By now we have all heard about the promise of saas software and have heard from cloud infrastructure vendors how it will help businesses save millions of $s per year.  MangoSpring as a company is an online software business and have been using virtualized environments (from OpenVZ to VmWare to EC2) for over 3 years now. However, we don’t do it because it provides us with cost savings (it actually costs us more on an on-going basis to run our services on EC2 etc.). We do it because of all the other benefits saas software offers – capex vs opex, entry cost, reporting and scalability.  When I talk to CIOs across companies, they all echo similar views.  Most CIOs today are convinced, rightfully so, that cloud is the way to go for at-least a portion of their IT needs, but are skeptical about cost savings claims.

It is easy to see why!  When you dig a little deeper into cloud computing and start understanding all the fine print and all the new management software you need to buy, you start to get a picture that is as cloudy as the cloud itself.  For example, recently Apprio announced a $1m cloud savings challenge.  But you should look closely at the conditions that challenge comes with. I would suspect that any business that meets those conditions can easily find service providers who could provide them with even greater savings if they could define their own rules for on-premise installations.

So, the jury is still out on whether cloud will save you a dime or not.  However, here is a sure shot way to cut your IT costs in half – move to MangoApps!  The table below highlights the details:

Now that’s savings you can count on and take to the bank!  Of course these cost-savings are just part of the story and completely ignores the most important point around MangoApps–because of MangoApps’s integrated approach to collaboration tools, our customers will see multiplicative effects that siloed software can never provide. We believe this integrated approach will result in the next big leap in employee productivity. It is early for us to share concrete numbers around productivity gains at this time, but we will do so when we have collected enough data and have permission from our customers to do so.

*While calculating these costs we tried to be as conservative as possible and tried to compare Apples to Apples and didn’t take the outliers into account (for e.g. the project management applications that cost $600 – $800/year).