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Thread: Yahoo selling Zimbra news?

  1. #41
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    Quote Originally Posted by Mike Scholes View Post
    I look after companies that have as low as 5 users yet still need collaboration requirements. Would be nice to have something to sell them other than Exchange
    IMHO it's the rare company with < 25 mailboxes that truly needs a premises-based email/groupware solution. And the costs are much higher than a hosted solution too.

    Mike, have you considered becoming a Zimbra Hosting Provider?

    We initially chose Zimbra for our own internal use, but two smaller clients facing Exchange upgrades saw us using it and wanted a demo. They decided they wanted Zimbra instead of Exchange, we ran the numbers and it was better for everyone if we became a Hosting Provider. So we did.

    We have plenty of clients for whom Exchange is more appropriate than Zimbra (usually due to third-party app integration with Exchange), but becoming a Zimbra Hosting Provider might help you better serve your smaller clients.

    Hope that helps,
    Mark

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    Quote Originally Posted by LMStone View Post
    IMHO it's the rare company with < 25 mailboxes that truly needs a premises-based email/groupware solution. And the costs are much higher than a hosted solution too.
    Fully agreed...

    It's just a question of adding figures :
    . cost of dedicated server or VM
    . cost of _real_ backup infrastructure
    . cost of ZCS licences
    . cost of sysadmin time to manage the server & ZCS (training needed ?) or contractant to do it in a serious way

    And if hosted onsite :
    . cost of _real_ hosting for the server or VM (dual PSU, dual UPS, locked room, etc)
    . cost of _real_ "connect me to the internet" infrastructure with _real_ "always on the internet" relays/spools

    I bet even if the software was free for 5 users (NE + Zimbra Mobile), going through an HSP would be (way) cheaper.

  3. #43
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    Quote Originally Posted by LMStone View Post
    Mike,

    Full Disclosure: We are a Zimbra Hosting Partner serving companies with global operations. Zimbra is part of our suite of managed services provider offerings. We also support a number of SBS servers at some of our smaller clients and full-blown Exchange servers at some of our larger managed services clients.

    In our experience, it is the very rare client with less than 25 employees who should be running their own premises-based email/groupware solution in the first instance. A hosted email solution of any stripe (Zimbra, Exchange, GMail, etc.) will in almost all cases be less expensive and have higher availabilities than a small premises-based solution.

    Sure, SBS 2008 is a darn good product (we really love the daily emailed reports!), but just because you get Exchange "for free" with SBS doesn't mean you should use it.

    In the first instance, running Exchange increases the server hardware requirements, which adds cost. Second, to ensure email can actually arrive at the SBS box 24 x 7 x 365 the client needs to have good power and Internet connectivity, which also adds capital expense and recurring costs.

    And, as much improved as Exchange 2007/2010 are over previous versions, Exchange itself still requires attention and maintenance, again, adding costs.

    We therefore see very much eye-to-eye with Zimbra that companies requiring less than 25 licenses should deal with a Zimbra Hosting Provider in most cases. And if email is so critical to a smaller company, or they have unusual requirements that a premises-based solution is indeed required, then the extra cost from having to buy the minimal number of Zimbra licenses will be but a fractional percentage of the total premises-based email system costs.

    It's also I think worth considering that Zimbra -- as great a tool set as it truly is -- isn't for everyone. It's dangerous to fall in love with your tools...

    We often tell clients that it's hard to pull out old nails using a ball peen hammer, so as good a hammer as you may have, it can't do everything other hammers can do.

    Our strategy with clients is to get everyone to agree to "What's the job? What's the strategy?" and then if Zimbra is the right tool for the job, great. But if not, that's OK too (there are other tools we can use).

    Hope that helps,
    Mark
    I have to disagree with the above comments, they clearly come from a company selling hosting services. The benefits of running your own email/groupware server are numerous. High availability isn't achieved by hanging all your services on the end of your broadband connection. My clients have had a lot more internet downtime than server downtime. Broadband is already in place for Internet and external email pickup, the router is already in place, your domain costs about £8 for 2 years including DNS control and a static IP costs me £5 a month. The additional costs are minimal. I use a dual core Dell server with 2BG of RAM and a it flys with Zimbra, It cost me £160 from Dell brand new. Gone are the days where servers costs thousands, remember we are talking about small companies, 5-10 users.

    One company I service rejects between 10,000 to 20,000 emails per day. These are mostly emails sent to unknown addresses from spoofed addresses, we are all familiar with this. Using pop3 in this instance would be a joke. It means all these email have to be downloaded in full, analysed and then a reject email sent in full back to spoofed address and then bounce back. Having smtp time scanning of viruses and spam significantly reduces your bandwidth use and therefore increase efficiency and reduce costs. If your email is stored locally it's so much faster. I don't want the frustrating delay in browsing online services. I don't want to be sending emails with large attachments out to the internet and then back in again just to reach the guy sat opposite. I want to upgrade when I want to, not the hosting company. I don't want the hosting company going bust leaving me in the lurch, shall I go on? I can.

    Your say "if email is so critical to a smaller company". I really don't understand this comment, every individual I know considers email as critical, never mind companies. None of my customers would consider not having email regardless of size.

    I have to look after 2 legal firms, one of 50 users, one of 6 users yet what they need from their IT is exactly the same. They need remote access to email, shared address book, shared calenders etc. It isn't the number of users that dictates this. It would be a mistake to suggest you only need to collaborate when you have 25 users and above.

    Going back to Zimbra license numbers, look at other products. Sage Accounts 1, user, 2 users, 5 users no problem. Act 5 user, yes. Norton 5 user, yes. Just type in "5 user" into any online software reseller and see the number of results. So why do all these companies offer 5 user licenses?

    Back to SBS, most of us on this forum don't like MS very much but one thing no one can deny is that they are a very good marketing company. So why do they offer a 5 user SBS product? Because there is demand for it. You get your product into a small company, chances are they will grow with it. MS aren't stupid when it comes to selling their products.

    Now if my tyres wear out on my car I go and buy 4 four more, I don't go and buy 25 tyres, especially when the extra 21 I don't need are going to magically disappear in 12 months! I buy what I need. That's what my customers do and I agree. Zimbra the "Exchange Killer"? Not to the small company is isn't. Start appealing to the small company and make your 50 million mailboxes seem like a rather small number.

  4. #44
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    Quote Originally Posted by Klug View Post
    Fully agreed...

    It's just a question of adding figures :
    . cost of dedicated server or VM
    . cost of _real_ backup infrastructure
    . cost of ZCS licences
    . cost of sysadmin time to manage the server & ZCS (training needed ?) or contractant to do it in a serious way

    And if hosted onsite :
    . cost of _real_ hosting for the server or VM (dual PSU, dual UPS, locked room, etc)
    . cost of _real_ "connect me to the internet" infrastructure with _real_ "always on the internet" relays/spools

    I bet even if the software was free for 5 users (NE + Zimbra Mobile), going through an HSP would be (way) cheaper.
    "Dual PSU, Dual UPS, locked room, relay/spools"? Small companies, just 5 users, come on.

  5. #45
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    Quote Originally Posted by Mike Scholes View Post
    I have to disagree with the above comments, they clearly come from a company selling hosting services. The benefits of running your own email/groupware server are numerous.
    Hi Mike,

    Sorry if I wasn't clear; I agree there are a number of smaller companies for whom premises-based email is appropriate. Small law firms emailing scanned documents and marketing services companies and ad agencies emailing large media files are good examples where a premises-based solution might make more sense.

    On the mercenary side, we make much more money from supporting premises-based email systems for smaller companies than we do from selling them Zimbra hosting services. Further, our Zimbra hosting revenues are only a fraction of our total revenues, so if Zimbra went away tomorrow we would still be able to put food on the table.

    But since our role is to be our clients' acting CIOs, it's hard for us to recommend (except where appropriate) that a client pony up for a more expensive premises-based email system.

    I do take issue with your cost calculations however. In the first instance there is a cost to a company associated with downtime and availability. The power, cooling and Internet connectivity at a company's office will never be as reliable as that of a data center. Neither will a single server solution when the hardware fails -- and let's at least be realistic that a 300-quid server will have more downtime than a server with redundant fans, power, disks, DIMMs, etc. Regardless of the size of the company, if email is really critical to the company, then any downtime will be very, very expensive. Suppose one of your legal firms can't file a motion by the deadline because their Internet was down or a Zimbra upgrade went awry?

    In the second instance, there is a cost to the company for your services to maintain the server. I don't see that you included your maintenance and monitoring revenues there in the cost of the premises based email system.

    Lastly, for plenty of companies email is a luxury, not a necessity. We have a number of clients whose primary means of communication comprises using a sophisticated, industry-specific vertical application, the telephone, texting (for field service personnel) and faxes. Email is used by central office staff, but since most of those staff are sitting right next to each other they prefer to walk down the hall to have a face-to-face conversation.

    I don't want to speak for Zimbra corporate, but to our eyes Zimbra appear to have made a strategic decision that smaller accounts are to be served by hosting providers and larger accounts can choose between hosting providers or their own system. We think that represents the most cost-effective solution for most (again, not all) companies who are appropriate target Zimbra customers.

    There are always exceptions to every rule, and your two law firms seem to fall into that category. We have clients like that too. But to accuse us of being somehow disingenuous in agreeing with this approach just because we are a hosting provider, when we make more money from premises-based email and when Zimbra hosting revenues are only a fraction of our total, seems at best unjustified, if not perhaps a bit fatuous.

    At the end of the day, I don't think we disagree as much as your post might suggest: as I said initially there are of course smaller clients for whom a premises-based email solution is totally appropriate.

    Hope that clarifies things a bit.

    With best regards,
    Mark

  6. #46
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    Quote Originally Posted by Mike Scholes View Post
    "Dual PSU, Dual UPS, locked room, relay/spools"? Small companies, just 5 users, come on.
    Come on, 5 users company not able to get a dual PSU server do not need collaboration tool 8)

    I however agree about the "broadband" issue...

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    Quote Originally Posted by Klug View Post
    I however agree about the "broadband" issue...
    Hopefully as more ISPs start to deliver bonded connections then that should help matters somewhat.

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    Quote Originally Posted by Klug View Post
    Fully agreed...

    It's just a question of adding figures :
    . cost of dedicated server or VM
    . cost of _real_ backup infrastructure
    . cost of ZCS licences
    . cost of sysadmin time to manage the server & ZCS (training needed ?) or contractant to do it in a serious way

    And if hosted onsite :
    . cost of _real_ hosting for the server or VM (dual PSU, dual UPS, locked room, etc)
    . cost of _real_ "connect me to the internet" infrastructure with _real_ "always on the internet" relays/spools

    I bet even if the software was free for 5 users (NE + Zimbra Mobile), going through an HSP would be (way) cheaper.
    With all due respect, Klug, NO.

    I have hosted ZCS FOSS on a small business network that has ranged from 15-30 users depending on the economy & employment, for nearly three years (I think) now, and the sucker has been so close to maintenance-free to be laughable. Recently I moved my fulltime employment to an Exchange-using company, and I can tell you without reservation that it's been an unmitigated headache.

    Self-hosted ZCS is a very real, very useful application for the SMB. If we could get a more-affordable solution for NE we probably would've gone there, but the reality is the annual cost killed that option, just as OP has been saying. But there is no way that going with a ZCS hosting provider would have been cheaper than the FOSS solution we've been using. . .and I was NOT a Linux expert when I started, I learned it all from you guys on this forum (plus extra TLC from Mike Morse ).

    So I think you guys' cost comparisons are off. . .
    Cheers,

    Dan

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    Quote Originally Posted by LMStone View Post
    I do take issue with your cost calculations however. In the first instance there is a cost to a company associated with downtime and availability. The power, cooling and Internet connectivity at a company's office will never be as reliable as that of a data center. Neither will a single server solution when the hardware fails -- and let's at least be realistic that a 300-quid server will have more downtime than a server with redundant fans, power, disks, DIMMs, etc. Regardless of the size of the company, if email is really critical to the company, then any downtime will be very, very expensive. Suppose one of your legal firms can't file a motion by the deadline because their Internet was down or a Zimbra upgrade went awry?
    Again, Mark, you're selling the SMB short I think. I have two different companies running ZCS FOSS--one on surplus IBM x330s that I bought (five at a time) for about $150 each--I have closet-redundancy there for very little money, and the sucker keeps on ticking. My other client runs it on a black-box machine he got from his local computer reseller. Both cheap, both low-power, both running without a hitch for years.

    Sure, crashes happen. But quite frankly, I've seen more outages from some large-company services (RIM, anyone?) in the past five years than I've seen with my own on-the-cheap in-house servers.

    In other words, I think you --and Zimbra-- are selling the SMB a bit short as to what they can do, and what their realistic budget numbers are. There are a lot more of us doing a lot more with a lot less than you appear to believe, and doing it successfully! The right ZCS SMB license (per-user Outlook connector, per-user Mobile, without all the other NE benefits) would be another revenue stream for Zimbra that they now are leaving entirely on the table. A la carte pricing of some of these features could open a whole new market, and I believe it'd be far bigger than Zimbra folks think. . .

    'Course I've sung this same song for an awfully long time now, so I'm not sure why I bother singing it again. . .
    Cheers,

    Dan

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    Quote Originally Posted by dwmtractor View Post
    Again, Mark, you're selling the SMB short I think. I have two different companies running ZCS FOSS--one on surplus IBM x330s that I bought (five at a time) for about $150 each--I have closet-redundancy there for very little money, and the sucker keeps on ticking. My other client runs it on a black-box machine he got from his local computer reseller. Both cheap, both low-power, both running without a hitch for years.

    Sure, crashes happen. But quite frankly, I've seen more outages from some large-company services (RIM, anyone?) in the past five years than I've seen with my own on-the-cheap in-house servers.

    In other words, I think you --and Zimbra-- are selling the SMB a bit short as to what they can do, and what their realistic budget numbers are. There are a lot more of us doing a lot more with a lot less than you appear to believe, and doing it successfully! The right ZCS SMB license (per-user Outlook connector, per-user Mobile, without all the other NE benefits) would be another revenue stream for Zimbra that they now are leaving entirely on the table. A la carte pricing of some of these features could open a whole new market, and I believe it'd be far bigger than Zimbra folks think. . .

    'Course I've sung this same song for an awfully long time now, so I'm not sure why I bother singing it again. . .
    Hi Dan,

    This is a great thread for a whole host of reasons (no pun intended...)

    Zimbra's licensing strategy is what it is. I don't think you can be all things to all people, and (hosting provider hat on), if Zimbra started selling 5-license NE bundles, we'd welcome that because like I said above, we make more money supporting a premises-based server for a small company than we do providing them Zimbra mailboxes on our hosted infrastructure. But our experience has been that few companies of that size are better off self-hosting their mission-critical email.

    We are also big fans of used equipment too. The IBM x330s are nice, and so are off-lease DL-360 G4/5. For a small enterprise, buying two of those used boxes will cost less than buying a single new current-generation box, and will result in less downtime too when the production fails. (Just take the drives out of the old chassis, pop them in the new chassis, boot it, update the NIC settings to account for MAC address changes and you are good to go.)

    But again, just because you can do something easily and (apparently) inexpensively doesn't always mean you should!

    Above all, we have seen too many small companies grossly underestimate the true costs of self-hosting, of which the cost for the gear is often just a small percentage. The other costs to consider are the costs for downtime, (which comprise not only lost revenues but unhappy customers, suppliers and employees, with all of the concomitant ripple effects therefrom); maintenance, monitoring, backups, D/R and hosting (i.e. ISP and related costs).

    For many of our clients whose business relies on having a reliable connection to the Internet, we are now recommending they have carrier-diverse redundant connectivity in the form of, for example, both a cable modem and a DSL connection. Decent DSL in many cases costs under $100/month, and the incremental cost for a firewall/router/UTM device that can do automated failover/load balancing between the two connections is often less than $150.

    All of these trends make the entry costs for self-hosting much lower it is true, but before you jump into the deep end of the pool we think you should be careful to estimate accurately the full costs of that jump.

    With best regards,
    Mark

    P.S., Just curious what the D/R plan is for your two clients... What happens if their offices burn down? How quickly can you get a working email system back up and running for them with all of their email restored? Or do they accept that they don't need that capability? And if they don't, then email isn't really critical for them - and using a self-hosted FOSS deployment is perfectly fine for a client like that. Not trying to take a poke here, just pointing out that Mike and I were talking about clients for whom email is very mission critical. Different rules apply in those cases I think it is fair to say, yes?

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