Google Apps vs Microsoft Hosted Exchange Comparison

Please note that this article is over two years old and has not been updated since its initial publication. Both services have gone through substantial changes. The article may still be useful as a jumping off point on your research, but don't cite anything from this article as fact to your boss!

Many small and mid-sized businesses are re-evaluating their email service. In the past, the de-facto email standard was Microsoft Exchange installed on a Windows server that you hosted in house. In the past couple of years, many new options have emerged and are being considered seriously by small business. The two major competitors in the Software as a Service (SaaS) market are Google Apps and Microsoft Hosted Exchange.

Why hosted email?

Before we can get into the pros and cons of Google Apps and Hosted Exchange, we first have to examine why people are moving over to hosted email in the first place. I think it is safe to say that most users expect email to work ALL the time. For small companies with a small or non-existent IT department, providing a service with 99.9% uptime is fairly difficult and expensive. Anytime that there is a disruption in service, such as the server going down or being compromised, the IT admin has to scramble to get everything up. Any downtime whatsoever results in extremely unhappy users and an exhausted and stressed IT admin. Another big issue for expanding companies is scalability and how much it costs to do that scaling.

How does hosted email solve this problem?

A hosted email solution with a reputable company offers extremely reliable email service without all of the headaches and costs. Scalability is a non-issue, as a company like Google or Microsoft is already handling hundreds of thousands (if not millions) of email accounts. Keeping their system up and running is something that both take extremely seriously, and pump millions of dollars and very talented engineering into. Basically, economies of scale allows these large companies to provide a better email service at a cheaper price.

Google Apps - Market Leader?

Google has been in the SaaS business for a few years now with their Google Apps product. Google Apps rolls a few products into one integrated solution. These products are:

• Gmail - Email
• Calendar - Shared calendaring
• Google Docs - Storage and colloborative editing for documents
• Google Sites - A quick and dirty way of making internal websites for projects or teams. Think "Sharepoint Extremely Lite"

I was unable to pull up any numbers on exactly how many people are subscribed to Google Apps Standard or Google Apps Premier, but I think it is safe to say that it is up there. They have been in the business for a while and just about every IT person I know has heard of it.

Microsoft Business Productivity Online Suite

Microsoft has just started really pushing their Business Productivity Online Suite (BPOS) service. Again, I have no numbers to go by, but since it is such a new service I highly doubt that is has eclipsed Google Apps at this point. What Microsoft really has going for it in this market is their extremely large channel and reseller base that can immediately start pushing this service to clients all across the world. BPOS includes the following services:

• Exchange - Email, calendars, contacts
• Sharepoint - Document storage and sharing, collaboration
• Live Meeting - Web conferencing solution

Now, one important point to make is that I will ONLY be considering the Exchange portion of BPOS. The reason for this is that Microsoft charges for Exchange, Sharepoint and Live Meeting separately. To keep the prices between Google Apps and BPOS remotely close, I have to exclude Sharepoint and Live Meeting.

Google Apps and Microsoft Hosted Exchange Compared

Google Apps and Microsoft Hosted Exchange are similar in a few ways. Let's take a look at just exactly where they are similar:

• Email - Both services are going to give you extremely reliable up-time on your email service
• Spam Filtering - They both offer excellent spam filtering
• Multiple domains - You can have multiple domains, or aliases, per account (Had to talk with a Microsoft rep to get that info...)
• Web interface - Both offer a web interface to their email service
• Archival - Both offer email archival included in the price of the accounts

Okay, so now you know where they are similar, but how do they differ?

• Storage - Google offers 25 GB per user, Microsoft 1 GB per user
• Price - Google is $50 per user per year, Microsoft bills in monthly increments at $10 per user per year, coming out to $120 a year
• Document Collaboration - Google offers their Google Docs service, Microsoft gives you nothing. You have to pay extra for hosted Sharepoint.
• Desktop email client integration - Exchange, frankly, kicks ass here. If your users use Outlook heavily, Exchange is the way to go. Google provides IMAP and POP access, but uploading calendars and contacts requires a Google Desktop Sync application that only runs on Windows.
• Web client - While both services offer web interfaces, Google takes the cake here. Google Apps was built from the ground up for the browser, and it shows. Exchange Outlook Web Access (OWA) has been improved though.
• Intranet - Google Apps offers the Sites service, which is like an extremely stripped down version of Sharepoint. As I stated earlier, Sharepoint is an extra monthly cost for BPOS.
• IM/Chat - Google Apps offers this out of the box with the Google Talk application, the option is not there even if you are willing to pay for it with Microsoft currently.
• Tasks - Exchange has tasks, Google Apps doesn't.
• Mobile Phone Integration - Exchange takes the cake here, almost every single smartphone on the planet has Exchange support. Google Apps support is all over the map, with Blackberry being the best supported, then the iPhone. Email isn't a problem for either, but if contact/calendar syncing is important and you don't use Blackberry's, stay far far away from Google Apps
• Video conferencing - This is a new feature from Google, but one that is a key differentiator in my opinion. Microsoft does not offer it.
• Support - Microsoft blows Google away on this one. As a reseller, I can call up a Microsoft rep 24/7 with any question whatsoever. With Google, they only provide phone support if the service is down, they do not help you implement it in your organization. Google does provide excellent online documentation.
• Active Directory Integration - No surprise here, hosted Exchange is much easier to integrate with AD. There are ways to integrate Google Apps with active directory, but it requires some Python scripts. Microsoft wins here.

That pretty much covers the major differences that I have come across in my time working with both products. For my final comparison on what one came out best, I put together a little spreadsheet. I scored both services over a variety of key (in my opinion) features and put them on a 5 point scale, with 5 being the best. The highest score possible is 45.

Google Apps and Microsoft Exchange Compared - Click to see full size

As you can see, Google Apps just beat out Hosted Exchange. The key was all those extras that Google throws in and that Microsoft does not.

Conclusion

If I was starting a company today, and needed to choose an email/collaboration system, I would go with Google Apps. The main reason for that is cost, Microsoft is simply charging too much. I am also extremely comfortable with web applications. But just because I like it, doesn't mean your users will. I would highly recommend doing a requirements study, and seeing just how users are currently utilizing their email system. Both services have their upsides and downsides, but overall, both are excellent and would serve most organizations well.

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Comments

[Paul Bauer]

Awesome post! I have been using Google Apps for Bauer-Power.net for a long time now. The features are excellent, and easy to manage. Plus you get a crap load of storage space! Win win if you ask me.

-Paul

[Rob Steenwyk]

The features are indeed excellent, and they just got better. The main problem that I had with Google Apps has now been resolved, as Google just released their Google Sync Tool that allows you to sync calendar and contact data from Google Apps to Windows Mobile, Nokia and iPhones.

This was literally just released, and it really is a big one. It will mean a lot more companies will be able to look at Google Apps seriously.

You can check it out here, http://www.google.com/mobile/default/sync.html

[brainrush]

Thank you for this article.
If I switch to google apps, will ALL my emails that belong to that domain have to be routed through google?

[Rob Steenwyk]

Yes, all emails for the domain would be routed through Google. Same as with Hosted Exchange.

[James]

Great summary - thanks

Absolutely agree that i'd go with Google Apps if i was building our companies IT system from scratch today....but the thing that's stopping me from jumping all over MSOS and moving our email from the inhouse Exchange server is the laughable 1Gb allowance, i mean really??? Looks like Bill's '640k of memory is all any computer would ever need' quote was true after all going by this offering....come on Microsoft make it even just 10Gb per user and I'll bite.

[Rob Steenwyk]

Yeah, I was amazed that they were offering a mere 1 GB per user as well. One thing to note is that you can move that storage around, so say you have 10 users but 5 of them hardly use email, you could only give them 200 MB and give the rest to the other 5 for more storage.

[binay]

this is awesome info.

my company is looking to move inhouse exchange server. we are looking at exchange hosting service or google apps.

calendar, local outlook client and blackberry push email is very important for our compnay. will google calendar and blackberry push (for both push email + calendar) support is of same standard as exchange + bb server combined!

Does google work good with MS outlook client and calendar?

thanks in advance for feedback!

[Rob Steenwyk]

Thanks for the kind words Binay, I am always happy to hear that my articles are making someone else's life a bit easier!

Blackberry Sync - Google supports email/calendar/contacts with Blackberries. I have never used Blackberry Server, but from what I understand it gives you the ability to remotely wipe the phone in case of theft. If you needed this functionality you would still need the BB server. But if you just need email/calendar/contact syncing, Google Apps will work fine. Take a look at the sync tool, http://www.google.com/mobile/blackberry/sync.html

Outlook Sync - It works okay. Email will be accessible in any email client with POP or IMAP, but calendars and contacts are more tricky. To sync both contacts and calendars you will need the Google Desktop Sync tool, which only runs on Windows XP and Vista. If you have Macs, you are out of luck.

If every Outlook feature is absolutely vital, then stick with Exchange. But the Outlook support with Google Apps isn't bad, as long as you are running XP or Vista.

[binay]

thank you for your response. your info is very usefull.

thanks again!

[TomM]

GAPE has tasks now - fairly new.

[Vijay Shah]

Hi Rob,

Great competitive info in the article.

I would like to know how did you find the microsoft email cost per user 120$ / per year. I looked at the pricing details and it says 14.95 per year ( first 12 months free) for 100 email accounts. Here is the corresponding link. http://smallbusiness.officelive.com/pricing/offers/

Can you provide more details ?

Thanks
Vijay Shah

[Rob Steenwyk]

@Tom
Thanks for letting me know, but an FYI is that the feature isn't supported by Google. You have to enable the Google Labs feature, and then users will have to go into their settings and enable it. It doesn't look like the domain admin can enable it for every user domain wide. Would be very nice if Google would support syncing tasks to Outlook and enabling it for every user domain wide :)

@Vijay
Office Live is a different product focused on very small businesses, and it isn't technically hosted Exchange (although it very well could be using Exchange on the back end, I don't know). Office live basically gives you basic email and web hosting. The hosted Exchange that I was talking about is branded under "Business Productivity Online Suite" and can be accessed here, http://www.microsoft.com/online/exchange-online.mspx

Thanks for the comments guys!

[Jeff Adzima]

Great Article Rob - Good Research. I would like to point out that your numbers are a bit off. I'm a MS certified partner and we just completed training on the BPOS product. I'd say you'd have to include the Sharepoint and Live Meeting functionality in your comparison because then you'd probably be tied with Google Apps. Also the pricing is currently at $10.95/user/month for all three apps, Exchange, SP and LM. MS also announced recently that they are going currently at 25GB/user as well and one final point is that Live Communications Server App will be coming online by the end of the month.

Don't you just love competition!

Keep up the good work!

[Rob Steenwyk]

Jeff,

Sorry for the long delay, but could you point me to the updated pricing? I haven't been able to find it. Are you sure that the price you are talking about isn't actually a partner reseller price? We are a Microsoft Gold Partner and can resell the service, but I haven't taken a look into what our price is yet.

And yes, hosted Sharepoint & Communication server would most certainly bring it up to par with Google Apps, or even exceed it. And honestly, how much stock does anyone put into a spreadsheet that I spent 30 minutes on :) ? Both products can fit into organizations in different ways, at some Google Apps will be the winner, others BPOS.

Thanks for the kind words, and for taking the time to comment!

[Daniel Jefferies]

One advantage to the Google Apps solution that I don't see addressed here is Google's rapid innovation. Great features are added to Google Apps weekly and in small increments. This decreases user pain associated with change while providing rapid access to the latest toolsets. While I feel that some of the tools in the Google Apps suite are behind where I would like to see them ultimately, Google is rapidly catching them up.

The hosted Microsoft solutions by comparison are based on Exchange which has a 3 to 4 year development cycle between versions and when new versions come out there is massive user and administrative pain associated with them.

In addition Microsoft's offerings, again being Exchange based, are not on built a distributed model or cloud computing model and as such are still vulnerable to single server failure causing downtime which suggests that they won't have as good of an uptime profile as true cloud computing SaaS offerings like Apps.

Overall, Microsofts offering looks to me like a repackaging of their aging paradigm, Exchange, but with some new "hosted" party cloths. Google on the other hand is making an honest attempt to provide a new more efficient paradigm for messaging and collaboration. In my view it is ready for primetime business use as long as the implementation and retraining is being done by cluefull people.

Full disclosure, my company has installed and supported Microsoft systems for years but has recently become a Google partner due to our belief that true cloud computing SaaS solutions provide a more efficient model for clients.

[Allen Falcon]

Are you planning to update the comparison given recent developments. Here are a few for Google Apps Premier Edition

Desktop email client integration: Google has released a MAPI connector that gives Outlook users full functionality when using Google Apps.

IM/Chat - Google Apps includes PC-to-PC VoIP and Video Chat (a la Skype) along with "on record" and "off the record" modes

Intranet -- Google has added personalized start pages to Sites (used to be a separate app) that allows 3rd party widgets to be added into sites. Google Gears cloud platform is now open -- expect more application development.



Tasks - Google Apps now has Tasks fully integrated. 1-click to turn an email into a task; set a due date and tasks can be displayed as events on your calendar

Mobile Phone Integration - Google Apps still has a range of solutions based on device, but now has BES integration for Blackberry devices and ActiveSync support.

Support -- Support is available 7x24 if you pick the right reseller. Google Apps Resellers have 7x24 access to Google Support teams, although not to the extent of Microsoft's support services.

Regards,
Allen
www.horizoninfoservices.com

[Cpanel Hosting]

Great post there. We use google apps and the latest outlook sync tool takes it beyond exchange anyday.

[Bruce Prime]

If it has not already been addressed the following item should be updated:

"Document Collaboration - Google offers their Google Docs service, Microsoft gives you nothing. You have to pay extra for hosted Sharepoint."--- Not true. There is Office Live Workspace for sharing documents; completely free and interacts seamlessly with your desktop MS Office.

[Rob Steenwyk]

Thanks for the comments Bruce & Allen.

I don't follow this space on a day to day basis, so yes, this article will become out of date over time. But as for Bruce's comment regarding document colloboration and Office Live Workspace... that doesn't seem to be a part of BPOS, it is a separate product that is in beta. If I am wrong, and there is a supported version of it in BPOS, please let me know.

[Russ Casey]

We migrated from exchange to google apps last year. Despite the lack of direct assistance from Google, it was really easy. Because Outlook's autoarchive feature stores old mail on desktops rather than the server, we chose to have each user to us Google's 'upload' tool to upload all their mail from the desktop. This was a simple process, and no users had any difficulty. Then we just updated the MX records and switched off the Exchange box.