Over the last year, we’ve seen a dramatic increase in the number of requests for Office 365 or SharePoint Online. Microsoft has been heavily promoting their cloud-first strategy, and the market has responded.
Perhaps because so many people now have personal experience with the cloud, users are becoming more comfortable with the idea of using it for storing critical information. It seems that the more experience you have with the cloud, the more you trust it. A recent survey of cloud users ranked their concerns in this way:
The things that concern beginning cloud users do not concern experienced cloud users. Security specifically dropped from 31% to 13%.
Financial motivation for moving to Office 365
The obvious reason for moving to the cloud is financial. The cloud offers better quality at a lower price than on premise models.
For example, exchange online (a component of Office 365) for 100 mailboxes costs $4,800 per year. It includes spam protection and 50 gig mailboxes and has high availability. To create an on premise exchange environment that replicates this service would cost well over $20,000 to set up, and several hundred dollars a month in maintenance, electricity, and server space.
Trade a little backend control for a big overhead savings.
Other Drivers for the Office 365 migration
Increasingly, however, the advantage in moving to the cloud is flexibility and innovation. Office 365 subscriptions easily scale up and down with the changing needs of the company, and Microsoft’s Cloud First strategy gives cloud users a strong advantage.
Not only are Office 365 users automatically upgraded with each major release, they also receive new features as they become available. For example, Outlook Clutter, Office Delve, and Excel Power Maps are all available exclusively to companies that use Office 365. On Premise users will have to wait until they can buy and deploy SharePoint 2016 and Office 2016, and some of these features may never be released to On Premise customers.
Office 365 for the Enterprise
I think one of the common misconceptions is that Office 365 is only for small companies. The idea is that large organizations have unique enough needs, or large enough environments that the extra cost of having on premise servers is justified. Large IT groups need to be able to control and integrate their environments to an extent not possible in the cloud.
There are some advantages to having servers on premise, or at least in a private cloud. Some features in SharePoint are only available on premise, most notably Project Server. Regulatory compliance may also be easier with on premise servers (though this objection is eroding as Microsoft’s cloud is certified by more and more regulatory bodies), and integrations with some line of business programs may require on premise servers.
Microsoft is working hard to bring more enterprise customers into their Office 365 cloud. Some clients include, Aston Martin, Metlife, Colliers, and BNSF. I suspect these companies are driven to the cloud more by the need for innovation that direct cost savings.