Cloud vs. Cloud: Comparing the TCO of Office 365 and Private Clouds
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    Cloud vs. Cloud: Comparing the TCO of Office 365 and Private Clouds Cloud vs. Cloud: Comparing the TCO of Office 365 and Private Clouds Document Transcript

    • WHITE PAPER Cloud vs. Cloud: Comparing the TCO of Office 365 and Private CloudsON An Osterman Research White Paper Published March 2012 SPONSORED BY SPON sponsored by Osterman Research, Inc. P.O. Box 1058 • Black Diamond, Washington • 98010-1058 • USA Tel: +1 253 630 5839 • Fax: +1 253 458 0934 • info@ostermanresearch.com www.ostermanresearch.com • twitter.com/mosterman
    • Cloud vs. Cloud: Comparing the TCO of Office 365 and Private CloudsExecutive SummaryThe Microsoft stack of core communication and collaboration offerings – Exchange for email andcalendaring, SharePoint for content management and collaboration, and Lync for real timecommunications and telephony – can be provided using three basic delivery models:• The traditional on-premise model using in-house servers, software and IT labor.• A public cloud model, such as Office 365, in which each service is offered for a fee per user per month and all backend infrastructure is multitenant and located off-premises.• A private cloud model, in which the servers and software are all dedicated per customer and located in a secure third party data center, but the infrastructure is managed remotely by a service provider for a fee per user per month.GOAL OF THIS WHITE PAPERThe primary purpose of this white paper is to compare and contrast the “Cloud vs. the Cloud”(public vs. private), as well as the traditional, on-premise approach, in terms of their Total Costof Ownership (TCO), and to explain why key differences exist between them. The paper willwork to dispel some of the traditional myths relating to cloud services for communications andcollaboration in general and relating to the public cloud (as represented by Office 365), and therapidly emerging private cloud model.KEY TAKEAWAYS• While some decision makers believe that the cloud can provide cost benefits only for small organizations, our cost model demonstrates that enterprise-level customers will also achieve significant cost savings. For example, an organization of 5,000 users implementing the basic Microsoft stack of Exchange, SharePoint and Lync will save 19% with a private cloud compared to a conventional on-premise system.• Conventional wisdom holds that the communications and collaboration public cloud offers the most cost savings of any delivery model. Here, TCO calculations show the public cloud to be less expensive (21%) than the private cloud when comparing basic capabilities.• However, most medium-sized and large organizations will require a variety of enterprise- grade capabilities. When these additional features are factored in, the pendulum swings the other way and the private cloud ends up as less expensive (20%) compared to the public cloud. For example, adding bandwidth, storage and an upgrade to Office 365 E2 make the cost of Exchange in the private cloud significantly less expensive (26%) than when delivered via the public cloud. The cost of providing Lync voice services makes private cloud delivery of Lync also much less expensive (39%) than its public cloud counterpart.• Cloud delivery is less expensive than on-premise delivery primarily because of the reduced labor costs associated with the cloud. Moreover, cloud delivery provides the additional benefit of freeing up in-house IT staff members for other tasks that may provide more value to the organization.©2012 Osterman Research, Inc. 1
    • Cloud vs. Cloud: Comparing the TCO of Office 365 and Private CloudsIMPORTANT DETAILS IN THE APPENDIX OF THIS WHITE PAPERWe encourage readers of this white paper to examine the cost tables included in the Appendixof this white paper. These tables provide the detail that supports the conclusions we offer inthis document.Choosing the Right Delivery and Management ModelDELIVERING THE MICROSOFT UC STACKThere are three basic delivery models for providing email, collaboration and unifiedcommunication services:• On-premise Servers and other infrastructure elements are deployed, configured and managed on the customer premises and managed by in-house IT staff members. This is the conventional model that has traditionally been used by most Exchange, SharePoint and Lync-enabled organizations.• Public cloud A third-party provider (such as Microsoft) manages a data center and customers rent services on fee-per-user/per-month basis. This model is growing in popularity and is used by Office 365 customers, and for many years previous to that by hosted Exchange customers.• Private cloud Servers and other infrastructure elements are located in a dedicated co-lo facility but are managed either by the hosting company or remotely by a third party managed service provider. This model is also growing in popularity because it offers a “hybrid” approach: the security and resiliency of the on-premise delivery model combined with the cost and IT labor savings of the cloud model.What is the Least Expensive Approach?THE COST DIFFERENCES BETWEEN DELIVERY AND MANAGEMENT MODELSCAN BE SUBSTANTIALAs shown on the following pages, the differences in the costs of providing the various solutionsin the Microsoft stack can vary substantially based on the delivery model used. For example,the cost of a complete Exchange deployment for 5,000 users is 26% less expensive whendelivered via a private cloud compared to the public cloud, and 13% less expensive comparedto an on-premise deployment. Similarly, the cost of deploying the entire Microsoft stack ofExchange, SharePoint and Lync – along with additional capabilities like business continuity, add-on storage farms, additional bandwidth, etc. – is 10% less expensive when using a privatecloud compared to the public cloud, and 16% less expensive than when using on-premiseinfrastructure versus a private cloud.©2012 Osterman Research, Inc. 2
    • Cloud vs. Cloud: Comparing the TCO of Office 365 and Private CloudsWHY IS THE PRIVATE CLOUD THE LEAST EXPENSIVE APPROACH?The table below provides a comparison of the traditional, on-premise model of deliveringservices with the public and private cloud approaches. In a nutshell, the private cloud model ofdelivering and managing the services in the Microsoft stack is less expensive than the publiccloud because of two primary factors:• While public cloud providers include a variety of hardware, switching, storage, license fees and other features in the base price of their offerings, this base price is significantly higher than the fully amortized price of the hardware, software and other infrastructure elements offered in a private cloud deployment.• When deploying a full-featured enterprise-grade system, some additional features are typically much more expensive when deployed in a public cloud model. For example, as shown in the Appendix to this white paper, features like adding voice functions to Lync or adding extra bandwidth in an Exchange environment are much more expensive in the public cloud than in a private cloud scenario.Comparison of Exchange, SharePoint and Lync TCO by Delivery Model On-Premise Public Cloud Private Cloud • Low amortized cost of • No cost for hardware, • Low amortized cost of Exchange CAL + Server + storage or deploying Exchange licensing Software Assurance infrastructure • Low cost for support Exchange licensing • No cost for additional PROS hardware, storage and deployment • Lowest cost for support • Higher cost for additional • Much higher costs for • Higher cost for additional hardware, storage and additional services, e.g., hardware, storage and deployment compliance, archiving, deployment than in the • Highest cost for support Office 365 upgrade public cloud Exchange because of need to manage • Additional costs (not CONS infrastructure using only in- shown) for hardware and house personnel software for proxy servers and federation services to support cloud access©2012 Osterman Research, Inc. 3
    • Cloud vs. Cloud: Comparing the TCO of Office 365 and Private CloudsComparison of Exchange, SharePoint and Lync TCO by Delivery Model (concluded) • Low amortized cost of • No cost for hardware, • Low amortized cost of SharePoint CAL + Server + storage or deploying SharePoint licensing SharePoint Software Assurance infrastructure • Low cost for support PROS licensing • Lowest cost for support • Higher costs for BC/DR • High monthly costs for • Higher costs for BC/DR • Highest costs for testing SharePoint Online add-on farm • Testing & Development • Highest costs for Farms must be rolled out development add-on farm on-premise or in a private • Highest costs for support cloud. • Additional costs (not SharePoint shown) for hardware and CONS software for proxy servers and federation services to support cloud access • There is a large feature gap between SharePoint Online and SharePoint in the Private Cloud • Much less expensive & • No cost for hardware, • As inexpensive as the more full featured than storage or deploying public cloud for support public cloud for voice infrastructure Lync services • Lower cost than on- PROS • Lower overall costs than in premise for basic services the public cloud for a variety of ancillary services • High costs for support • High monthly costs for Lync Online • Even using the most functional Lync Online offering, there is still a Lync large feature gap with Lync CONS On-Premise or Lync in the Private Cloud • Hybrid Deployments are not supported. You must deploy Lync Online or Lync-On Premise.COMPARING THE COSTS BY SOLUTION AND DELIVERY MODELFor purposes of our cost analysis, we compared the total cost of ownership for Microsoft’s threeprimary enterprise offerings – Exchange, SharePoint and Lync – using on-premise, public cloudand private cloud deployment models over a 36-month lifecycle. Our analysis focused on anenterprise of 5,000 users. Moreover, we developed a basic or “Required” configuration – thatset of infrastructure and services required to support basic functionality for each element of theMicrosoft stack – and an enterprise grade or “Additional” set of capabilities, both of which arepresented in the charts on the following pages. The analysis and interpretation of Microsoftlicensing (for both on-premise and online) is a complex art. As evidence of this complexity thesidebar on the next page calls out one single add-on example in the form of Exchangearchiving.©2012 Osterman Research, Inc. 4
    • Cloud vs. Cloud: Comparing the TCO of Office 365 and Private CloudsBecause of the sophisticated nature of the modeland its high level of detail, we have presented the TCO and Differences forcalculations in an Appendix rather than present them EXCHANGE ARCHIVINGin the body of the white paper itself. To the extent Even for native archiving in Exchange therethat “your mileage may vary”, it is important that the exists some confusing and key differences inreader uses the conclusions of this whitepaper as cost between Cloud and On-Premise:directional guidance, not as hard and fastconclusions that will apply in every circumstance. 1. Microsoft Exchange Online Archiving, aDeveloping cost models for offerings as complex as hosted archiving solution for on- premises Exchange 2010 mailboxes,those discussed in this white paper requires some cannot be used with Office 365.level of interpretation and judgment, and so somereaders may disagree with aspects of the cost model 2. For Exchange Online (in Office 365) thewe have developed here. core archiving capability is the same as that provided for on-premise Exchange at $5 per user per month.Moreover, because Microsoft continues to evolve itsOffice 365 offering, it is important to note that the 3. The Exchange Online Plan 2 licensecalculations presented in this white paper reflect the provides advanced archiving featuresstate of Office 365 in the first quarter of 2012, like legal hold.including the price reductions of approximately 20% 4. If users need more than 25Gb ofannounced in mid-March 2012. storage per user then the E3 license at $24/month is required. This will giveCLOUD vs. CLOUD -- CLEARING UP users 25Gb of storage for the primary mailbox plus unlimited storage forCOMMON MISCONCEPTIONS Personal Archives. The E3 license isTwo key myths must be dispelled in order to move also required if single item recovery isforward with helpful TCO calculations regarding needed for longer than 30 days.Exchange, SharePoint and Lync. First, and contrary 5. Use of Personal Archive or retentionto the beliefs of many decision makers, the cloud is policies requires a Microsoft Exchangenot just for small organizations. Although Microsoft Online account or Microsoft Exchangesays that 90%+ of Office 365 deployments are with Server 2010 account together withcompanies under 50 seats, and even though only Microsoft Exchange Server Enterpriseabout 5% of the total market today is using the Client Access License (CAL). This requires Exchange Online users to havecloud for Exchange, our findings clearly demonstrate an enterprise CAL on top of theirthat cloud-based offerings – whether public or standard Exchange online monthly fees.private – are less expensive than on-premisesolutions even in large organization deployments. 6. Not all Personal Archive features areSecond, when it comes to Exchange, SharePoint and available without either the Outlook 2010 or OWA client.Lync TCO, not all clouds are created equal. In spiteof the power of the Microsoft and Google marketingmachines pushing their public cloud services, private cloud offerings are typically less expensivethan public cloud offerings for delivering Microsoft email, collaboration and UC solutions at theenterprise level, as shown on the following pages.MICROSOFT EXCHANGEAs shown in the following figure, the cost of a full private cloud deployment of Exchange issignificantly less expensive than either an on-premise (13%) or public cloud (26%) deployment.The primary savings of the private cloud model comes from two areas:©2012 Osterman Research, Inc. 5
    • Cloud vs. Cloud: Comparing the TCO of Office 365 and Private Clouds• Relative to the public cloud model, private cloud savings come from the relatively low cost of the Exchange Client Access license ($67, or $1.86 per month over three years) compared to the Exchange Online price of $4.00 per month (assuming the E1 plan). Savings for the private cloud would be even more substantial if the public cloud model assumed the Exchange Online E2 plan at $8 per month or even the Office 365 E2 through E4 plans in the base configuration, which are priced at $14 to $22 per month.• Relative to the on-premise model, the private cloud is much less expensive in terms of IT labor cost per user. Our model assumes that while there will still be costs for help desk and IT support staff when using a private cloud, overall IT costs are lower for the private cloud, largely because little support must be provided by private cloud customers themselves. Moreover, in the private cloud a single operations staff member can monitor multiple customers at once, but in an on-premise environment, operations staff can monitor only a single environment.It is also important to note that the on-premise model is subject to potentially greater costincreases over time given that labor represents a larger proportion of overall TCO compared tothe private cloud model and public cloud models.Microsoft Exchange Monthly Cost per User in a 5,000-User Environment©2012 Osterman Research, Inc. 6
    • Cloud vs. Cloud: Comparing the TCO of Office 365 and Private CloudsMICROSOFT SHAREPOINTThe private cloud model for managing SharePoint offers a much lower TCO compared to theon-premise delivery model, but the private cloud is more expensive than the public cloud forboth the “required” feature set (18%) and only slightly more expensive for the required plusadditional capabilities (9%), as shown below. It is important to point out, however, that theonly functionality which pushes the private cloud model higher than SharePoint Online for theadditional capabilities is a secondary site for Disaster Recovery. Companies looking toimplement SharePoint without the extra cost of a DR site can actually do it for a 15% lowercost in a private cloud as with Office365.As with Exchange, the cost of the IT labor required to manage SharePoint varies widely basedon the delivery model, with on-premise clearly having the highest labor cost component. Thismakes the on-premise model the most susceptible to price increases over time as labor ratesincrease, and it also makes on-premise delivery highly subject to regional labor cost differences.Microsoft SharePoint Monthly Cost per User in a 5,000-User EnvironmentMICROSOFT LYNCAs shown in the following figure, the cost of delivering Microsoft Lync with private clouddelivery is slightly more expensive ($2.37/user/month or 29%) than the public cloud for the©2012 Osterman Research, Inc. 7
    • Cloud vs. Cloud: Comparing the TCO of Office 365 and Private Cloudsrequired configuration (not including voice), but substantially less expensive ($14.79 per userper month, or 39%) when additional features are added.As with the other offerings in the Microsoft stack, the cost of the on-premise delivery model isimpacted significantly by IT labor costs. For public cloud delivery of Lync, IT labor represents asmaller proportion of the TCO.It is important to note that the largest single cost for public cloud (Office 365) delivery of Lyncamong the additional enterprise grade capabilities is the provision of Lync Enterprise Voice,Microsoft’s telephony alternative. The cost of Lync Voice is an additional $28.04 which figuresout to $16.50 per month per seat more on the client side PLUS and additional $14.02 permonth per seat on the server side as shown in the Appendix of this white paper. These costsare compared to $3.00 per seat per month total (client + server) for private cloud and on-premise delivery. This significant differential in cost is due to the fact that Lync EnterpriseVoice requires an upgrade to the full E4 version of Office 365 in the Online deployment PLUSthe addition of a full on-premise Lync Server, whereas the additional cost in the private cloud issimply the amortized Plus CAL to add voice capabilities.Microsoft Lync Monthly Cost per User in a 5,000-User Environment©2012 Osterman Research, Inc. 8
    • Cloud vs. Cloud: Comparing the TCO of Office 365 and Private CloudsTCO ACROSS THE ENTIRE MICROSOFT STACKAs shown in the following figure, the entire cost of the Microsoft stack of Exchange, SharePointand Lync is substantially less expensive when delivered in a private cloud than when deliveredvia on-premise delivery or using a public cloud. Based on our cost model, private cloud deliveryof the complete Microsoft UC stack with all capabilities is 20% less expensive than the publiccloud and also 18% less expensive than on-premise delivery.Cost per User of the Entire Microsoft Stack in a 5,000-User EnvironmentAbout AzaleosAzaleos Corporation provides managed email, collaboration and unified communicationsservices available in private cloud, on-premise or mixed deployment architectures. Azaleos’ 24x7managed services for Microsoft Exchange, SharePoint, Active Directory, Lync, and BlackBerryEnterprise Server improve availability, security and performance, while reducing maintenancetime and costs.The patented AzaleosX technology platform enables customers to maintain control over serversand data including their location, while uptime, maintenance, and support is proactively handledby certified experts in its network operations centers. Hundreds of companies from Fortune 500©2012 Osterman Research, Inc. 9
    • Cloud vs. Cloud: Comparing the TCO of Office 365 and Private Cloudsto mid-market enterprises rely on Azaleos to manage their collaboration infrastructures andaddress issues before users ever know they exist.Azaleos is the largest provider of private cloud, on-premise and hybrid managed services in thecommunications and collaboration space and the go-to option for organizations who can’t find afit with Microsoft or Google public cloud solutions. A member of the National SystemsIntegrator program (NSI), Azaleos is one of Microsoft’s top 34 partners in the United States anda member of both the Microsoft Exchange and SharePoint Technology Adoption Programs Formore information visit www.azaleos.com.Appendix – Cost ModelOn the following pages are the detailed costs that comprise the model developed for this whitepaper. We have identified basic or “Required” elements – those infrastructure, labor and othercomponents that are necessary to provide the service; and enterprise grade or “Additional”elements that can provide other types of functionality.As noted earlier, for purposes of this cost analysis we compared the total cost of ownership forMicrosoft’s three primary enterprise offerings – Exchange, SharePoint and Lync – using on-premise, public cloud and private could deployment models over a 36-month lifecycle in anenvironment of 5,000 users.Keep in mind that for the purposes of our calculations we chose to evaluate each application(Exchange, SharePoint and Lync) as standalone deployments versus a combined deployment.In some cases this calculation could lead to higher costs when 2 or 3 applications are combinedsince we take away potential economies of scale in the workloads. For example by combininghardware (i.e. storage, hardware load balancer, etc.) or by not ‘double charging’ for Exchangeunified messaging in the Lync workload section (if the customer already has Exchangelicensed), there are ways to decrease costs in the model.©2012 Osterman Research, Inc. 10
    • Cloud vs. Cloud: Comparing the TCO of Office 365 and Private CloudsCost Comparison – Microsoft Exchange Required On-Premise Public Cloud Private Cloud Exchange Licensing $1.86 - $1.86 (on-premise, Standard CAL and Server) Exchange Online Plan 1 - $4.00 - Windows Server License $0.03 $0.00 $0.03 MSFT Software Assurance (Standard Licensing) $0.95 NA $0.95 Migration $0.03 $0.03 $0.03 Support: Help Desk (on customer premise) $1.75 $1.75 $1.75 Support: Infrastructure (vendor/service) $2.50 Included $1.00 Support: Infrastructure (vendor liaison) - $0.50 - Server Hardware $0.25 NA $0.25 Switching (Network and iSCSI) Hardware $0.56 NA $0.56 Storage Hardware $1.43 NA $1.43 Load Balancer Hardware $0.44 NA $0.44 Deployment $0.15 NA $0.15 Running Total $9.95 $6.28 $8.45 Additional On-Premise Public Cloud Private Cloud Exchange Licensing “Upgrade” $0.99 - $0.99 (on-premise, Enterprise CAL and Server) Exchange Online Plan 2 (Upgrade from P1) - $4.00 - MSFT Software Assurance (Enterprise Licensing) $0.59 NA $0.59 Extra Bandwidth $0.00 $1.00 $0.00 Exchange Client $1.00 $1.00 $1.00 Deployment $0.35 NA $0.35 Sub-Total $2.93 $6.00 $2.93 Running Total $12.88 $12.28 $11.38 Additional On-Premise Public Cloud Private Cloud Office 365 E3 (Upgrade from Exchange Online E2) $0.00 $12.00 $0.00 Included with Archiving (Exchange Personal Archives) $0.00 $0.00 O365 E3 Compliance $2.50 $2.50 $2.50 Filtering (AV/AS) $1.00 Included $1.00 Encryption $1.00 $1.00 $1.00 Sub-Total $4.50 $15.50 $4.50 Running Total $17.38 $27.78 $15.88 Additional On-Premise Public Cloud Private Cloud Business Continuity --- Disaster Recovery Exchange Licensing $2.85 NA $2.85 Windows Server License $0.03 $0.00 $0.03 Migration $0.03 $0.03 $0.03 HLB Hardware $0.44 $0.00 $0.44 Support: Infrastructure (vendor/service) $2.50 Included 1.00 Server Hardware $0.13 NA $0.13 Deployment $0.15 NA $0.15 Sub-Total $6.13 $0.03 $4.63 GRAND TOTAL $23.51 $27.81 $20.51©2012 Osterman Research, Inc. 11
    • Cloud vs. Cloud: Comparing the TCO of Office 365 and Private CloudsCost Comparison – Microsoft SharePoint Required – Production On-Premise Public Cloud Private Cloud SharePoint Licensing (Standard CAL and Server) $2.75 - $2.75 SharePoint Online Plan 1 - $4.00 - Software Assurance (Standard) $1.32 NA $1.32 SQL Server License $0.04 $0.00 $0.04 Windows Server License $0.03 $0.00 $0.03 Migration $0.03 $0.03 $0.03 Support: Help Desk $2.17 $2.17 $2.17 Support: Infrastructure $3.65 $0.00 $1.33 Support: Infrastructure (vendor liaison) - $0.75 - Storage: Hardware or Additional Online Costs $0.22 $0.01 $0.22 Server Hardware $0.17 $0.00 $0.17 Deployment $0.03 $0.03 $0.03 Server Cost $0.17 $0.00 $0.17 Running Total $10.58 $6.99 $8.26 Additional On-Premise Public Cloud Private Cloud Production SharePoint Licensing “Upgrade” (Enterprise CAL and $2.31 - $2.31 Server) SharePoint Online Plan 2 (Upgrade from P1) - $4.00 - Office Web Apps Upgrade - $6.00 Software Assurance (Enterprise) $1.15 NA $1.15 FAST Search License $0.12 NA $0.12 Server Hardware for FAST $0.25 NA $0.25 Internet Access (Enterprise Server) License $0.23 NA $0.23 Extranet Partner Access License NA $0.02 NA Sub-Total $4.06 $10.02 $4.06 Running Total $14.64 $17.01 $12.32 Additional On-Premise Public Cloud Private Cloud Business Continuity – Disaster Recovery Deployment $0.03 $0.00 $0.03 SharePoint License (Standard and Enterprise CAL) $5.17 - $5.17 SQL Server License $0.04 $0.00 $0.04 Windows Server License $0.04 $0.00 $0.04 Support: Infrastructure $1.83 $0.00 $0.67 High Availability $2.95 $0.00 $1.14 Storage Hardware $0.22 $0.01 $0.22 Server Hardware $0.17 $0.00 $0.17 Sub-Total $10.45 $0.01 $7.48 Running Total $25.09 $17.02 $19.80©2012 Osterman Research, Inc. 12
    • Cloud vs. Cloud: Comparing the TCO of Office 365 and Private CloudsCost Comparison – Microsoft SharePoint (concluded) Additional On-Premise Public Cloud Private Cloud Add-on Farm - Testing Deployment $0.03 $0.03 $0.03 Support: Infrastructure $1.83 $0.67 $0.67 High Availability $2.95 $1.14 $1.14 Storage Hardware $0.22 $0.22 $0.22 Server Hardware $0.17 $0.17 $0.17 SharePoint License (Standard and Enterprise CAL) $5.17 $5.17 $5.17 SQL Server License $0.04 $0.04 $0.04 Windows Server License $0.03 $0.03 $0.03 Sub-Total $10.44 $7.47 $7.47 Running Total $35.53 $24.49 $27.27Cost Comparison – Microsoft SharePoint (concluded) Additional On-Premise Public Cloud Private Cloud Add-on Farm - Development Deployment $0.03 $0.03 $0.03 Support: Infrastructure $1.83 $0.67 $0.67 High Availability $2.95 $1.14 $1.14 Storage Hardware $0.22 $0.22 $0.22 Server Hardware $0.17 $0.17 $0.17 SharePoint License (Standard and Enterprise CAL) $5.17 $5.17 $5.17 SQL Server License $0.04 $0.04 $0.04 Windows Server License $0.03 $0.03 $0.03 Sub-Total $10.44 $7.47 $7.47 GRAND TOTAL $45.97 $31.96 $34.74©2012 Osterman Research, Inc. 13
    • Cloud vs. Cloud: Comparing the TCO of Office 365 and Private CloudsCost Comparison – Microsoft Lync Required On-Premise Public Cloud Private Cloud Lync Licensing (Standard and Enterprise CAL and $3.86 $3.86 Server for IM/P and conferencing) Lync Online P2 - $5.50 - MSFT Software Assurance (Standard + Enterprise $1.93 - $1.93 Licensing) Windows Server License $0.04 $0.00 $0.04 Migration $0.03 $0.03 $0.03 Support: Help Desk $1.75 $1.75 $1.75 Support: Infrastructure 5.00 - 2.25 Support: Infrastructure (vendor liaison) - $1.00 - Server Hardware $0.20 - $0.20 Load Balancer Hardware $0.44 - $0.44 Deployment $0.15 - $0.15 Running Total $13.40 $8.28 $10.65 Additional On-Premise Public Cloud Private Cloud Lync Licensing “Upgrade” (PLUS License) $3.00 $3.00 Office365 E4 Plan (Upgrade from Lync P2) - $16.50 -- MSFT Software Assurance (PLUS Licensing) $1.47 $1.47 $1.47 Additional Lync Server On Premise Licensing for - $3.86 - Enterprise Voice Additional Licensing, Hardware, Support and - $3.83 - Deployment for On-Premise Lync Server Extra Bandwidth $1.00 $1.00 $1.00 Lync Client NA $0.85 - Included with $2.83 Office365 E4 $2.83 Voicemail (via Exchange UM) Plan Disaster Recovery $1.00 - $1.00 Deployment $0.35 - $0.35 Headset $2.00 $2.00 $2.00 Sub-Total $11.65 $29.51 $11.65 Running Total $25.05 $37.79 $22.30 Additional On-Premise Public Cloud Private Cloud Archiving $0.00 Not included $0.00 Media Gateway $0.20 - $0.20 SIP Trunk $0.50 - $0.50 Forefront Security for Lync (malware & out of policy $0.50 $0.50 $0.50 content) Sub-Total $1.20 $0.50 $1.20 GRAND TOTAL $26.25 $38.29 $23.50©2012 Osterman Research, Inc. 14
    • Cloud vs. Cloud: Comparing the TCO of Office 365 and Private Clouds© 2012 Osterman Research, Inc. All rights reserved.No part of this document may be reproduced in any form by any means, nor may it be distributed without the permission ofOsterman Research, Inc., nor may it be resold or distributed by any entity other than Osterman Research, Inc., without priorwritten authorization of Osterman Research, Inc.Osterman Research, Inc. does not provide legal advice. Nothing in this document constitutes legal advice, nor shall this documentor any software product or other offering referenced herein serve as a substitute for the reader’s compliance with any laws(including but not limited to any act, statue, regulation, rule, directive, administrative order, executive order, etc. (collectively,“Laws”)) referenced in this document. If necessary, the reader should consult with competent legal counsel regarding any Lawsreferenced herein. Osterman Research, Inc. makes no representation or warranty regarding the completeness or accuracy of theinformation contained in this document.THIS DOCUMENT IS PROVIDED “AS IS” WITHOUT WARRANTY OF ANY KIND. ALL EXPRESS OR IMPLIED REPRESENTATIONS,CONDITIONS AND WARRANTIES, INCLUDING ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULARPURPOSE, ARE DISCLAIMED, EXCEPT TO THE EXTENT THAT SUCH DISCLAIMERS ARE DETERMINED TO BE ILLEGAL.©2012 Osterman Research, Inc. 15