Should I Use Office 365 or Hosted Exchange for My Business?

Joan PabonAug 16, 2017

Hosted Exchange is an email and calendaring solution for businesses powered by Microsoft Exchange. If you have ever worked in a corporate office environment, there’s a good chance your company used or is currently using a Microsoft-based server that provides email transfer and calendaring functionality between multiple clients and network devices.

Hosted Exchange: How It Works

In the past, businesses had to cover the cost of buying, installing, maintaining, and supporting an in-house server in order to deploy Microsoft Exchange. These days, hosted services afford a new approach to software deployment, allowing businesses to “rent” and remotely access vital systems and functions from a web hosting provider that shoulders the cost of installing, updating, and supporting the server on their premises. Exchange hosting is based on the same principle, where a vendor or service provider manages access to a Microsoft-based mail server for multiple clients and charges them per use. In short, cloud computing has revolutionized email solutions for businesses who need a robust electronic mailing system by making the service accessible, cost effective, and equipping it with other practical features such as automatic synchronization of emails, calendars, contacts, and tasks.

When Hosted Exchange Makes Sense

Hosted Exchange makes perfect sense for sizable businesses with 50 or more employees that don’t have the budget or space required for an on-site server. Currently, email is one of the most essential tools any business can have, yet, for the great majority, purchasing and maintaining a server to obtain such a basic and necessary service may not be a sensible investment. As a result, more businesses in need of high-capacity email and calendaring services are turning to hosted Exchange to circumvent the inconvenience and potentially high cost of purchasing hardware and software that has to be continuously managed and updated. In addition to lowering overall costs and providing a convenient internet-based email solution, hosting offers advantages such as:

Having a centralized email service with excellent collaborative features like automated email and calendar syncing across multiple platforms, and compatibility with Microsoft Office products and other communication tools such as Skype for Business.

Increased productivity and returns, as businesses who switch to a hosted mail service can increase uptime by 99% and save big by minimizing unavailability.

Greater security by having email data stored and backed up in a secure data center, as well as getting additional features like spam, virus, and encryption protection.

Better protection against downtime and data loss during email data migration by having IT experts take care of the process from start to finish.

Having failover solutions with hardware and software redundancy and the ability to add servers as the needs of your business increase.

What Is Office 365?

Office 365 is a line of subscription plans developed by Microsoft Corporation which allow clients to access their applications, services, and productivity software over the cloud. Office 365 for businesses includes Skype for Business, SharePoint, Exchange Online email hosting, Office Online, and additional online storage with OneDrive. Some plans also include the most recent Office applications such as Word, Excel, OneNote, Publisher, etc., that can be installed on multiple devices at the same time. The offer does have some licensing limitations, however. Office 365 Business, Business Essentials, and Business Premium plans have a 300-user limit, while their Enterprise plans provide unlimited access. Another great feature of the Office 365 suite is the rolling updates that automatically upgrade the suite of products to the latest version available, now on a quarterly basis as opposed to their previous three-year release schedule.


Is Office 365 Right for My Business?

Office 365 can be an excellent choice for businesses looking for a stable email solution with a wealth of additional features in a single, solid platform. Being a Microsoft product, Office 365 provides the best communication, collaboration, and productivity tools with document management, web conferencing, cloud storage services, access to web-based applications and traditional software, and free continuous updates and support. There are three different Office 365 Business packages, all offering applications and cloud file storage and sharing. Out of the three plans, the Business Premium option affords the most comprehensive range of services, including:

• 50 GB of mailbox storage

• Desktop versions of their Office 2016 apps

• Desktop versions of Outlook, Word, Excel, PowerPoint, OneNote, and Publisher

• One terabyte of OneDrive storage

• Unlimited HD video conferencing

• 24/7 support online or over the phone

• Other applications such as Yammer, Microsoft Teams, and Microsoft Bookings

• One license covers five devices of each type—PC, Mac, tablet, and smartphone—for each user

There are two billing options available for all plans, a monthly commitment payment that can be canceled anytime, and an annual commitment payment that cannot be canceled until the end of the term but can be purchased at a discounted price. There are also discounts available for businesses who want to obtain a volume of 250 licenses or more. Office 365 packages are flexible and customizable, which means you get to upgrade to a different plan or select the combination of plans that better suit your business needs.

Hosted Exchange vs. Office 365

Both Exchange and Office 365 are Microsoft products that share a similar purpose and common features. So, what is the main difference between the two? Essentially, Exchange hosting services are supplied by third-party vendors who rent an off-site server to deploy the software for a number of different clients over the internet. Office 365 is also a cloud-based service, yet one that can be purchased directly from the software’s developer, Microsoft Corporation. Office 365’s complete platform delivers a seamless experience that includes several features not currently available from other hosts, such as Lync Online, free BlackBerry support, web-based and traditional Outlook, download rights to all or most MS Office applications, and auto-expanding archiving features that allow unlimited mailbox storage space. Office 365 is also ahead of the competition in terms of security, as they comply with ISO standards for information asset safety and monitor their services to maintain their FedRAMP Authorization to Operate (ATO). The advantages of purchasing a subscription from a hosted provider are having the ability handpick the Office solutions and features you want, as well as getting personalized service from a vendor you can contact directly. Nevertheless, Office 365 remains a more secure and inexpensive solution for businesses of every size.

How to Pick the Best Hosted Exchange Provider

If cost is no object to you or your business and personalizing your services is among your main priorities, there are countless hosted email solutions for you to choose from. Before selecting an Exchange provider, assess your business goals and requirements. Here are some considerations to keep in mind:

ActiveSync: Exchange ActiveSync is a protocol that allows mobile devices to synchronize data such as email, contacts, calendars, and tasks with Exchange mailboxes. Since ActiveSync is owned by Microsoft Corporation, hosted providers may offer a similar solution.

Mailbox Size: Make sure your plan allows you sufficient mailbox storage space. Most Exchange providers offer 25GB, and some even include additional cloud storage at no extra cost.

Uptime Guarantee: If time is money for your business, system failures can cost you. Providers offering a 99-100% uptime guarantee will refund you for any downtime due to server unavailability.

Multiple Servers: Given that a 0.1% downtime can mean up to 8 hours of outage a year, further reduce downtime by choosing a vendor with multiple servers in different locations.

Security & Protection: If your business deals with sensitive information, make sure the package you select provides anti-virus, anti-spam, and SSL encryption.

IT Support: Opt for a vendor with excellent customer feedback offering 24/7 support from information technology specialists.

Flexibility & Pricing: Even if you’re willing to pay more for additional features and quality service, make sure you’re not overpaying for a plan with very little room for personalization.