Can I replace my exchange server when I opt for a Office 365 Exchange

Hi All

I have a head office which is running a live exchange server 2003. I have about 10 LAN users using Microsoft Outlook 2003, 2007 and 2010 for emails & their OS are either Windows XP Pro or Windows 7. I also have about 25 to 30 users in other offices who connect to the exchange server via POP3 to get emails (Oulook 2003,2007 & 2010). I use Mail Marshall for Spams.

 We are planning to close down this office and move into a smaller place. My management would not want to bring along all the servers. My question is this. Can I opt for Office 365 which has a Exchange online? I am confused with the articles I read and how I should move along. If I use Office 365, I know I will get the office applications along with business class email and 50 GB storage space and sky drive etc. Does that imply I can just get rid of my active directory etc, and apply for Office 365 and create new users and email addresses there? Also will I be able to create mailing groups like how we can for exchange? My leased line required to host a exchanger server is about 1100 USD per month. Will using Office 365 be cheaper than hosting it live in the new place? Also if I opt for Office 365, will I have to upgrade all users to Windows 7?
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Red-KingIT ManagerCommented:
Firstly, you need to be sure that a cloud based service will suit your needs.
You're going to be pushing more data across your WAN link, particularly if you encourage use of things like Skydrive.

You may want to look up this comparison for your own country if you're not in the US;
You'll notice that from the Midsize Business package and up there is Active Directory integration allowing you to create users through your Active Directory infrastructure. I'm not sure how this would work for you without your own on-premise Active Directory. You will most likely need to keep a local domain controller.
You could look into hosting a domain controller with Windows Azure though:

You get greater email control on the Enterprise plans with the Exchange Admin Center.
I'm not sure if this is part of the Midsize Business package and below but is certainly part of the enterprise offerings.

You may want to review the Technet page for Exchange Online for more detailed information:

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Red-KingIT ManagerCommented:
Oh, also Office 2013 is not supported on Windows XP.
As Office365 provides you with the most up to date versions of the desktop applications you will need to upgrade your desktops to at least Windows 7.
If you are already using Office 2010 on the XP machines you may be able to point that at your Office 365 account (particularly with Outlook). I'm not sure about Skydrive integration in Office 2010 though.

Office 2013 requirements
Vasil Michev (MVP)Commented:
The price will definitely go down and it will be predictable, something that managers love. You will get almost all the features you have in your local env, actually a quite more, since you are using 2003 currently. There are tons of new collaboration features introduced in the latest version, and the users will benefit greatly from them. Mobile apps as well, they can take everything on the road.

Groups, shared mailboxes, public folders, etc, everything is included. It's best to keep the AD, you probably have some other LOB applications that rely on it. Administration is easier with it anyway, and you can integrate dirsync with password sync, so that the users are able to use the same set of credentials:

Red-king has already given you the list of requirements, support for XP ends in just few months so it's time to get rid of it.
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jimjosephAuthor Commented:

Thanks for all the detailed replies. Will this solution be more beneficial and cheaper that having our emails configured on a third party domain (Like Go daddy) and users being able to download via POP3 or Using google apps for business?

Also will converting to Office 365 affect the current users who are using POP3 and SMTP in our remote offices?
Vasil Michev (MVP)Commented:
Whether it will be cheaper for you we cannot really answer. Depends on which plans you choose, but as I mentioned previously, what managers/financial guys love about O365 is the fact that the price is predictable.

If you are comparing it to a POP3 solution, it will probably cost you more, but then again the functionality you get with O365 is beyond any comparison with POP3 solutions. Even compared to google, O365 is the clear winner feature-wise. Again, depends on what exactly your requirements are.

As for migrating/converting the users, you have a lot of options there. They can keep using POP/SMTP with a cloud mailbox, but I would really recommend switching to full Exchange.  You can even take advantage of the deskless plans, which cost less and offer only mobile/OWA/POP access:

You can even keep some of the users on the local Exchange, but that will require additional servers and setup and doesnt really fit your description. You can compare the different methods here:

You can keep your MX pointing to Mail Marshall until you have moved everything in the cloud, and then adjust it accordingly (you get first class antispam/antimalware protection included in the price of O365, so no need to use a 3rd party solution unless you have very specific needs).
jimjosephAuthor Commented:
Hi All

I am so sorry for the delay in replying as I was on sick leave and bed rest. My back had given up on me. I am online now and would like to thank you both for your detailed response.

I do have a couple of more queries though. I am planning to Opt for the Microsoft Exchange Online Plan 1 or 2. This does not include the latest version's of office right? I can as my users to continue to use Outlook (2003/2007/2010) just as how they were using only with changes made on the server settings right?

My next question is - I know I have to pay 4$ or 6$ per mailbox or email address. Does this mean, if I create a distribution list or group like will that be an additional 6$.

Also, once I migrate to Microsoft Exchange Online, will my domain name be the same? Like or will it be
Vasil Michev (MVP)Commented:
Outlook 2003 wont work with the new version of Office 365. For 2007 you need SP3, for 2010 SP1. Red-King has given you link to the requirements above.

The standalone plans do not include Office. DGs, shared mailboxes, room mailboxes, external contacts, etc are all free. You only pay for actual user mailboxes OR if you need some additional functionality (like archive or legal hold on a shared mailbox).

You can verify your domain in Office 365 and use it as accepted domain for Exchange Online, it is best to do this BEFORE you migrate to the cloud in order to preserve the primary SMTP. Same for any additional domains you have configured locally.
Jeffrey Kane - TechSoEasyPrincipal ConsultantCommented:
I suggest that you start here:

This will help you to answer all of the questions you have.

You can also just run a trial/pilot implementation to see how Office365 works for you:

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