Private Cloud Cheaper than Public Cloud for Microsoft Apps

Azaleos Corp., the managed services provider that specializes in implementing Microsoft applications, has released an independent report in tandem with Osterman Research that details the cost of implementing Microsoft messaging and collaboration systems in both public and private cloud environments. The result? Azaleos and Osterman have found that private environments are a more cost-effective choice.

The report, entitled Cloud vs Cloud: Comparing the TCO of Office 365 and Private Clouds, found that implementing messaging and collaboration tools in a private cloud environment is 1 percent cheaper than on-premise deployments and 20 percent cheaper than Microsoft Office 365, on average. The report identifies "Microsoft collaboration tools" as deploying Exchange, SharePoint and/or Lync.

It's important to note that the above findings are only true for enterprise configurations of the Microsoft Unified Communications (UC) stack of applications. The opposite becomes true for basic configurations of the same tools. In a basic configuration situation, the study found that it's actually 21 percent cheaper to deploy the applications in a public cloud than a private cloud, and 36 percent cheaper to deploy the applications in a public cloud than on-premise. Translation? It's never a good idea, from a cost-effeciency perspective, to deploy Microsoft collaboration tools on-premise.

According to Osterman Research President Michael Osterman, the study shows to main reasons why the private cloud delivery model is less expensive than the public cloud when delivering and managing enterprise-class services using the Microsoft UC stack:

  1. Public cloud services are more expensive than all of the hardware, software and extra infrastructure costs of a private cloud environment, combined.
  2. Enterprise features are more expensive in a public cloud environment than a private cloud environment.
"When deploying an enterprise scale system, some of the additional features like adding voice functions to Lync or extra bandwidth in an Exchange environment are much more expensive in the public cloud than in a private cloud scenario,” Osterman said in a prepared statement.

The findings of the report are no surprise to Azaleos. The MSP has been steadily building new solutions to persuade its enterprise customers to use private clouds. And for those who are already doing so, Azaleos is trying to help them maximize their private environments. The MSPs latest move to that end? An expansion of its managed SharePoint services within private cloud environments in February, 2012.
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