Outsourcing Email to the Cloud

January 18th, 2011 (Guest) Leave a comment
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Email in the Cloud

In recent months, the “cloud” buzzword has been thrown around quite often. Cloud applications, cloud storage, cloud email, cloud Sharepoint… the list seems endless, and at times it sounds as if the marketing drones in the IT world simply add “cloud” to whatever tag they can think of and try to pitch it to unsuspecting higher-ups who get dazzled by the hype and buy into the cloud.

The cloud, however, isn’t always hype. The fact of the matter is that there are occasions where it is both advantageous and cost-effective to host your services in the cloud, and in this article we’ll talk about one specifically: email. There has been much discussion bandied about in cyberspace about cloud email, and while there are good arguments on both sides, I must admit that it seems cloud-hosted email, at least for small businesses and non-profits, is an efficient, low-maintenance, and cost effective solution.

Traditional Email Hosting vs. Cloud Hosting

The very first selling point for cloud hosting is cost. Hosting email can be expensive, especially in upfront costs; let’s take a look at a very frugal setup for email hosted in-house. For this example, I am estimating costs for a small business with 25 employees, looking to host their email on-site:

Server: Dell PowerEdge T110 - $975
Email server software: Microsoft Exchange 2010 Standard - $699
Exchange Server 2010 server CALs: $1675

(Note: While there are many other email solutions available beyond Microsoft Exchange, I will use it for the example because it is extremely common in the business world.)

This is the bare minimum required to host an email server in-house, and it comes out to a whopping $3349 just to start hosting: this doesn’t even include services that are not strictly necessary, but practically necessary, such as spam filtering. This is a large amount of money to eat in one sitting, especially as a small business; hosted Exchange from Microsoft Online, on the other hand, costs $5 per user per month to keep online. The hosted Exchange functions identically to a physical solution as far as your users are concerned, and it supports integration into existing in-house systems like Active Directory. At $125 a year, that’s a pretty significant cost savings over the up-front cost of a traditional server hosted in-house.

Many small businesses are also unable or unwilling to hire a full-time system administrator to take care of their day-to-day network infrastructure; it is common for small businesses to keep just a help-desk or technical support specialist full-time, contracting out system administration work to consultants as necessary. The infrastructure necessary for a physical Exchange solution almost necessitates hiring a system administrator; if not, most certainly it will require more use of an outside consultant to install and maintain both hardware and software, raising the cost of an on-site solution considerably.

Disadvantages of Cloud Hosting

While it is true that cloud-hosted email is an attractive option, there are certainly disadvantages to it. The principal disadvantages of cloud hosting are privacy and control concerns, both stemming from the fact that it is located off-site.

The first concern for many is privacy. Mail hosted off-site naturally gives network administrators pause; email hosted elsewhere is email that can be snooped by more people. Whether it is an employee of the hosting service or someone with illegitimate access to the hosting service, many believe that email hosted elsewhere gives opportunities for espionage that may not have been available had the email been hosted on-site.

The second concern is control. Email hosted elsewhere is subject to the decision of their system administrator and not yours; software upgrades, hardware failure, infrastructure, etc. are all in the hands of someone else. Ironically, this disadvantage cuts both ways; some might say that the lack of all this control is beneficial, cutting overhead and allowing these costs to be shifted back into other parts of the company that need them the most; however, some will always feel nervous knowing their fate is entirely in the hands of someone unaffiliated with the company.

While the chances of privacy breaches or downtime outside of your control are a real concern, for most small businesses they are minor. For companies with extreme privacy requirements, such as those in the banking or health industry, these disadvantages may make cloud hosting infeasible; laws or regulations, depending on your area, may prohibit this sort of outsourcing due to the lack of privacy and control. For others, this small trade-off is more than worth the savings in manpower, cost, and overhead.


While the above example uses Exchange because of its relative ubiquity in the business world, there are certainly other alternatives to cloud hosting; Google Apps, Domino, and Zimbra servers all have hosted equivalents in the cloud as well, with Google being exclusively hosted in the cloud. Depending on the configuration of your small business, one of these other cloud hosted solutions may be right for you, especially if you are an educational institution or non-profit. Google Apps offers free cloud email for universities and registered non-profits, making them an extremely attractive and robust option for those markets.

Whatever solution you choose, however, the benefits over a physically hosted solution will be the same; Email hosting in the cloud wins out over in-house email solutions in terms of overhead and cost.

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About Boris Tulman

Boris is our resident Networking guru. He works as a Network Architect designing and implementing network technologies in ISP, e-commerce and social networking site environments. Boris holds M.S. in Software Engineering, B.S. in Computer Science and a handful of industry certifications. He teaches Networking courses at LearnComputer.