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Cost Savings with Office 365
<Speaker>
How Microsoft Office 365 Can Help Reduce Costs
The Future of Productivity
The cloud on your terms
Best productivity experience
across PC, phone, and browser*
Online
On-premises
Business Intelligence
Enterprise Content
ManagementCollaboration Enterprise
SearchUnified
Communications
*An appropriate device, Internet connection and supported browser are required.
Microsoft Office 365
BRINGING TOGETHER CLOUD VERSIONS OF OUR MOST TRUSTED COMMUNICATIONS AND COLLABORATION PRODUCTS WITH THE LATEST VERSION OF OUR DESKTOP SUITE FOR
BUSINESSES OF ALL SIZES.
Customer Value – Cost Savings
"Moving to Online Services will enable us to reduce our IT operational costs by roughly 30% of what we’re currently spending. The ability to introduce a variable cost subscription model for these collaborative technologies allows us to more rapidly scale or divest our investment as necessary“
Alastair Robertson VP of Information Workplace, GlaxoSmithKline
»Link to Case Study
Customer Value – Cost Savings
Dell believes that customers can rely on hosted infrastructure services such as high availability, backups, larger mailboxes, and disaster recovery at a much lower cost than if they provided the services themselves. Organizations may save thousands or even millions of dollars on purchases and support for IT hardware by moving to Office 365.
"With Office 365, organizations can make capabilities available that were previously unaffordable, or that they did not have the resources to support…Cloud-based services provide cost advantages for many organizations.”
»
Link to Case Study
Terry Storey, Senior Global Architect, Dell
Office 365 can help customers improve productivity and reduce IT costs• Reduced server hardware & maintenance needs• Automatic new version migrations• Potential ability to reassign headcount• Diminished infrastructure requirements
Additional IT benefits• Geo-redundant datacenters• 24x7 IT professional phone support• 99.9% financially backed SLA
Customers realize productivity benefits and reduced IT costs
Forrester TEI - Office 365 provides significant benefits (1)• Values based on Forrester TEI research; estimates based on
a composite organization moving to Office 365 – based on interviews with organizations on Office 365.
Office 365 business value
BenefitsValue
per user, per year
Eliminated hardware $20.69 Eliminated third party software $4.34 Web conferencing savings $14.29 Teleconferencing savings $6.86 EA licenses substituted with Office 365 subscription $45.37 Avoided on premises implementation labor $6.06 Reduced IT support effort $50.00 Reduced travel $94.64 Knowledge worker productivity gain $417.14 Mobile worker productivity gain $91.07
Annual benefits $750(1) Actual savings will depend upon specific environment
Link to ‘The Total Economic Impact of Microsoft Office 365 –Enterprise Customers’
Potential Cost Savings with Office 365
8
Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 -
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
Cost Comparison
On-premises Office 365
Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 -
5,000,000
10,000,000
15,000,000
20,000,000
25,000,000
30,000,000
Cumulative Costs Over 6 Years
On-premisesOffice 365
On-premises Office 365 -
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
4,000,000
4,500,000
6-Year TCO
DeploymentOperationsSoftwareHardware
On-premises Office 365 -
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
4,000,000
4,500,000
3-Year TCO
DeploymentOperationsSoftwareHardware
Example of a cost comparison of Office 365 vs. On-premises
for a 5,000 employee company –
results based on Office 365 TCO tool, will vary based on
environment
• Hardware• Software• Operations• Deployment
4 Cost Areas
Annual Averages
Hardware Cost Savings
The Wise Group (UK Non-profit)
In its data centers, The Wise Group will retire 50 to 60 physical servers by using Office 365, helping it to reduce administration, power, and cooling costs
“We can save a significant amount by outsourcing our solutions to Microsoft because we can retire much of the hardware we no longer need.”--Alan Lee-Bourke, CIO
Reduce upfront infrastructure investments
• Minimal on-premises hardware required - helps reduce capital expenses
• With Microsoft’s geographic redundancy at the data centers, 99.9% guaranteed uptime – could avoid significant costs to build redundancy in-house
• Reduce backup and disaster recovery costs• Reduce server maintenance, space, power, and
cooling costs
• No more server patching, updating, and upgrading • 24/7 IT-level professional support from Microsoft • Easy-to-use administration console lets IT focus on user
productivity, strategic planning and organization-wide deployment while Microsoft manages the risks and complexity of the backend
Operations Cost Savings: IT Administration
Cornerstone Mortgage(Financial Services, US)
With the user-friendly Office 365 web portal, the IT staff retains the administrative controls they want to configure locally, without having to worry about other administration tasks such as daily backups.
“With Office 365, we expect to reduce time spent on administration by 50 percent compared to an on-premise solution.”--Kyle Sandoval, Director of Server Operations and Architecture
Overall, Cornerstone expects to save $2.5 million over five years with Office 365.
Reduce admin costs by reducing IT effort on installation, patches, security updates, and
upgrades
Online Services “Start Here Tasks”
Deployment Cost Savings
hhpberlin(Professional Services,
Germany)
By using Office 365, hhpberlin will significantly decrease vendor costs from consulting fees to help deploy, upgrade, and update software for its on-premises applications.
“Since the experts at Microsoft will handle most of our daily maintenance for us in the hosted environment, hhpberlin expects a cost avoidance of €5,000 to €40,000 [U.S.$7,110 to $56,875] per deployment project.”--Stefan Truthän, CIO
Microsoft manages your upgrades to help reduce future deployment costs
• Microsoft deploys patches, security updates, and back-end upgrades, helping to eliminate the time and effort organizations spend managing their servers
• Automatic new version migrations• Fast deployments can result in lower costs
Software Cost Savings: Predictable License Costs
Forecast IT expenditures more accurately with predictable, pay-as-you-go costs;
reduce capital expenses
• Subscription pricing model helps forecast IT expenditures
• Most organizations should reduce capital expenses and shift some expenses from Capex to Opex*
• Flexibility to easily scale-up or scale-down licenses – pay for only the capacity and services needed
• Office 365 Suites offer discounts • Office 365 Plan E3 Suite offers 38%
discount off of the sum of the standalone components
Evco Plastics (US – Manufacturing)
“What we like about Office 365 is that it is one cost for us across the board,…The costs are fixed, and we do not have to worry about additional hardware, maintenance, or headcount.”--Eric Lam, IS Manager
*Consult your accountant for treatment of expenses
Case Studies
Company * Title/Link Cost Savings Quote/Metric Product
Albuquerque Bernalillo County Water Utility Authority (CA)
New Mexico Utility Modernizes Communication and Collaboration with Cloud Services
“We avoided the cost of hardware for Exchange Server, Lync Server, and SharePoint Server deployments. We just pay for the service, with no additional cost to us.”
Office 365
City of Carlsbad (EPG) City Government Uses Online Services for Mess
aging, Saves 40 Percent Annually
“We expect a savings of approximately 40% annually” BPOS
Cornerstone Mortgage (CA) Mortgage Company Reduces IT Costs by 40 Per
cent with Hosted Solution
Estimates U.S.$2.5 million in cost savings over five years Office 365
Dell (EPG) Dell Improves Client Service by Providing Anywhere Access Through Hosted Services
“Organizations may save thousands or even millions of dollars on purchases and support for IT hardware by moving to Office 365.”
GlaxoSmithKline (EPG) GlaxoSmithKline Leads the Way With Microsoft
Online ServicesReduce IT operational costs by 30% BPOS
Godiva Chocolatier (EPG)
By Moving Email to Cloud, Retailer Saves $250,000 Annually, Gains Business Agility
Estimates $250,000 annual savings plus predictable cost model BPOS
LPG (CA) German Medical Network Implements Cost-Effective Quality Management with Hosted Services
“The low cost of Office 365 was a key consideration for LPG. They can define exactly how many people should have access and what type of access they need, and then pay subscription fees only for what they need.”
Office 365
Rexel (EPG) Electrical Distributor Picks Proven Microsoft Messaging Technology over Google Apps
“The company officially estimates we will save 30 percent using Exchange Online.” BPOS
The Wise Group (CA) Social Enterprise Reduces Costs and Expands Services with Flexible Cloud-Based Solution
Saves $560,000in telephony costs, reduces travel by 30%, retires 50-60 physical servers Office 365
EPG = Enterprise customer, CA = Corporate Accounts
© 2011 Microsoft Corporation. All rights reserved. Microsoft and other product names are or may be registered trademarks and/or trademarks in the U.S. and/or other countries.The information herein is for informational purposes only and represents the current view of Microsoft Corporation as of the date of this presentation. Because Microsoft must
respond to changing market conditions, it should not be interpreted to be a commitment on the part of Microsoft, and Microsoft cannot guarantee the accuracy of any information provided after the date of this presentation.
MICROSOFT MAKES NO WARRANTIES, EXPRESS, IMPLIED OR STATUTORY, AS TO THE INFORMATION IN THIS PRESENTATION.