business IT departments take?

  • Switch to cloud-based messaging and email platforms, empowering remote and mobile employees. A number of vendors, including Comcast, provide a compelling suite for businesses.
  • Take the opportunity to start using cloud-based collaboration solutions. A collaboration solution, such as Windows SharePoint, can be used for sharing documents where multiple people can access a document simultaneously and incorporate a number of comments and edits. This software also is useful for sharing files that are too large to email such as those with high-quality graphics, technical diagrams or photographs.
  • Budget a few IT days for training. Switching applications creates stress, so plan for training, even if these costs are only opportunity costs for your IT employees. Not all organizations will need this, but it provides a safety net for companies where the transition to cloud-based technology is more difficult.
  • Develop a good change-management plan to help alleviate end-user pains. Switching from premises-based email to the cloud can be less onerous than switching vendors’ products, if you stay within the same company. Therefore, the change-management plan can be fairly simple, but make sure it includes employee outreach, reminders, training services, online guides, printed guides and contingency plans.

A hosted solution can provide a level of simplicity, reliability and functionality while offering a more professional-grade solution to emailing and messaging.

 

 

 

Note: The Yankee Group is a leading source of insight and counsel trusted by builders, operators and users of connectivity solutions for nearly 40 years. For more information, visit http://www.yankeegroup.com.

Mike Maloney is a Vice President of Business Services at Comcast. Reach him at mich[email protected]

Insights Telecommunications is brought to you by Comcast Business Class

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