Neil Barton

Wednesday, October 28, 2009

$4 per mailbox per month for Gmail?

Loads of reports in the blogosphere about a decision at LA City Council to outsource their mail system to Google. But what did they pay? And what did they get?

The L.A Times reports it was a $7.25 million contract.

According to a comment on the article (from Karl, Oct 27th, 8.46pm), it's a five year contract.

That's an average $1.45m per year, or $120,833 per month.

If they provide email for all 30,000 of the LA City Council's employees, then they are charging $4.02 per mailbox per month.

This is an important number, since the media are portraying this contract as the result of a ding-dong battle between old-fashioned Microsoft Exchange mail and new-fangled Google cloud computing. It's reasonable that at the end of such a slug-fest, a new low-water mark for pricing would have been set.



There's a number of thinks to be very careful about in this calculation.

1. One of the prime motivations seems to have been not cost, but reliability. The city are replacing an ageing Novell email system which has been reported as highly unreliable.

2. Very reasonably, some departments, such as the LAPD, have expressed concern about the security of the data in their emails. A fascinating paper published by the City Clerk describes the "extras" that LAPD are getting over and above a regular cloud computing email - dedicated servers, data striped across multiple servers, no single administrator having access to the whole.

3. CSC are involved in over-seeing the whole thing - presumably as prime contractor.

4. Some reports suggest that, while the council has 30,000 employees, only 17,000 of them are getting the new email system. That would mean the price was nearer to $7 per mailbox per month.