At prospective client meetings, confusion sometimes occurs when it’s time to discuss the monthly cost of a cloud solution. “Hold on, I’ll pay more per month, but it will cost me less? That doesn’t make sense!”
First and foremost, determining the cost of any IT solution comes down to your organization’s needs and capabilities. Are you a medium-sized accounting firm with a half-dozen accounting applications? A small business that just needs basic Office applications? You may decide to choose a cloud-service provider so you don’t have to spend time and money on the upkeep of your own IT infrastructure. On the other hand, a large company will probably opt to bring most of its IT infrastructure in-house and staff its own IT department.
According the latest Forrester and Gartner reports, an onsite infrastructure with a small IT department or an IT consultant could cost approximately $366 per user per month. Network Alliance’s pricing is usually between $200 per user per month and $350 per user per month depending on application and infrastructure needs. Here’s how it breaks down.
Purchasing and maintaining your own IT infrastructure forces you to take on a number of upfront and ongoing (often unbudgeted) costs. Equipment (like servers, workstations, and networking devices) have to be bought. Unfortunately, this equipment only lasts about three years on average and requires upgrades and/or total replacement. Don’t forget to add the cost of server and individual workstation software licenses, each having similar upgrade cycles.
The worst part is, though a big dollar investment, the majority of IT costs aren’t the hardware and software. Administration accounts for most of what you’ll spend on IT. A large enough company will have an IT department onsite to keep support and maintenance costs down, but that investment is often much larger than most companies can afford.
Smaller companies may opt to hire an IT consultant to design and maintain the infrastructure. But, IT professionals typically charge at least $100 an hour (and are generally only available at specific times), so maintenance costs add up quickly (and you can forget about individual user support). Take into account lost revenue due to downtime waiting for a consultant to fit you in, and your overall financial cost can be a really big number.
In the Network Alliance monthly pricing model, we replace all existing IT infrastructure. Instead of maintaining an organization’s constantly obsolete equipment at an hourly rate, all IT is maintained and supported 24 hours a day, 365 days a year. Additionally, because our service is cloud-based, it provides a uniform operating system, regardless of workstation make or model, preventing extra costs associated with compatibility.
So, while a monthly fee may seem higher than what you think you’re paying right now, you’ll find, if you add up the above costs for in-house technology, we actually cost around 30% less. For a more in-depth look, check out our Cost of Ownership page.
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