I just read about a service "Doyenz ShadowCloud" that talks about taking a virtual copy of your onsite Windows Small Business Server each day and putting it in the "cloud." From there you can use it as a backup in case your server goes down. It looks like you might just be able to run from it in the cloud also.
While services like this are becoming more popular I reserve my judgment as to whether they're really a good idea or not for anything but the backup. I think it's a good idea to have a backup and even to having a backup server hosted offsite you could use temporarily. But as to whether you'd want to use one as your primary server or not I just don't think so... at least not yet.
There will always be a blend of onsite and offsite IT services for my clients. As internet access to offsite services gets better, clients will use more and more of them. But, at least for now, I can think of a lot of good reasons to KEEP YOUR SERVERS.
Here they are:
1. Performance - accessing your data over a remote connection is just SLOWER. There are expensive technologies that promise to accelerate access to applications hosted remotely, but they're really out of reach for small businesses for the most part.
2. Ease of Use - when you connect to a remotely hosted service often you need to start a VPN. A VPN is an encrypted data connection between your computer and the server. This is necessary so that your data isn't easily available to everyone on the internet and ensures that only those that should have access are able to connect to your server. The downside is that A. You have to "connect" the VPN by clicking a button and typing in a username and password; and B. Your data is encrypted and decrypted at each end... causing a delay in accessing your data and making for a slower user experience (see #1, above).
3. Control/security - if you have a server in your office you can put it in a locked room or closet and know that the only way someone can get to it (physically) is if they open that door. While we are told that hosted systems in the cloud have big datacenter security, you generally don't know who is accessing your system and you may not even really know where it is. Theoretically it's unnecessary to know where your stuff is, but I'm a little old fashioned in that way I guess. I'd at least like a COPY of my stuff just in case something happens to that datacenter I've never actually visited in person.
4. Flexibility - when you put your systems in the cloud you generally lose the ability to customize the software on them. You also lose some physical things like the ability to hook up a hardware access/license key dongle if you have an application that requires one.
So, there are lots of reasons to keep your servers. In most cases, I'm going to recommend that my clients don't move 100% in to the cloud. It's just not ready. But, in some very specific instances it makes a lot of sense. And having some of your services in the cloud now is all but inevitable.
Next time I'll talk about when I *do* recommend businesses move to the cloud and for what parts of their Information Technology.
Monday, July 5, 2010 |
Wednesday, May 5, 2010 |
Reasons to Keep Your Servers
Next up... with all the great reasons to move in to the cloud, why would anyone want to host their own server any more?
Stay tuned...
Stay tuned...
Why Move to the Cloud?
The primary reason most companies move operations in to the cloud is... MONEY.
In the traditional way, a company needing a new e-mail server would:
1. Buy a new server ($3,000 - a relatively inexpensive one)
2. Buy an operating system and the e-mail software ($2,000 - Windows Server & Exchange)
3. Pay employees or consultant (15 hours or around $2,000) to install the whole thing
That's a capital outlay of $7,000. It's likely that server will need over the course of a 4 year lifespan:
1. $2,000+ in electricity and cooling
2. Hardware and software labor services up to 4x the cost of the server (say $6,000)
3. Hardware upgrades and replacement ($500 for misc components probably after 3-year warranty expires)
If you consider the total cost of owning that server over the course of 4 years then, the total is $15,500 for one single server.
Let's just say that e-mail server was going to host 30 e-mail mailboxes and do nothing else. You can purchase as a service in the cloud the very same e-mail solution for $10 per month per user. For 30 users thats $300 per month or $3,600 per year or $14,400 for 4 years.
You just saved over $1,000. You'll probably get more for your money too. Consider that:
1. Your server will be hosted in a Tier 1 data center with redundant power systems. It'll most likely be up more when hosted than if you keep it onsite.
2. They'll provide backups which might cost you $1,000 or more to just purchase software for, let alone maintaining the system for 4 years.
3. You'll get highly trained engineers that are pros at keeping servers running 24/7 and that's all they do. This will include monitoring of systems, patch management, etc.
4. You have a monthly expense rather than a capital outlay. That means you get to deduct the business expense on taxes rather than tracking depreciation.
5. The service will always be on the latest version of the software. No upgrades for you to manage.
6. You can add more mailboxes as needed and remove them when you don't need them. Never pay for more than you need.
Rinse and repeat. Every four years you save your $1,000+ when you continue to use the cloud rather than buy a new server.
In the traditional way, a company needing a new e-mail server would:
1. Buy a new server ($3,000 - a relatively inexpensive one)
2. Buy an operating system and the e-mail software ($2,000 - Windows Server & Exchange)
3. Pay employees or consultant (15 hours or around $2,000) to install the whole thing
That's a capital outlay of $7,000. It's likely that server will need over the course of a 4 year lifespan:
1. $2,000+ in electricity and cooling
2. Hardware and software labor services up to 4x the cost of the server (say $6,000)
3. Hardware upgrades and replacement ($500 for misc components probably after 3-year warranty expires)
If you consider the total cost of owning that server over the course of 4 years then, the total is $15,500 for one single server.
Let's just say that e-mail server was going to host 30 e-mail mailboxes and do nothing else. You can purchase as a service in the cloud the very same e-mail solution for $10 per month per user. For 30 users thats $300 per month or $3,600 per year or $14,400 for 4 years.
You just saved over $1,000. You'll probably get more for your money too. Consider that:
1. Your server will be hosted in a Tier 1 data center with redundant power systems. It'll most likely be up more when hosted than if you keep it onsite.
2. They'll provide backups which might cost you $1,000 or more to just purchase software for, let alone maintaining the system for 4 years.
3. You'll get highly trained engineers that are pros at keeping servers running 24/7 and that's all they do. This will include monitoring of systems, patch management, etc.
4. You have a monthly expense rather than a capital outlay. That means you get to deduct the business expense on taxes rather than tracking depreciation.
5. The service will always be on the latest version of the software. No upgrades for you to manage.
6. You can add more mailboxes as needed and remove them when you don't need them. Never pay for more than you need.
Rinse and repeat. Every four years you save your $1,000+ when you continue to use the cloud rather than buy a new server.
What is Cloud Computing?
Let's start with a definition from Wikipedia:
"Cloud Computing is Internet-based computing, whereby shared resources, software and information are provided to computers and other devices on-demand, like a public utility."
Now I'll break it down into something a little easier to wrap your brain around:
Any computing service you use that doesn't live on a traditional computer server in your office is probably "Cloud Computing."
Many companies use an e-mail filtering service that removes spam and viruses before delivering that e-mail to employee inboxes. That's cloud computing.
Some companies now send a copy of their data backups to the internet for offsite storage. That's cloud computing.
A recent popular example of cloud computing is Salesforce.com, a customer relationship management (CRM) application you access through a web browser. You could also consider Facebook a cloud computing application.
There are a couple different levels of cloud computing:
1. Applications (Facebook, Salesforce, Hotmail, etc.)
2. Platforms (places for people to build applications and not put them on their own servers)
3. Infrastructure (replacing or augmenting your own servers or networking equipment with some in the cloud)
For the purpose of this discussion we'll really just concentrate on applications and infrastrcture. We'll let people who do computer programming worry about the platforms for now.
"Cloud Computing is Internet-based computing, whereby shared resources, software and information are provided to computers and other devices on-demand, like a public utility."
Now I'll break it down into something a little easier to wrap your brain around:
Any computing service you use that doesn't live on a traditional computer server in your office is probably "Cloud Computing."
Many companies use an e-mail filtering service that removes spam and viruses before delivering that e-mail to employee inboxes. That's cloud computing.
Some companies now send a copy of their data backups to the internet for offsite storage. That's cloud computing.
A recent popular example of cloud computing is Salesforce.com, a customer relationship management (CRM) application you access through a web browser. You could also consider Facebook a cloud computing application.
There are a couple different levels of cloud computing:
1. Applications (Facebook, Salesforce, Hotmail, etc.)
2. Platforms (places for people to build applications and not put them on their own servers)
3. Infrastructure (replacing or augmenting your own servers or networking equipment with some in the cloud)
For the purpose of this discussion we'll really just concentrate on applications and infrastrcture. We'll let people who do computer programming worry about the platforms for now.
The "Cloud" and Your Business
What is the "Cloud" and how will it affect your business? You may be using the cloud right now and just not know it. What's available, what's good and what are your peers doing?
In this series of posts I'll be starting off with some general information on the "Cloud" and how Redwood's clients are using it now. We'll move on to where I (and the industry) see it going in the next couple years. If you're not already using something in the cloud now I'd be surprised and you'll be doing a lot more there very soon!
In this series of posts I'll be starting off with some general information on the "Cloud" and how Redwood's clients are using it now. We'll move on to where I (and the industry) see it going in the next couple years. If you're not already using something in the cloud now I'd be surprised and you'll be doing a lot more there very soon!
Wednesday, February 24, 2010 |
BUDRs Revisited
After working with the Datto and Zenith backup and disaster recovery (BUDR) appliances for a while it's time for an update. I've covered 5 categories: Reliability, Service, Integration, Pricing/value, Ease of Use. I've scored each device in each category and summed the scores out of a total of 50 points, 10 for each category.
Here's how it played out:
------------------------------ Zenith ------------------------------
Reliability - the boxes themselves seem to work fine, but periodically I get errors in the backups that require me to restart either the Zenith or the target box. I'm not sure if it's Zenith's software or Shadowprotect. It doesn't happen all that often and the monitoring and ticketing system notifies me well when it does.
Service - For being a e-mail/instant messaging only service, Zenith does a good job. I still wish I had a person to talk to on the phone though.
Integration - I use Autotask and Level Platforms and the Zenith just doesn't integrate all that well with them... I assume since they do their own monitoring. I understand that now I can have the Zenith system push tickets in to my Autotask but I haven't done it yet. I'm not sure I can do any monitoring of the Zenith box with my Level Platforms. I'd like to in order to keep everything managed by my NOC. That's a task for another day.
Pricing/value - While the Zenith has a considerably higher up front cost I'm not getting as much hardware for the buck. Zenith beefed up their servers in the last iteration but Datto still beats them in most all the models. You just need more RAM for virtualization... especially for things like SBS 2008.
Ease of use - the Zenith has a more robust interface, but it's clunky and has too many options buried in submenus. The remote access on the other hand is better for the Zenith since it uses Logmein IT Reach.
------------------------------ Datto ------------------------------
Reliability - The machine itself is at least as reliable as the Zenith. No problems with the hardware. The box is smaller and looks more like an appliance, so I thought maybe it would have cheaper hardware, but apparently not. They've been solid.
Service - The phone support has been spectacular. This is why I'm not looking back at Zenith. I call, get a person on the first try, and they speak English as a first language. Don't get me wrong, some of the support guys overseas are great, but you never know how much of an accent they'll have and sometimes that's a bar to communicating technically. As another item, it's a really nice but small thing to have them send out the offsite hard drive. They even notify you that you need to do it and it's easy to request. They manage the whole process better.
Integration - I don't think the Datto is much better than the Zenith, frankly. In addition, it's a Linux box rather than Windows, so I imagine it'll integrate less well with monitoring services. On the other hand, I've had less problems with the backups on the Dattos, so maybe it's not a big deal. I need to look further in to having the Dattos monitored and fully managed by my NOC.
Pricing/value - When I considered the two products pricing I took in to account several variables: initial cost, monthly cost for support, monthly cost for offsite storage. Because the Datto charges in 1 TB increments for offsite storage I compared the Zenith with similar amounts of storage offsite (the Zenith charges a base plus per GB over last I checked). It comes down to this... the Zenith has a much higher up front cost than the Datto. The Datto has a somewhat higher monthly cost. When I projected the cost of both out 3 years using 2 TB & 3 TB the Datto was hands down cheaper by over 20% for the term. Having more monthly charges for Storagecraft might change this slightly, but not enough to sway me... especially with the service and support bonus for Datto.
Ease of use - Ordering off their website is easy although I've had a couple problems with their website now and then. Maybe they were just doing upgrades to their web hosting hardware? It's easy to buy the Shadowprotect licenses and assign them to clients. Their phone tech support is stellar... have I mentioned that yet? The only problem I have is with the remote management capability of the box. There's a silly drop down box on the support website where you have to choose what you want to do and click submit. You then wait a while for an e-mail link that gives you the remote capability you requested (VNC, web access, etc.). It seems like this could use some work. It's just not nearly as nice as the LogmeIn IT Reach service.
------------------------------ Scoring ------------------------------
Scoring Zenith & Datto out of 10 in each category:
------------------------------ Conclusion ------------------------------
While I don't have any real problems with the Zenith product and they're both pretty slick offerings, I'm going with the Datto for two reasons - price and service. If you are on the Zenith monitoring platform that's probably enough to push you to the Zenith, but otherwise I recommend the Datto.
Here's how it played out:
------------------------------ Zenith ------------------------------
Reliability - the boxes themselves seem to work fine, but periodically I get errors in the backups that require me to restart either the Zenith or the target box. I'm not sure if it's Zenith's software or Shadowprotect. It doesn't happen all that often and the monitoring and ticketing system notifies me well when it does.
Service - For being a e-mail/instant messaging only service, Zenith does a good job. I still wish I had a person to talk to on the phone though.
Integration - I use Autotask and Level Platforms and the Zenith just doesn't integrate all that well with them... I assume since they do their own monitoring. I understand that now I can have the Zenith system push tickets in to my Autotask but I haven't done it yet. I'm not sure I can do any monitoring of the Zenith box with my Level Platforms. I'd like to in order to keep everything managed by my NOC. That's a task for another day.
Pricing/value - While the Zenith has a considerably higher up front cost I'm not getting as much hardware for the buck. Zenith beefed up their servers in the last iteration but Datto still beats them in most all the models. You just need more RAM for virtualization... especially for things like SBS 2008.
Ease of use - the Zenith has a more robust interface, but it's clunky and has too many options buried in submenus. The remote access on the other hand is better for the Zenith since it uses Logmein IT Reach.
------------------------------ Datto ------------------------------
Reliability - The machine itself is at least as reliable as the Zenith. No problems with the hardware. The box is smaller and looks more like an appliance, so I thought maybe it would have cheaper hardware, but apparently not. They've been solid.
Service - The phone support has been spectacular. This is why I'm not looking back at Zenith. I call, get a person on the first try, and they speak English as a first language. Don't get me wrong, some of the support guys overseas are great, but you never know how much of an accent they'll have and sometimes that's a bar to communicating technically. As another item, it's a really nice but small thing to have them send out the offsite hard drive. They even notify you that you need to do it and it's easy to request. They manage the whole process better.
Integration - I don't think the Datto is much better than the Zenith, frankly. In addition, it's a Linux box rather than Windows, so I imagine it'll integrate less well with monitoring services. On the other hand, I've had less problems with the backups on the Dattos, so maybe it's not a big deal. I need to look further in to having the Dattos monitored and fully managed by my NOC.
Pricing/value - When I considered the two products pricing I took in to account several variables: initial cost, monthly cost for support, monthly cost for offsite storage. Because the Datto charges in 1 TB increments for offsite storage I compared the Zenith with similar amounts of storage offsite (the Zenith charges a base plus per GB over last I checked). It comes down to this... the Zenith has a much higher up front cost than the Datto. The Datto has a somewhat higher monthly cost. When I projected the cost of both out 3 years using 2 TB & 3 TB the Datto was hands down cheaper by over 20% for the term. Having more monthly charges for Storagecraft might change this slightly, but not enough to sway me... especially with the service and support bonus for Datto.
Ease of use - Ordering off their website is easy although I've had a couple problems with their website now and then. Maybe they were just doing upgrades to their web hosting hardware? It's easy to buy the Shadowprotect licenses and assign them to clients. Their phone tech support is stellar... have I mentioned that yet? The only problem I have is with the remote management capability of the box. There's a silly drop down box on the support website where you have to choose what you want to do and click submit. You then wait a while for an e-mail link that gives you the remote capability you requested (VNC, web access, etc.). It seems like this could use some work. It's just not nearly as nice as the LogmeIn IT Reach service.
------------------------------ Scoring ------------------------------
Scoring Zenith & Datto out of 10 in each category:
| Category | Zenith | Datto |
| Reliability | 8 | 9 |
| Service | 6 | 10 |
| Integration | 7 | 7 |
| Pricing/value | 6 | 8 |
| Ease of use | 7 | 6 |
| Overall | 34/50 | 40/50 |
------------------------------ Conclusion ------------------------------
While I don't have any real problems with the Zenith product and they're both pretty slick offerings, I'm going with the Datto for two reasons - price and service. If you are on the Zenith monitoring platform that's probably enough to push you to the Zenith, but otherwise I recommend the Datto.
Tuesday, January 26, 2010 |
Justifying the cost of managed services
A friend of mine asked this question recently. They're in a market we don't serve and are considering purchasing managed services from a local company. I thought it worth posting here. It's always interesting to try to dissect other service provider's pricing on managed services.
Question:
Our service provider wants $775.00 per month to provide unlimited hours of service for 1 server and 7 desktop/laptops, or $490.00 per month for a capped hours option. This does not include overage charges ($135.00/hour) or any project or after hours support.
Your opinion about what we need and the fee amount they are charging?
Answer:
Most companies justify the cost by saying that if you have unlimited support you’ll use it more often since you don’t worry about the cost of each call (like having health insurance) and your computer system will be healthier. It’ll cost more in the short run but productivity gains in the long run due to the system being up more and better maintained should make up the difference and then some.
Regarding the capped usage option, look back over your usage of the service provider over the past 6 months. Get an average number of hours per month and multiply it by $135 (we assume this is their normal hourly rate). You shouldn’t be paying more than 20% over that amount for unlimited hours unless something else is included like remote monitoring, managing Windows updates, free equipment upgrades, software, etc.
Industry standards for providing unlimited support range from $250-350 per server and $30-60 per workstation per month. There may be some additional charges for multiple locations and other a la cartes. For these prices most companies will provide remote monitoring, unlimited phone support and onsite support but no hardware or software. If they’re going to throw in a new server, any workstations, software or anything else that would increase the amount.
There’s no reason why you can’t bargain with them either. You can ask for $650 per month for unlimited and see if they’ll meet you at $700. They’re likely to have 20-30% of that as fixed-costs and the rest is a buffer. Sometimes you’ll need more services than the remaining 70% covers but most of the time you’ll use less… much less if they’re good at their job. If they do a good job of keeping everything working and are responsive and good to work with I would suggest that $775 is a good price. You're looking at total value, not the cheapest solution here. You have to factor in the less substantial costs of lost productivity and your internal time lost managing Information Technology that will now be handled by someone else.
Regarding the capped hours option, look back at your average spend with them for the last 6 months. Look at how much service time you’ve been purchasing from them per month; compare that to the number of hours they cap at for the $490 option. If your average is under the cap and you’ve been spending more than $490 per month on invoices for them then it’s a good deal. Otherwise it isn’t.
Complicated isn’t it? I’d probably recommend the unlimited option if there’s no contract term. If they want you to sign up for 12 months or something you might consider doing month to month for a few more months to get a good idea what your monthly costs are going to be and then ask them to reconsider their pricing. Before you get in bed with someone you’re going to sign a 12 - 36 month contract with you should get to know them and get a feel for the quality and consistency of their work. Make sure you’re not just getting 3 months of initial attention and then being ignored for the next 33. If they don't offer that option, ask to have the contract amended to include a honeymoon period of 3 months after which you can cancel if you're dissatisfied. After that 3 months the contract should renew automatically for the remainder of the term unless you provide written notice to the service provider.
Question:
Our service provider wants $775.00 per month to provide unlimited hours of service for 1 server and 7 desktop/laptops, or $490.00 per month for a capped hours option. This does not include overage charges ($135.00/hour) or any project or after hours support.
Your opinion about what we need and the fee amount they are charging?
Answer:
Most companies justify the cost by saying that if you have unlimited support you’ll use it more often since you don’t worry about the cost of each call (like having health insurance) and your computer system will be healthier. It’ll cost more in the short run but productivity gains in the long run due to the system being up more and better maintained should make up the difference and then some.
Regarding the capped usage option, look back over your usage of the service provider over the past 6 months. Get an average number of hours per month and multiply it by $135 (we assume this is their normal hourly rate). You shouldn’t be paying more than 20% over that amount for unlimited hours unless something else is included like remote monitoring, managing Windows updates, free equipment upgrades, software, etc.
Industry standards for providing unlimited support range from $250-350 per server and $30-60 per workstation per month. There may be some additional charges for multiple locations and other a la cartes. For these prices most companies will provide remote monitoring, unlimited phone support and onsite support but no hardware or software. If they’re going to throw in a new server, any workstations, software or anything else that would increase the amount.
There’s no reason why you can’t bargain with them either. You can ask for $650 per month for unlimited and see if they’ll meet you at $700. They’re likely to have 20-30% of that as fixed-costs and the rest is a buffer. Sometimes you’ll need more services than the remaining 70% covers but most of the time you’ll use less… much less if they’re good at their job. If they do a good job of keeping everything working and are responsive and good to work with I would suggest that $775 is a good price. You're looking at total value, not the cheapest solution here. You have to factor in the less substantial costs of lost productivity and your internal time lost managing Information Technology that will now be handled by someone else.
Regarding the capped hours option, look back at your average spend with them for the last 6 months. Look at how much service time you’ve been purchasing from them per month; compare that to the number of hours they cap at for the $490 option. If your average is under the cap and you’ve been spending more than $490 per month on invoices for them then it’s a good deal. Otherwise it isn’t.
Complicated isn’t it? I’d probably recommend the unlimited option if there’s no contract term. If they want you to sign up for 12 months or something you might consider doing month to month for a few more months to get a good idea what your monthly costs are going to be and then ask them to reconsider their pricing. Before you get in bed with someone you’re going to sign a 12 - 36 month contract with you should get to know them and get a feel for the quality and consistency of their work. Make sure you’re not just getting 3 months of initial attention and then being ignored for the next 33. If they don't offer that option, ask to have the contract amended to include a honeymoon period of 3 months after which you can cancel if you're dissatisfied. After that 3 months the contract should renew automatically for the remainder of the term unless you provide written notice to the service provider.
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