SharePoint Costs
Costs need to be seen in a broad perspective, taking the total cost of ownership in account. Since SharePoint is on premise software, you will need physical servers. SharePoint also requires Windows Server installed, which is the environment on which it runs. It also requires SQL Server, a database server where all SharePoint information is actually stored. In addition to initial and ongoing product costs this includes set up costs, costs of maintenance, costs of training, & cost of support.
Total Costs of Ownership (TCO) for SharePoint can be broadly broken down into two categories
Initial Costs:
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- Server hardware
- Windows Server and CALs (Client Access Licenses)
- SQL Server
- SharePoint Server and End User Licenses
- Spam and Virus control
- Real time back-up software and hardware
- Labor costs associated with system integration & configuration
Product Costs:
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SharePoint requires an ANNUAL licensing purchase for every :
- End-user
- Server
- Requires ANNUAL maintenance contract purchase.
The following table lists annual SharePoint 2007 server and end user license costs. As one can see, SharePoint licenses come in a variety of flavors depending on the specific needs of the organization.
Ongoing Costs:
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- Software upgrades
- IT infrastructure, software and hardware maintenance costs
- User support and training costs
- Hardware upgrades
An estimate of annual SharePoint costs for different scenarios is provided below. The bare minimum license costs have been considered, based on the famous SharePoint 2007 cost calculator by Bamboo Solutions. I have added to this a modest 15% as overheads in lieu of all the additional TCO costs mentioned above - hardware, IT staff, anti virus, backup and ongoing maintenance. One may notice that considering the high upfront costs, it will be highly cost ineffective to have SharePoint at lower scales, but it will scale up well.
SAAS Microsoft SharePoint Alternative Costs
Near Zero Initial Costs - In comparison, web based SharePoint alternatives offer the benefit of almost completely doing away with “Initial costs”, since there is no hardware, no additional software to implement. All you need is to sign up online and pay a monthly fees.
User/Space based Monthly Fees - The fee structure is a monthly fee based on number of users and storage space. And if a company want to upgrade there is usually an extra per-user and per-GB fees. This greatly enhances the predictability of the costs because there are almost no other costs involved.
No Support or Training Costs - Most of the better hosting companies provide free live support and customer training. This is in stark contrast to SharePoint which requires purchase of an annual service contract for every user.
It can well be seen that the cost difference between a web based solution and SharePoint is massive, put the costs begin to converge at larger scales. For this reason online collaboration software are more suitable for SMBs and SharePoint for enterprises.
