Host own mail server or not

We currently have Exchange 2003 running on Server 2003 so both need to be replaced by mid-April. The question is do we replace the server and exchange version or let someone outside host it for us? There are 2 f/t and 2 p/t IT people here. I handle nearly all the exchange functions though my part-timers know how to add and remove users.

I can set up a VM Server 2012 and get the license, then get the 250 odd CALs for my users. That is a direct cost. The other expense is my time and effort. I did test and set up Server 2012 with Exchange 2010 some months ago, migrated a dozen or so users and it all ran well and I did not have much problem with that. Unfortunately I could not get the Powers That Be to sign off on the cost at that time. Now they must make a decision. We have people come and go about once every 2 weeks (lot of part-timers) so not much work in exchange for me.

The other option, since we are a state agency, is to pay our state IT department to host the mail server for us. Of course there is a per user cost, and the issue of mailbox size. We do not limit users directly, we just nag them when boxes start to get large. If the state hosts our mail, we will have a couple dozen users who will need to do some serious trimming.

We estimate that the per month cost will pass up the server and CALs licensing costs in less than 18 months. After that, outside hosting is more expensive. My boss likes the idea of not worrying about backups. My issue is that I am leery of letting someone else manage our mail. I know they can do backups, same as me, and they will add/remove/tweak mailboxes as needed though I do not know what kind of response time to expect. They claim it is within hours but I do not know that for sure.

Any recommendations or suggestions  on which way to go?
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I would say your decision has to be made from your boss. The main objective is if you want your data in the cloud or not. Some companies even though cloud services grantee your data will be secure and protected, do not want their data hosted off site for either regulatory or personal choice. There is cost on both sides associated but it's your data in the end and where you choose to host it. Exchange 2010 is a big change from 2003 so you will want to do some reading or training before you make the move.
Esteban BlancoPresidentCommented:
I agree with DKA Admin on this.  2010 is a beast and not even close to what you are used to.  There may be some liabilities with hosting your Exchange externally since you are a state agency and you may get Freedom of Information Act requests.  Have your boss check with legal.

Training is paramount to be able to do the upgrade to 2010 and manage it.  I have also seen from experience that it becomes a full time job.  Backups, clusters and databases for Exchange can be a challenge to manage.

If you can get a guarantee of SLA from a big company like Google for example that can guarantee not only a good uptime but also things like spam filtering and backups, then you may be better off putting it on the cloud.  Also you can ask the company to allow you access to do simple tasks like add/remove of accounts (simple management).

These are my two cents on the issue.

Good luck!
Personally, I would keep it in house.  My biggest reason - support!

We have some smaller clients we've moved to Office 365, but support is difficult at best.  You can't get access to some logs you need for troubleshooting, etc.  Support calls back hours later, again, at best, and can be difficult to work with since they appear to be in another country.

You'll run into this with most third party providers.

You mention backups.  Microsoft, for example, is probably not doing backups at all.  They use DAGs, which is how they're getting around backups (Basically your mailbox is in three different places at once, so if location 1 goes down, you're still good.)  But Microsoft is not (out of the box) providing any kind of historic backup either.  If you are required by freedom of information acts to keep data for X months or years, Microsoft doesn't do this by default.  Same with Google, etc.

If you're looking purely at cost, you're going to have to figure out how many hours it will take of your time to build out the solution and make it happen.  Ongoing support, in my opinion, is minimally more than a third party solution.

CAL and license costs are the easy ones to figure out.

Hope that helps!

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LarryDAHAuthor Commented:
Thanks for the advice. The FOI is not that important to us. We do get them but have no specific requirement to save email back to any particular date. They get what we have and that is that. I had forgotten about the Public Folders issue with 2013 and that would be a problem for us, we have a number of calendars we use. I have been pushing them to use our SharePoint calendars but inertia is making it hard. Thanks for your time.
We were heavy into public folders as well on 2003 but have migrated everthing to resources and uers have like that better. It was a bit to migrate as we just exported things to .pst and then imported the data into the new resource.
LarryDAHAuthor Commented:
Did you move the Public Folders to SharePoint? Did you go to 2013? Is that why you had to export pst files and reimport?
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