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Published 29 May 2015

Alex Innard

Alex Innard
Head of IT

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Exchange On-Premise VS Exchange Online (Office 365)

Now that Office 365 now has almost four years under its belt, it could be considered the de-facto solution for SME’s looking to replace their existing email system. Or could it?

There are many important factors to consider, especially since the introduction of Exchange 2013 a couple of years ago. Here’s a summary of some key factors to consider between staying on-premise and moving to the cloud:

With Office 365, you don’t need to worry about purchasing and managing new hardware. This reduces the total cost of ownership of your email system. 24×7 Telephone support from Microsoft is also included. You will still potentially wish to maintain your existing Active Directory server(s) and should have adequate internet connectivity in place.

If you chose Exchange on-premise, you will need to deploy and maintain the Exchange software (including Client Access Licences) and server hardware. Improvements in its disk usage mean that the latest version of Exchange will perform perfectly well on the more cost effective SATA hard disks. Previous Exchange versions relied heavily on faster, more expensive hard disks.

High Availability:
High availability is built into Office 365 as standard. This is financially backed by a 99.9% SLA.

Exchange 2013 on-premise has an improved DAG (database availability group) system, with simplified configuration that enables multiple Exchange servers to host copies of your Exchange database. Coupled with improvements in CAS (client access) load balancing, this offers a good HA solution to fulfil the more demanding disaster recovery goals.

Office 365 offers mailboxes with a maximum capacity of 50 GB each.

With Exchange on-premise, mailbox quotas are configurable to meet your business needs, and are limited only by the capacity of the server’s hard disk storage. Additionally, you can deploy Address Book Policies to refine the view of the Global Address List to subsets of users within your organisation.

Third Party Applications:
Office 365 is not compatible with some legacy applications, protocols or third party mail-enabled programs. Your business may need to upgrade these, or retire them before moving to Office 365.

Exchange on-premise offers slightly more flexibility in order to integrate with third party applications, which is all controllable on-site. This includes the ability to create custom send and receive connectors, and install third party software alongside Exchange on-premise in the same server environment.

Anti-Spam/Anti Malware:
With Office 365 your business can leverage the power of Exchange Online Protection for minimal extra cost per user. This provides effective inbound and outbound spam / malware filtering, reporting and message tracking as three of its main features.

Exchange on-premise ships with very basic anti-spam capabilities, however in reality these are nowhere near as effective as a paid-for solution. You can couple Exchange Online Protection (or a third party filtering product such as GFI MailEssentials) with on-premise Exchange, to achieve the best result.

Hold That Thought

At this stage, it’s worth mentioning that the argument for on-premise vs online Exchange is not necessarily valid. Whilst you can opt for an “either/or” solution, there is another contender.

You can chose to have a hybrid deployment, making use of a mixture of cloud and on-premise mailboxes in one centrally manageable environment. This can provide your business the flexibility to have the “cloud on your terms.”

For instance; you can opt to have your head office employees leverage the power of on-premise Exchange, providing a ROI for your hardware investment, and field based employees hosted on Office 365, providing a great “go anywhere” service. Both types of user will still be manageable from one central control panel. They will both still seamlessly experience sharing calendars, scheduling meetings and sending email communication to one another.

With these hybrid capabilities you can migrate over time to help meet your scheduling and business requirements, or maintain a hybrid Exchange environment for a longer term.

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