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Information Technology (IT) Budget: Convert to a Per User Price

June 17, 2017

When a small business assesses the best use of their IT budget, the most efficient way is to determine the monthly price per user. Why? The “price per user” structure is where things are headed for cloud computing. Think about your smart phone.  You already pay a price per user for the hardware, software, data, and phone service.  Very large companies already leverage cloud computing to take advantage of efficiencies gained by sharing and reallocating resources when needed.  The major advantage to cloud computing is that you are sharing a utility service amongst many users and can simplify billing to a per user pricing structure.  (This is how you alleviate surprise charges that are already accounted for in your monthly pricing.  The maintenance costs are spread out to each user account for efficiency)

 

Case Study:  a small law firm knew that they needed a technology refresh. (Their servers, desktops, switch, and wireless was outdated)  Simultaneously they chose a new billing platform for their business which was needed for their expansion.  Incidentally their current team has been waiting for quite some time to have an efficient system.  It was quite apparent that they all needed new workstations with enough memory and resources to run their new system.  They needed new workstations and pretty much everything in their server close had to be upgraded.

 

Faced with the daunting task of bankrolling this technology refresh, the leadership team decided to assess their entire technology budget to decide the best direction for their firm. Here is what their IT budget looked like:

 

  • They have 12 employees and three servers. They have one office and 3 of their users have remote access.

  • For IT support over the past 12 months they spent $ 9700 on support labor with their IT service provider. (One of their users had a virus which required $ 1400.00 in repairs)

  • They spent $9600.00 for Internet service over the past 12 months.

  • They spent $ 1400.00 in offsite backups. They spent $ 400.00 for anti-virus software.

  • They had to buy one workstation that had crashed and it cost $ 1400.00.

  • They bought a new switch for their server rack and new wireless (WAP) for an additional $ 850.00.

 

For the last 12 months they spent a total of $23,350  to support their 12 employees which converted to a per user price is $162 per user per month.  Keep in mind they need all new equipment, new servers, workstations, and software. The projected upgrade costs for this will be about  $48,000.

This will not include the ongoing support, maintenance, additional users and all of those associated costs as well.   If the upgraded system lasts 5 years then we can convert this into a monthly per user price.  In addition we have to include support and maintenance costs which will run about $14,000 for five years.   So the per user price for is $86.00 per month per user.

 

Take last year’s support costs at $162 per user and add the per user costs for the upgrade then your new per user price is $248 per user per month. This price is assuming that no big changes occur and that there are no viral attacks, security issues, or big expansion plans occurring within the next five years.  Realistically they should budget $280.00 per user per month to cover any surprises.

 

By choosing NthaCloud, this firm could bypass outdated technology solutions and fast forward to a comprehensive cloud solution for $200 per user per month. Keep in mind that this per user price includes their internet bill.  There will not be a separate internet bill any longer.  This monthly per user price includes all of the functionality listed above plus unlimited support.  Also apparent are the other benefits of cloud computing.  For example, what if you needed to hire two more employees?  Just add them to your account. Then, before you know it, two new workstations will arrive at your office ready for installation at no additional cost.  The e mail accounts for the new hires are added and their file access and applications are installed on their desktop per your requirements.  Are you starting to see why moving your system to the cloud makes dollars and cents and sense for your business?

 

If something breaks, the repairs are included in your monthly per user pricing.  If you need to add an application, it is just a matter of providing the specifics.  Your per user price stays the same.  No additional bills are generated for migration labor or setting up new servers or adding Ram and memory.  No offsite backup accounts to pay for.  The security is already included in your price per user.   Done.

 

Contact sales support today at NthaCloud.com for a free no obligation assessment.

 

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If you would like to download our free Executive Guide addressing Technology Labor Shortages, click here.

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kevin@nthacloud.com
303.565.7261
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