There are several major business reasons why many organizations are migrating away from Microsoft Exchange, including:
- High cost of upgrade to Exchange 2000
- Increased costs of Volume Licensing 6.0 and Software Assurance
- High risk of susceptibility to virus attacks
- Difficult administration and support
- Unclear path to the future
High cost of upgrade
Not only are Exchange users facing major losses due to security holes, they are also facing substantially increased costs. Microsoft's new Volume Licensing 6.0 program, in force since August 2002, has increased the cost of operating Exchange significantly. According to a Sunbelt Software survey1, 90 percent of all interviewed decision makers said that their Microsoft Licensing 6.0 costs would rise anywhere from 5 percent to 300 percent. The problem is that when Titanium is released early next year, Microsoft will begin to phase out support for Exchange 5.5, requiring Exchange users to upgrade to Exchange 2000 with Volume Licensing 6.0 and Software Assurance if they want to continue support.
Increased licensing cost is only part of the problem. As you well know, each time you upgrade Exchange, you have to deal with architectural changes that drive up the cost of upgrade. In upgrading from Exchange 5.0 to 5.5, you had to deal with revised data store formats resulting in painful conversion of data stores. Now look what you have to deal with in upgrading from Exchange 5.5 to Exchange 2000: to be able to take advantage of the full functionality of Exchange 2000 you must:
- Upgrade all Exchange 5.5 servers to Exchange 2000
- Upgrade all Windows NT* servers to Windows* 2000
- Deploy Active Directory*
The effort and cost are substantial. Moreover, you'll need to retrain your IT staff. To make matters worse, you must run in native mode to take advantage of all the new Exchange 2000 features. Unfortunately, you can't switch your Exchange system to native mode until you have upgraded all servers to Exchange 2000 and Windows 2000, which in many instances requires swapping out old hardware for new.
It's no wonder that the Sunbelt survey cited above also reveals that almost 40 percent of respondent companies said they plan to move away from Microsoft.
Increased costs of Volume Licensing 6.0 and Software Assurance
Information technology executives are up in arms over Microsoft Volume Licensing 6.0. An article in CIO Magazine2 states, "Underneath this seemingly simple plan to change how companies pay for software lay a not-so-simple plan to turn Microsoft into a utility that provided the electricity to power businesses, now and forever. Once that was understood, a strange thing happened. CIOs began to say no. No to Licensing 6.0. No to Software Assurance. And no to Microsoft's vision of the future."
In the same CIO Magazine article, customers complain that they are between a rock and a hard place. Either they pay annual Software Assurance fees beyond their normal licensing fees at the high rate of 25 cents on the dollar for servers and 29 cents on the dollar for PCs, or they have to pay for new licenses when they upgrade. In the article, the CIO of Rock-Tenn Co., a $1.5 billion packaging maker, said the 29 percent annual rate for Software Assurance was twice what he thought was justified for a subscription. The CIO says he expected to pay Microsoft approximately $1 million for upgrades without Licensing 6.0 and Software Assurance. Under the new pricing and licensing plans, he says, "Either I pay $1 million extra now [to sign up for 6.0 and Software Assurance], or $8 million three years from now," which is when he would prefer to get a Windows or Office upgrade. If the CIO upgrades when he wants to, on a timetable that makes sense for Rock-Tenn, it will cost his company $7 million more than if he upgrades now, when he doesn't want to.
As you know, the August 31, 2002 deadline to make your decision on your licensing future with Microsoft has already passed, and none of the options were attractive.
- You could have done nothing. But that means you must buy new licenses when you upgrade, and you must also enroll in the Software Assurance program at that time. The resulting costs are substantial.
- You could have bought the Upgrade Advantage Plan. That would have given you a two-year extension beyond the Software Assurance enrollment deadline. But you must pay for Upgrade Advantage for those two years, driving up your costs.
- You could have enrolled in Software Assurance. But you must pay high Software Assurance fees whether you take advantages of upgrades or not, increasing your costs.
- You could have purchased an Enterprise Agreement. That gives you upgrades as long as you are enrolled, but you must agree to use only Microsoft products purchased directly from Microsoft, and you must meet certain Microsoft-specified minimums. This approach locks you into Microsoft.
Because they are feeling squeezed by Microsoft, many organizations are considering a fifth option: moving away from Microsoft altogether.
High risk of susceptibility to virus attacks
It's no secret that Microsoft Exchange users continue to suffer from e-mail viruses and worms. Through a 3-year, $40 billion onslaught of Melissa, Love Bug, Code Red, Nimda and other viruses targeted at Microsoft Exchange, Outlook* and IIS, Exchange users have suffered serious disruptions to their businesses3. And that goes right to the bottom line.
The Code Red and the Love Bug attacks alone cost Exchange users an estimated $11 billion in 2001 and accounted for more than one-quarter of the costs associated with lost productivity and virus damage control for all viruses reported during the period of 1999-20014.
Difficult to manage and support
Exchange is noted for its management difficulty. This is evidenced by a joke circulating around Exchange sites. Question: Why is a Microsoft Exchange manager like a voodoo doll? Answer: Somebody is always needling him about a problem.
Exchange management and support costs are high due to several factors, including:
- High susceptibility to virus attacks. The IT staff spends considerable time repairing damage and supporting users.
- Cumbersome management by domain. Exchange 5.5 administrators have to manage each domain separately, greatly complicating administration. The only way to get single point management is to migrate to Exchange 2000 and Windows 2000 with Active Directory, and run in native mode. We've already discussed the high cost of making that move.
- Low reliability. Exchange is notorious for problems with reliability and system corruption. As a result, system managers and support staff spend quite a bit of time chasing down problems and supporting customers during outages.
Rocky path to the future
A recent article on the NetworkWorldFusion5 site states, "Microsoft stuffed a number of collaboration features in Exchange Server with great fanfare. Last week, the company started to tell network executives why it now plans to pluck them out. At its annual Microsoft Exchange Conference, company executives said that real-time collaboration, most notably instant messaging and conferencing, belongs in the base operating system and not Exchange." This will require considerable effort on the part of Exchange customers' network to make the switch. This announcement is yet another example of Microsoft's ongoing attempt to define its convoluted .NET infrastructure which will be its foundation for the next generation of distributed applications based on Web services technology.
A recent article on vnunet.com,6 a U.K. technology news site, states "SP3 for Exchange 2000, which Microsoft claimed would now be available, is anticipated to be the last one, as the company diverts its attention to Titanium development. "Instead of issuing a patch for Windows 2000 we decided to go back and make all of the improvements for .Net,' said Barry Goffe, group manager, enterprise marketing strategy at Microsoft." The same article also carried another quote that is unsettling to Exchange users. Gary Tugwell Smith, Exchange product manager at Microsoft said, "Architectural changes, functions and the way the software interacts with Windows means Titanium will only work with .Net."
Although Microsoft has promised that Titanium will be backward compatible with Windows 2000, Ewan Dalton, architectural systems engineer at Microsoft U.K., said, "The first release of Titanium will be at least feature compatible with the current Exchange 2000, but improvements to cover major features [as promised for .Net] will come in later versions."7