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Help with phased migration to SBS 2011 Premium from Server 2003 Enterprise with SQL 2000

We've not really worked with SBS 2011 at all yet, but we have a customer that may greatly benefit from it so I'm looking for some verification regarding a phased migration. Here's our situation and what I'm hoping to do:

Their current server is a dual Xeon X5560 on an S5520HC motherboard with 6GB (6x1GB) memory, RAID 10, management, etc. It runs well, but using Server 2003 Enterprise 32bit and SQL Server 2000 Enterprise. The server is configured as the DC and there are 32 users.

At the moment, upgrading the existing server is not an option, as the program that it is hosting the database for is about 4 years behind on updates so it needs a lot of patching before it can be moved to a newer OS & SQL. Meanwhile, the need for Exchange has arisen and knowing that they do eventually want to upgrade the SQL server, and knowing that adding Exchange to the existing system would not be wise, it looks like SBS 2011 Premium may be a good route to go.

What I would like to do is this:

1) Get a second (smaller, but sufficient) server to act as the DC, and host Exchange using SBS 2011 Standard (x64).
   - Can we simply demote the 2003 Enterprise Server and join it to the SBS 2011 domain for now?
   - Most of the computers on the network are running Windows XP, and many are using Office XP (with a couple using Office 2000). Will we have problems with Exchange?

2) At some point this summer we will apply all of the updates to their software, and then purchase the SBS 2011 Premium add-on and upgrade the system that's in place now (along with adding 6 additional 1GB chips for a total of 12GB memory).
    - Do you see any issues with Server 2008 R2 Standard for the database server with 32 users, 2 physical processors, and 12GB memory?
    - There are approximately 6 to 8 active databases at most totaling less than 200GB - do you see any issues with the SQL Server 2008 Standard that's packaged with SBS 2011?

A couple of the questions may be givens, but I just want to verify this plan before proposing it since SBS 2011 is so new. I appreciate any advice.

Thanks in advance!
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CompTechNSAuthor Commented:
In case anyone asks, the reason we are not doing the software update yet is due to how complicated the process is:

1) Remove the client software from all but one workstation
2) Apply updates one at a time to the server
    - After each update, the one remaining workstation will be updated and the software opened to allow it to apply the update to the database
3) After all updates are installed, reinstall the latest version of the client software on the workstations

Needless to say, we will be doing this over a weekend, and it will have to be a number of weeks down the road due to scheduling. Meanwhile, they need the Exchange Server functionality sooner if possible...
Cliff GaliherCommented:
You won't need to demote the 2003 server. Just introduce the 2011 server in a migration scenario and let it add itself as a DC and transfer FSMO roles. Both servers can co-exist as DCs temporarily (or permanently) and will save some headaches.

Once you have SBS propped up, you can choose to demote the 2003 server or not based on your DR needs and other factors.

Plan on upgrading to Outlook 2003 or later.

As far as the rest, only you know the metrics of your database usage, but at first glance, I don't see a problem with what you've outlined. Test labbing the system and then extrapolating database usage wouldn't be a bad idea though to make sure you aren't resource constrained.

CompTechNSAuthor Commented:

Since closing this question I've come across two additional questions I'm hoping you can help with.

1) All of the documentation I'm finding on the SBS 2011 migration install is for migration from SBS 2003. Is there anything I need to know or do when migrating from Server 2003 Enterprise (non-SBS)?

2) Can the migration install be done while the existing server operates, or will the installation of & migration into SBS 2011 interrupt the network (meaning it can't be done during normal business hours)?

Thanks for your help!
CompTechNSAuthor Commented:

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