Does Third Party Hosting for SharePoint 2010 Make Sense?

By Jay Atkinson
AIS Network CEO

Third Party Hosting for SharePoint 2010
Should you host your SharePoint 2010 in the cloud?

“To cloud or not to cloud?” is rapidly emerging as the technical question of the decade.

Industry analyst Gartner, Inc., expects 43 percent of companies to have most of their IT efforts running in the cloud in as little as four years. Due to that expected boom in cloud adoption, Gartner ranks cloud computing as the No. 1 tech priority for chief information officers.

Placing a mission-critical platform into the hands of an independent, third-party hosting services provider can uniquely position that

organization to combine some of the best elements of on-premise hosting and Office 365 delivery. For many organizations, SharePoint is mission critical and the decision to shift from on-premise hosting to third-party hosting is not entered into lightly. However, the benefits of doing so are increasingly appealing. In comparison to on-premise hosting, third-party hosting offers superior flexibility, greater reliability and a better value.

Why a better value? Ultimately, if an organization were to attempt to replicate the hosting infrastructure built by a third-party provider, it would become abundantly clear to that organization that outsourcing to a third party provides a much better value. It is usually cheaper for an organization to host SharePoint on-premise – unless they want to do it right. Replicating an on-site infrastructure that equals the performance, reliability, scalability, security and compliance environment that “comes standard” with a solid, Microsoft hosting partner’s services would be cost prohibitive.

Here, it is also important to note that for public companies or others that are audited, Sarbanes-Oxley (SOX) also drives the case for outsourced hosting. SOX identified the Type II SAS 70 report (today’s equivalent is SSAE 16 Type II) as the only acceptable method for a third party to assure a service organization’s controls. Many reputable hosting companies are SSAE 16 Type II-audited, which means the audit of the hosting company can be incorporated into the audit of the public company. Relying on the audit performed on a third-party hosting company, at the hosting company’s cost, may be much more cost-effective than ensuring your own facilities and processes are SSAE 16-compliant.

Hosted SharePoint Specialists

Organizations contemplating a SharePoint deployment should recognize that there are applications hosting providers and then there are a handful of hosting providers that specialize in hosted SharePoint. Many have Microsoft and additional compliance certifications, and that enhanced capability and level of service may be imperative to an organization requiring customized SharePoint hosting configurations, Microsoft-certified talent, and top-grade security and disaster compliance.

The hosting provider’s infrastructure is supported by many clients, thus enabling it to deliver a broad range of services at a substantially lower price (than managing identical services on-premise).

For the customer, there is little upfront capital expense and the monthly payments to the hosting company are predictable operational expenses. The IT staff is freed up from spending precious resources and time on designing its own hosting solution architecture. Stressing about managing backups, software licenses, hardware/software upgrades, and patching schedules is all in the hands of seasoned hosting experts who monitor the customer’s SharePoint solution in a disaster-resistant data center.

In addition to cloud hosting services, there are two general types of SharePoint hosting that a third-party provider may offer:

  • Shared hosting. An organization’s applications and data are deployed on a server that is shared by several other organizations.
  • Dedicated hosting. An organization either deploys its own servers or the hosting provider deploys servers dedicated for exclusive use by that organization. Dedicated hosting may be provided by either dedicated physical servers or dedicated virtual servers.

Benefits and Drawbacks of Third-Party Hosting
A SharePoint hosting provider frees up an organization’s entire IT staff to focus on tasks that will help grow their business. In their Service Level Agreements, most top-tier hosting providers offer disaster-resistant data centers, temperature and access controls, 24x7x365 monitoring and response, excellent connectivity, reliable uptime and availability, managed hardware/software upgrades and maintenance, routine backups and fail-over capability in the event of disaster.

The best providers develop a solid, personalized relationship with each customer, listening carefully to their needs and integrating their team of experts into the organization’s IT staff.

Benefits include the following:

  • Customization. The hosting provider is capable of configuring highly complex SharePoint installations.
  • Low upfront costs. Capital outlays are minimized. Outsourced hosting becomes an operational expense. The hosting provider typically buys and manages the servers and provides the licenses.
  • Staff. Highly trained hosting experts strive to integrate seamlessly with an organization’s team, thus helping to strengthen the relationship through personalized service.
  • Security. An organization’s servers are typically highly secured, backed up and sitting in a disaster-resistant data center. Many providers have SSAE 16 Type II designations as well as other compliance certifications.
  • Scalable. Spikes in traffic can be sustained without the accompanying worry that the organization’s network will crash.

Drawbacks include the following:

  • Portability. SharePoint hosting is complex, and organizations must enter into long-term contractual commitments with their hosting provider. Switching providers in mid-contract, or reverting back to self-hosting, is not easy and the process of migrating data to a new hosting arrangement can be onerous.
  • Slower deployments. Deploying the physical infrastructure is managed and thus not as turn-key as cloud-based hosting.

In addition to cloud hosting services already addressed by this paper, there are two general types of SharePoint hosting that a third-party provider may offer:

  • Change management. Changes – either hardware or software – to the SharePoint configuration may require the hosting provider’s review and approval, so organizations must plan in advance.
  • Flexibility. While third-party hosting may not recreate the level of flexibility associated with on-premise hosting, in most cases, the degree to which an organization loses out on flexibility and control is less than the degree by which it will save on capital outlays.

Just as with on-premise hosting, there is a large emphasis on customization and flexibility in the world of third-party hosting providers. An organization will have full access to its own SharePoint environment – the way it should be – and any kind of software application that compliments its SharePoint (customer relationship management software, data mining programs, etc.) can be integrated.

Have more questions about hosting SharePoint in the cloud? Contact us today.