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So you’ve crunched the numbers and decided that migrating to Microsoft 365 is the right choice for your business. This is a smart move considering that investing in Microsoft 365 can lead to reduced hardware costs and greater productivity. However, as you start price shopping and planning the move to Microsoft 365, you may quickly discover that the amount you had budgeted for this move does not cover the actual cost of migrating to Microsoft 365. This can leave you confused and wondering what you are missing when estimating the cost of a Microsoft 365 migration.
The fact is that it’s easy to misjudge the size and complexity of migrating to Microsoft 365. When pricing your Microsoft 365 migration, numerous factors such as the number of users, mailboxes, and devices that your organization has can affect the overall cost of the move. To help you more accurately estimate how much a Microsoft 365 migration could cost your business, here is a look at some of the most common factors that could affect your final bill:
7 Factors Influencing Your Microsoft 365 Migration Cost
1. Mailboxes
One of the biggest factors that will affect the cost of your Microsoft 365 migration is the number of mailboxes that you have. As a general rule, the more mailboxes you have, the lower the price per mailbox you will pay for the migration.
This is because most cloud migration companies price projects on a sliding cost-per-mailbox scale. Migrating 10 mailboxes might start around $50-$100 each, then decrease as you add more mailboxes. However, it is important to note that every migration company prices mailboxes differently.
Three of the most popular Microsoft 365 mailbox pricing models that you might encounter include:
Higher Cost Per Mailbox to Account for Unforeseen Issues
Email migration can be complicated, especially if the migration specialist isn’t prepared. Some Microsoft 365 migration companies bake in extra costs into the price per mailbox to cover those unexpected roadblocks.
Low Cost Per Mailbox but Inevitable Change Orders
Other migration companies offer a lower cost per mailbox, but tack on costly change orders every time a new challenge arises. This can seriously inflate the total migration cost and cause lengthy project delays. Alternatively, a migration company might charge less per mailbox because they don’t offer critical project success factors like user training and change management. However, switching from legacy systems to a cloud platform like Microsoft 365 will completely change the way your employees work — from where and how they access email to the policies in place. User and admin training is a must-have for your project if you want to ensure that this transition is a success.
Time and Materials Estimate
Some migration companies use T&M pricing and provide time estimates per mailbox. Unfortunately, in these cases, the actual project cost rarely matches the initial price estimate. This can put you in a dangerous position if migration issues come up that cause the migration to take longer.
This is why it is essential that you find out what pricing model a prospective migration company uses and that you ask about their project roadmap and how they plan for unanticipated issues (because they will arise). Knowing how the company charges for its services can ensure that you know what you are signing up for, which can help you more accurately estimate your migration costs, preventing any potential surprises later on.
2. Archives
When migrating to Microsoft 365, you’ll likely have archives mailboxes left over from past employees. However, in most cases, Microsoft treats archived mailboxes like separate mailboxes and requires licenses to migrate them to Microsoft 365. This can significantly elevate the total cost of a migration, which is something many businesses are not prepared for. This makes it important that you account for any archived mailboxes you have when estimating the cost of your migration to prevent any potential surprises.
Compare Microsoft 365 licenses here to learn more about your options.
3. Public Folders
If you’re using on-premises Exchange, you likely have public folders that you use to share mail, calendars, contacts, and distribution lists across specific groups in your company. However, migrating public folders in a Microsoft 365 migration is a tedious, manual process that will increase your migration costs. Furthermore, what many businesses do not realize is that you still have to purchase a license for these public folders, which will further increase the price of your migration. Prices are based on 10 GB of data, so migration costs can get expensive if the data in each folder exceeds this limit.
4. Compliance Issues
If you comply with legal hold policies, you’ll need to preserve and migrate more data than a typical company.
For instance, regulatory compliance might require you to archive and migrate all ex-employee mailboxes to the cloud — even if they’re no longer in use. Unfortunately, these extra mailboxes can increase your Microsoft 365 migration cost.
If you are like many organizations that deal with regulatory compliance, you may over-preserve data to avoid potential legal issues. Fortunately, if you invest in a comprehensive Microsoft 365 migration service, your migration specialist can help you evaluate your storage processes and determine what you can delete to cut down migration costs.
5. Migration Source Location
Where you’re migrating from can also affect the cost of your migration to Microsoft 365. If you’re coming from an older version of on-premises Exchange (2010 and below), you’ll have to upgrade before migrating to Microsoft 365. This involves an extra step and cost to migrate to Microsoft 365.
Moving from outside email servers typically requires a migration tool that you’ll also need to budget for. These additional expenses can add up and are not something most companies think to include when initially estimating the cost to migrate to Microsoft 365
6. Identity Integration
When migrating to Microsoft 365, you’ll need to consider how user identities will sync with the cloud, as this can affect the cost of your migration. Cloud migration companies often overlook the complexity involved in integrating identities, which could lead to unexpected costs.
You have a few options for identity integration when migrating to Microsoft 365. The first is to transition identities to the cloud using Microsoft Entra ID as the identity source for your organization. You could also use on-premises Active Directory and sync identities to Microsoft Entra ID using the Microsoft Entra Connect Sync service.
Syncing identities also becomes more complicated and costly when you have:
- A multi-forest setup
- Multiple organizations involved in the migration
- Identities in different locations
- No mail attributes
- A different UPN and email address
7. Email Domains
There are a number of reasons why an organization might have multiple email domains. For instance, if you’ve recently acquired another organization, each company could have its own email domain. However, it is important to bear in mind that this will increase the cost of your migration, as cloud migration companies charge extra for multiple email domains. This is because each domain requires its own set of unique, independent processes.
If you have multiple companies within your organization with separate email domains, you will need to factor this additional cost into your budget for your migration to Microsoft 365.
How Agile IT can help
As you can see, estimating your Microsoft 365 migration cost isn’t always straightforward, and many additional factors not discussed here could affect your final bill. When evaluating Microsoft 365 service providers, make sure that they’ve accounted for the issues above and offer migration support and change management to seamlessly transition your company to the platform.
Looking for trusted assistance for your Microsoft 365 migration? Contact Agile IT today for a free quote.
Agile IT has performed thousands of Microsoft 365 migrations with 100 percent success. Our project discovery process and detailed project roadmap account for virtually every migration misstep possible. That’s why we’re able to offer fixed-price migrations, which include change management, training, and 60-day support. This not only ensures that you don’t encounter any unexpected charges, but it will also make this transition as easy as possible for you and your team.
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Sales@AgileIT.com