Feb 8, 2008

E-mail is getting cheaper

I am struck by the price points that enterprise e-mail are coming to. Just goes to show you how a consumer-based SaaS solution getting into the enterprise market can drive the prices down.

Now any business, regardless if they subscribe to Google Apps, can take advantage of these powerful features. How much does it cost though? It’s a lot cheaper than the equivalent Microsoft service. For the most basic package (simple message filtering), Microsoft is charging $21/user/year. Google’s equivalent package is $3/user/year. The most expensive package from Microsoft (that includes only 3.6GB/user archiving) costs $103/user/year, and only $25 from Google.

Of course it's easy for a vendor like Google (who has been giving away consumer e-mail for a long time now) to force the price issue and differentiate itself from the hosted enterprise solutions. Although price drops for delivering e-mail to the enterprise are drivers for choosing an e-mail platform, at the end of the day CIOs are concerned about much more than the price of e-mail. Despite predictions that e-mail is dead it's still one of the most mission critical applications in the enterprise and there are many considerations that CIOs face when deploying e-mail systems. Security, compliance, back-up and recovery, system integrity, anti-virus/spam, and (most importantly) user happiness with the e-mail client and support. These are areas where hosted enterprise systems - such as Hosted Exchange with Outlook or Outlook Web Access - differentiate themselves from consumer-based tools. Here's a sad Tech News World story on what can happen with hosted e-mail: Using Email as Storage: A Cautionary Tale

Still having Google push the price issue is good news for enterprises. It forces the competition's hand, specifically when it comes to Microsoft. ISPs (such as 01, Mindcentric, or Perceiva) who offer more enterprise focused Zimbra-based e-mail and collaboration tools are already competing at price points comparable with Google's. While Google may have the media mind share, there are comparably priced alternatives available that offer enterprise-friendly options on the market today. Organizations need to keep this in mind as they consider a jump to another e-mail platform.

The largest hurdle Google needs to mount is the perception that Google is a consumer company that sells on-line advertising and should not be entrusted with important corporate information. It's good to see that Google is leveraging it's Postini assets in this case. Postini addresses many of these concerns very well - including a good reputation with hosted enterprise e-mail management and security tools that are SAS 70 Type II complaint ensuring data center activity logging and auditability. Technologically Google still needs to add more enterprise-like functionality to it's interfaces and continue to integrate with common desktop applications that information workers deal with every day in order to really catch enterprise business.

» Google launches new service for enterprise email | Googling Google | ZDNet.com

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