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Ok so I use MailEnable Enterprise 3.0 and am quite happy with it.
It can send and receive mail, filter spam, unlimited accounts, scan for a virus, etc etc etc.
And I only paid $700 for it.

Im sure the same thing could be said for SmarterMail and all of it's features

So what's so great about Microsoft Exchange?  I just did a quick search on Ebay and found that it would cost almost $5000 for 25 users to have access to the mail server... doesn't that sound outrageous compared to the above specs?

http://cgi.ebay.ca/MS-Microsoft-Exchange-Server-Enterprise-2003-25-CAL_W0QQitemZ150191330908QQihZ005QQcategoryZ3770QQssPageNameZWDVWQQrdZ1QQcmdZViewItem

You don't need to have retail version of Exchange in order to do Exchange hosting

You just need to be at least Microsoft registered member and have SPLA (Service Provider License Agreement) signed. Then you can provide any Microsoft software to your customers as a service. You'll get very attractive monthly prices on all Microsoft products. Some products offer Processor Licenses (PL) only, some Client Access Licenses (CAL) and some both of them (PL and CAL). For example each basic Exchange mailbox would cost you $5/month (but it depends on your region and SPLA provider organization).

Read more about SPLA: http://www.microsoft.com/serviceproviders/licensing/default.mspx

...Exchange/SharePoint hosting today is very attractive pie and DNP has everything required to help you start it.

But even your Exchange module is a substantial chunk of coin.  and i am guessing it is not included in the Gold License.

also, DNP does not allow for "per account" billing so i would have to sell a package with a single exchange email account and then sell add-on's for additional accounts.  otherwise i could potentially be paying for accounts that the user is not using.

Yep you are right, Exchange is expensive.  I have it running in my office for local email but use MailEnable 2.0 for our clients.  I don't really like Exchange that much nor do I like Small Business Server as it's the slowest running Server OS I have ever seen.  Running a Pentium D 3.2 with 2GB of Ram and it still takes forever to load up and run. 

If you like the cost of Exchange, try running Microsoft SQL Enterprise Edition, with Unlimited Licenses.  How about 18k ? 

Or for that matter, the program I was using before MailEnable which was Imail (Ipswitch). Cost a hugh chunk of money and had a security hole the size of Texas. 

 If you setup your company with all the greatest and latest software that Microsoft offers...you would be close to 100,000 in debt lol.

In Europe we sell Hosted Exchange mail accounts at 15 usd/m each. Sure thats cheap! If Microsoft do not lower their prices, they will loose in the long run to companies like Smartertools who just released v5:

"SmarterMail 5.x is the Cost-effective Alternative to Microsoft Exchange™ for businesses and ISP/Hosting environments."

"The complete Collaboration features within the Enterprise edition make SmarterMail the smart alternative to Microsoft Exchange™ for those requiring Synchronization with Pocket PC, Smartphones, and Microsoft Outlook™."

In short, its great to see SMB SAAS Systems Inc. (former Dotnetpanel Software) support Microsoft products like Hosted Exchange as it is currently a "trend" (an expensive one) and they can easily be sold, but I would rather have SMB focus on fully integrating SmarterMail, MailEnable and other cost effective mail products. Indeed Exchange is a good product but this SaaS (Software as a Service) idea is not cheap for end users. As companies we do not complain at all as long as we can sell the products. But for how long can Exchange accounts be sold? Do you believe in Exchange and its price model? I dont...

 I agree with you a lot. Instead of purchasing Microsoft Exchange licenses I went the other route and got SmarterMail v5 Ent. licenses. People love SmarterMail and it's clean look. Microsoft will need to reduce prices on more than just one product to compete against other great products and the open source world.

Exchange is a common household name that business owners have heard of and just the fact that it has the word Microsoft in front makes it more appealing to business owners.  Since Exchange is so popular in the IT industry you can fix just about any problem just by typing in the error message in the search box at your local google interface :-)  You have to look at the pros and cons of all the vendors out there for full service email software and make your own decisions.  I love Exchange and it has been a very good tool for our business and for our customers.

Frank

Sorry for jumping in like this as a newbie on this forum, but I think some of what has been said here requires a comment or two.

First, there's a lot more to running a communication system than just software investment cost. In addition, Exchange is not just popular because a lot of business owners have heard about it, it's popular because it excels in virtually every IT area contributing to TCO, compared to other products (scalability, security, reliability, administration, integration, usability, accessibility). Can Exchange get pricey in larger deployments? Absolutly. Is Exchange the right tool for "just a couple of POP mailboxes"? Absolutly not. Bottom line is, you get what you pay for. This has nothing to do with percieved views of products or vendors, this is a well established product (more than 10 years) that has an extremly large infrastructure surrounding it. That's why business owners choose it - if there was something with a lower TCO that would supply the same features (by that I mean all the above mentioned), I am convinced businesses would go for it (example: the shift from Domino to Exchange - Domino used to be the market leader).

Aside from that, the startup costs for an Exchange Hoster (Software only) are around $60 (ca. $30 each for a Windows and an Exchange CD through SPLA). The rest is billed on a monthly usage basis.

Rgds,
Marcus.