Cost Savings

Cloud Hosting, Hosted Datacenter Outsourcing

Cost Savings Comparison

Cloud hosting is rapidly becoming a significant method to cut corporate costs across the board by up to 50% or much more in many cases.

Outsource Savings – Cost comparison below is typical for a company of 300 employees with 16 servers, each performing a particular task such as database servers, frontend web servers, file servers, accounting servers, etc..

The Gartner Group estimates that construction costs for the average data center amount to $465 per square foot and can take up to 12 months to build. This means constructing an adequate data center would most likely cost you millions of dollars, not to mention the time and personnel to evaluate vendors, site location, building criteria, environmental systems, hardware and software. And, this estimate does not include capital investments in data processing or sourcing servers, communication equipment and other IT hardware. 724 Internet Solutions has already done all of the legwork for you.

Transferring your data center to 724 Internet Solutions outsourced environment will not only save you money, it will lower your total technology costs by freeing up your IT staff to concentrate on running your business. And, by putting your technology in the hands of a capable, experienced provider, you can be sure that every factor has been considered to make sure your applications, data and equipment are in a table, secure environment. We will help you make a smooth transition to your new by project managing and implementing the entire migration quickly and within your budget.

Comparative Cost of In-House vs. Hosting in the Cloud
Year 1 In-House The Cloud
Server Hardware $100,000 $0.00
Router/CSU/DSU $12,500 $0.00
UPS Backup $20,000 $0.00
Software Licensing $25,000 $0.00
Hardware servicing fees (15% depreciation) $7000.00 $0.00
Staffing $200,000 $0.00
DS-3 Internet Connectivity $35,000 $0.00
Initial Configuration/Setup $10,000 $10000
Hosting Fee $0.00 $60,000
Hardware and Software Support $0.00 $42,000
Generator Backup $15,000 $0.00
Total Expense for Year One $424.500.00 $112,000.00
Year 2 In-House Outsourcing
Hardware servicing fees (15% depreciation) $7000.00 0.00
Staffing $200,000 0.00
Software Licensing $25,000 0.00
DS-3 Internet Connectivity $35,000 0.00
Hosting Fees $0.00 $60,000
Hardware and Software Support $0.00 $42,000
Total Expense for Year Two $267,000.00 $112,000.00

Why Companies Outsource to the Cloud:

The cost of implementing the necessary steps required to host a web site, Intranet or Local Area network is probably the biggest reason why 62% of companies outsource this activity. A server is merely the first of many purchases and ongoing expenditures required for hosting applications. In addition to the expected upfront and ongoing costs, upgrading hardware and software and replacing malfunctioning parts can create unexpected expenditures.

When outsourcing, the hosting company takes care of these issues at no additional cost. When outsourcing, your site can be live in days, rather than in the weeks or months it may take to purchase equipment and hire technical personnel. A web hosting company has a server to meet your needs in stock now, and has the personnel on-staff to set your site up quickly. The table above compares the operating costs in the first two years of an in-house operation versus outsourcing. Of course, these costs are estimates and may differ for any one specific situation.


In-house Solution Outsource with 724
Unexpected Expenses – Thousands of immediate out-of-pocket expenses
Unpredictable ongoing costs of management and upgrades
Predictable Costs – Save thousands on deployment (724 will backup and restore your data free of charge) Ongoing costs are predefined and easy to budget Cost savings (in-house vs. hosting at 724)
Staff/Training Budget – Costly new hiring and training of dedicated personnel No IT Staff Needed – Lower cost of management and operations by using us as your IT staff, while you focus on business-strategic areas
High Maintenance: Additional features such as web parts, templates and single sign-on are hard to deploy due to the lack of: technical expertise allocated budget resources World Class Service: Solutions are available right away and the price is very reasonable
Workers’ productivity suffers dramatically if older version of SharePoint is still running in-house Always the latest technology: The best equipment and software and support available.
Inexperience: In-house staff may not have the necessary experience to support the Software. If they do have the experience, it may be difficult to keep them. Trained IT professionals and Engineers., We know the technology. You have access to our technical and IT engineering experts
You own the hardware and software (apply depreciation) You don’t own the hardware