US email outsourcing reaches UK

US-modelled hosted email packages have emerged in the UK which offer 99.9 per cent email uptime, via virtual private networks, for messages to and from desktops and mobile devices at around £20 per user per month.

The offerings are aimed at small companies for complete hosting, and large corporations wanting to extend their existing in-house email system to mobile devices.

Email has evolved from a quick message tool to a vital part of business transactions and communication. As it became business critical, demand for resilience increased, and it needed to fit in remote and mobile workers as well as identify and store important messages. It also needed enhanced security, as 90 per cent of viruses are spread through email.

David Nelson, senior industry analyst at Giga Information Group, said: "Businesses today cannot endure outages of their email systems." He recommended outsourcing some or all of a company's messaging. A survey of Giga's client base last November revealed that a third of companies considered outsourcing their message systems.

However, Alan McDonald, network services manager at Stirling Council, said the offering failed to convince him that email hosting could save money. He argued that outsourcing email traffic between 10 post offices and 100 remote locations via the internet would force him to expand his current 2Mb frame relay backbone.

"Hosted email might save money in the US, where 100Mb frame relay is cheap. But here, bandwidth is expensive," he said. "I guarantee message delivery via our internal infrastructure, but I cannot control the internet. When you have email downtime, people start moaning very quickly."

Reasons for outsourcing email:

• Cost savings - the hosting company gains economies of scale from serving multiple companies
• Avoids disruptive upgrades
• Focuses IT resources on revenue applications rather than emails
• Better wireless support - hosting companies offer email for a variety of devices
• Contractual service level agreement with penalties for under performance.

Reasons for in-house email:

• Internal emails stay on the company's network, which saves money on frame relay upgrades and guarantees better performance than the internet
• Many application service providers (ASPs) are unknown startups and need to be put through a rigorous assessment process
• While US email outsourcing is sold by telephone, European companies need to enter a direct relationship with the ASP.

See also:

Email outsourcing costs deter SMEs

Companies wary of ASP email model  22 Nov 2001

Outsourcing is a recession beater

Analyst sees market soaring to $175bn by 2005  21 Nov 2001

Legal Q&A - Employee email: know your rights

Employees have a right to know about their company's policy on the sending and receiving of private emails. And the onus is on employers to ensure that staff are aware that their email activity may be monitored.  25 Sep 2001

VARs combat ASP threat

IT expertise offers role for resellers in the ASP market.  25 Jul 2000

Giga claims European ASP survey is wrong

Researcher Giga Information Group has slammed a recent ASP Industry Consortium survey on Europe claiming that it is inaccurate.  27 May 2000

ASP Global gears up to profit from provision

Startup company ASP Global has claimed to be the only UK company actually making money from the ASP model, but not through providing services.  08 Mar 2000

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