Hosted email: it's a buyer’s market

With hosted email steadily becoming the defacto way in which email is delivered to organisations, the market has become saturated with varying providers that offer sliding scales of technology, service and pricing.

Traditionally the hosted email market was the preserve of service providers who partnered with vendors to deliver their service. Increasingly, the growth in the market has seen vendors choose to enter the market directly. The likes of Google, Microsoft, IBM, Cisco and VMware all have direct market offerings.

Such strong vendor presence means that it has become a buyer’s market. Google and Microsoft are increasingly turning what was a cold war into a hot war competing aggressively for small and enterprise business. This has also meant that the traditional service provider market is trying to adapt its commercial model to ensure they are competitive with the market's big beasts.

However, there are number of things that mean that vendors don’t necessarily understand the requirements of the mass of businesses that sit in-between the very small and the very large. Put simply the mid-market is poorly served by vendors. Their inability to focus on migration and service means mid-market customers are left to figure out how they can shoehorn this vendor platform into their business.

Managed service providers such as Claranet have a heritage in hosted email services. Not to turn this into a sales pitch but we have been delivering hosted email services for nearly 20 years, with the last 10 of that being hosted Exchange. Our focus on the mid-market means that platform is important, but not as important as migration and the service and support wrapper that we add to our service. From a commercial perspective I know as a product manager that we can’t commercially compete with Microsoft or Google, so why bother. We ensure that we have the right service levels, the single service desk, a commercially backed SLA, migration plans and services and the security that ensures our customers email data is housed only in the UK.

As credible alternative to Office365 Claranet can remove the pain and hassle from choosing hosted email services. Making email decisions based solely on price is a mistake a lot of organisations make.

There are many other factors that should be considered in the decision-making process, such as:

Risk vs. Reward: One of the benefits of a close economic comparison of on-site versus hosted email services is the ability to determine risk. If an organization concludes that cloud email is £3 pupm less expensive than on-site email, it then has a rather simple way to examine risk. So the question might be: is saving £180,000 per year (£3 pupm x 12 month x 5,000 users) worth the risk of going to a relatively new platform or going to a vendor that generates less than 2% of revenue from enterprise sales?

Customisation and Integration: what other applications and processes do you need to integrate into your email environment? Telephony, CRM, faxing, workflow management applications and many more spring to mind.

Functionality: Many cloud platforms may lack the important functionality available with an on-premises system. Exchange services provided by Microsoft Office 365, for example, do not support public folders or Outlook online mode. We understood that mid-market customer still employ public folders, it’s built into our services as standard.

Opportunity Cost: Claranet’s customers tell me that when they migrate to hosted services it allows them to free up in house resources and skills. Engineering resource can be re-purposed adding more value to your organisation. This should not be overlooked.

So, in summary, the future of email is in hosted environments. Just ensure you are making your provider decision for the right reasons, and not just because of price.