Enterprises across North America are finding that an application once thought of as basic has made its way onto the list of mission-critical items to manage.
E-mail has begun more and more to play a large role in businesses operations. In some situations, remote workers rely on it for all forms of day-to-day communications. Sales forces on the move depend on it for access to information while out visiting with clients. And even for many workers chained to their desks, e-mail has become the preferred method of communication.
With the growing number of e-mail transmissions travelling across networks, some companies are finding a solution to deal with e-mail – for while it might be a favourite application to use, the application is not a favourite to manage. Collectively, e-mail and messaging management in the enterprise is a long, painful and expensive process. And dealing with users if it goes down is not generally a pretty picture either.
Enter a proposition that has been around for years, but has yet to take off: outsourced e-mail.
Some telcos, ASPs and even specialized firms offer e-mail hosting as a service, hosted either on their sites, or in some cases, on the customers’ premises. A lot of the arguments or reasons for outsourcing this application ring true of outsourcing in general. For instance, a lot of companies turn to outsourcing if they feel their IT resources might be better spent engaged in activities or technology that is going to bring in revenue to their companies. Turning to a firm whose core competency is the IT element they are looking to outsource only makes sense for enterprises. This allows them to turn their focus to issues that concern their company specifically.
The task of maintaining such a critical element of the enterprise is another reason.
“You can achieve much higher reliability using an outsourcer in some cases simply because an outsourcer can offer you 24×7 management of the systems, whereas if you are not big enough to have three full-time shifts managing your messaging system, you really can’t afford to do that,” notes Michael Osterman, president and founder of Osterman Research Inc. in Black Diamond, Wash. “If, for example, an organization of 1,000 users wanted 24×7 management, the cost would almost be prohibitive, simply because having three shifts of people, plus people there on weekends is very expensive for a company of that size.”
And, as with outsourcing in general, there are those who hesitate generally for two reasons, according to Iain Black, the president and CEO of The Electric Mail Company Inc., an e-mail service provider in Vancouver. One reason is that enterprises do not want to give up control, and number two is that they don’t want to sacrifice or compromise with respect to functionality.
“But the beauty of what we do in our area is that because of the software that we have developed that we placed into the hands of our customers, most of it is through the Internet, so they don’t need to worry about installing stuff on their end.…They actually get more control than they could ever have, or have the skill or the money to develop,” he offers. “They could have more control over this resource called e-mail than they ever could themselves.”
Secondly, customers get more integrated functionality by working with a third party than they could by doing it themselves, he says.
Despite all the benefits that providers offer, the market for outsourced and hosted e-mail has not taken off. That, in part, could be due to the general slowdown in the economy, according to one industry observer.
“While (outsourced e-mail) has not been a barnburner lately, nothing actually has, given the economy,” says Karen Moser, senior research analyst at International Data Corp. in Framingham, Mass. “I think everyone has seen a slowdown, in particular when it comes to any kind of decision to make additional technology investments, although we are starting to see that pick up.”
She adds that she believes the outsourcing of e-mail makes sense, because it is more complex than people anticipate. In fact, she says a lot of enterprises decide to handle e-mail in-house first, and then realize how difficult it is and how much time and energy it takes to maintain.
“And I think that is when they come back and say, ‘Hey, this outsourcing is not such a bad idea after all. I think I do want to do that.'”
Osterman says that two years ago, he would have said the market for these services was going to take off and that a lot of companies would have been outsourcing by now. He says he believes it will take off – eventually.
“Messaging now is almost like plumbing. It’s absolutely critical to have plumbing in a building, but no matter how well you manage it, it’s not going to add any more to your bottom line,” he explains. “And for technologies like that, it tends to make sense to outsource, and to focus your IT resources on things that do provide that competitive advantage.”
Once companies realize that, he says, e-mail outsourcing will take off.
Signed, sealed and delivered
One Canadian company found outsourcing to be a good fit. About four years ago, Certified General Accountants’ Association Canada (CGA-Canada) in Vancouver decided to set up a process to enable its students to e-mail their assignments in to markers to be graded. The association essentially wraps up all of its autonomous, not-for-profit branch associations located in provinces across the country, according to Greg Jensen, a Web developer with the firm.
“We have the magazine which sets the standards to schedule the exams and we publish the course material which we resell to the regional associations. What we do is publish a complete…curriculum of professional studies for training accountants. They come out with a certification, and we also have some partnerships with universities for degree programs,” he explains.
The association has approximately 20,000 to 25,000 students across Canada, although not all of them are active or taking a course at once. As the courses are offered through distance learning, there are no instructors, so students send in any completed assignments to one of CGA Canada’s markers to be graded. With up to 1,000 markers, the association realized it had a sticky situation on its hands.
CGA turned to The Electric Mail Company for help. As an e-mail service provider and e-mail systems software developer, Electric Mail was able to assist CGA-Canada with a few things.
“[With the Electric Mail Company] we set up sub-domains for each of our provincial associations and we set up a structure or a method for naming the market e-mail account boxes,” Jensen says. “So the marker wouldn’t have their own personal e-mail being used for assignments coming in. They would have their own Internet service provider, but they would use our e-mail boxes provided by Electric Mail.”
Jensen says the structure would have been impossible for CGA to set up, so handing it off was the best decision.
Return to sender
In the case of CGA, its mail servers are hosted at Electric Mail’s site, which alleviates any management of the actual devices as well. This option enables Electric Mail to intercept all of the e-mail coming in, scan it for viruses or spam – additional services offered by the company – and send it on its way. Another option available to customers through the company is to have their mail stored at their own locations.
“Customers who want to use us for that are the ones who still have reasons why they would like to have their e-mail stored at their location, but they need somebody to act as an intermediary, a sentry if you will, to guard against some of the troubles that you can get into with Internet e-mails, such as viruses and spam,” explains Electric Mail’s Black. “Or they may also be using us simply because they have so many different domain names that they need somebody to play that middleman role to make sense out of all the coming-and-going traffic. We’re playing mailroom boy, effectively.”
He adds that the company is capable of delivering e-mail according to all industry standards, including POP and Web mail. A customer could, for example, be running Microsoft’s Outlook Express on her desktop and have different things running on her laptop and machine at home.
“That is our ability to mix and match each one of those,” Black explains. “It could involve a different e-mail protocol for the same user, for the same user account, for the same company. Despite that fact, we have got it set up to handle all three.”
AT&T Canada is one of the many telcos which also offers an e-mail service. It specifically provides Microsoft Exchange. Mark Zimmerman, director for infrastructure management in Toronto, explains that AT&T takes responsibility for the hardware that the service runs on, the software itself and the Internet and LAN connectivity that an enterprise requires to connect.
Costs for the services vary, depending upon the style or flavour the customer chooses. The first choice is offered strictly in a Web-based fashion using the Outlook Web client with no software on the end user’s desktop. It is priced at $15 per mailbox, per month.
“The next service up from that would be with the actual Microsoft Outlook desktop client as the means of accessing that, and we will support that client and so on,” Zimmerman says. “And that takes you to $20 per mailbox per month. The other flavour is a little more difficult to compare readily. We have a service where we will simply operate a [Microsoft] Exchange server for you and you can buy that server from us in various sizes and capacities.…There, really you pay more on the size of the server and the storage requirements than on a per-seat or per-user basis.”
While shipping your mail off for someone else to handle may in fact sound like a simple process, there are pitfalls that potential customers should be on the lookout for.
For example, “You do really need to plan very well for the transition from your current e-mail environment to this new service offering,” says AT&T’s Zimmerman. “You want to have a very robust project plan for doing that and ensure to your end users in your environment that this is a seamless transition for them.”
Osterman agrees, saying that lack of planning can lead to other problems.
“I think one of the big issues is the potential for conflicts between who manages what,” he explains. “Typically, what an outsourcer will do is provide all of the back-end management, all of the administration of the Exchange environment. However, if there is a conflict between what is a desktop issue and what is a back-end issue, sometimes there can be some problems, and the outsourcer might say, ‘You, the client, that is your problem because it is on the desktop,’ and the client may say, ‘Well, no, this is really a back-end Exchange issue.’ So there could be some finger-pointing there.”
To avoid this type of scenario, Osterman says a contract should be in place to straighten out the management issues.
“And that’s something that should be ironed out up front. And most of the outsourcers are probably more than willing [to accommodate] this.”