How Much Does A SharePoint License Cost?

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“How much does a SharePoint License Cost?” is a mystery question to a lot of people, and trust us it is actually a hard one to answer as well.

Although it is a very good question to ask when you are deciding to embark upon SharePoint as the new collaborative system for your enterprise, but unfortunately there is no single word answer for this. If you want to hear it short, we will only say, ‘It Varies’, because it does. Simply take the example of a car. It is just like asking how much does a car will cost? One may not answer, until he knows your choice and most importantly the features that you are seeking for. Similarly, SharePoint comes in various flavors aka versions, editions and environments that you can choose from according to your enterprise needs and requirements.

In this blog post, we are trying to provide you some good insights that can guide you in making a good decision about which SharePoint is the right one for you, and how much will its licensing will cost you. So, first let’s get started with getting a good understanding of the SharePoint versions available in the market to better understand its license cost.

SharePoint & Its Versions

SharePoint was first released by the Microsoft in 2001, and since then the world has seen its amazing evolution. To put it lightly, a lot has changed in SharePoint since then. Microsoft released successful SharePoint version in 2001, 2003, 2007, 2010, 2013, 2016, and then in 2019. SharePoint 2001 was a single server-free product, then came the releases of 2003 and 2007 were the ‘farm’ productions. Farm is basically referred to the bunch of servers that are working together to serve a particular function, for instance delivering SharePoint service. In terms of cost, you can understand it in a way that the larger the farm or the number of servers, the higher will be your cost.

Another question associated to this is that how many farms do you need in a farm? This is the question which actually adds the complexity to the cost. Then comes the ‘Hosted Farms’ that are fully managed by the third-party service providers or hosting vendors. And now, Office 365 and SharePoint Online has also been launched that are being offered against monthly licensing fees for users. Adding up to your confusion, even the pricing and packages within Office 365 also vary.

We know it sound so crazy, so let’s break down this craziness into easy, understandable options.

Option # 1 – On-Premise / In-House SharePoint

On-premise and in-house SharePoint are the same thing. In simple words, it means that you have your data center located somewhere within your office building and even under your workstation (which is obviously not recommended). This only means that in the on-premise SharePoint settings, you only buy a server, get it installed and configure your desired version of SharePoint in it; and That’s it! The costs involved here include the following;

  • SharePoint Foundation License = Free.
  • Standard CAL (Client Access License) = $180/License.
  • Enterprise CAL (Client Access License) = $90/License (One-Time Purchase).
  • SharePoint Server License = $5k Per Virtual Machine/Server.

 

Note: A Client means A Single User, which means each user represent 1 CAL.

This is the fundamental menu which you can use to calculate your total SharePoint cost. For instance, you choose SharePoint Foundation, which means that you won’t pay any amount for the license, since its free and infinite number of users can use it. Likewise, if you will choose SharePoint Server, you will be asked the number of severs you will be requiring in your farm. Minimum number of servers you can opt for is 1. However, if you want an upgraded or better scale performance, then we recommend you to go for more. So let’s support you choose 4 servers, then your cost will be S5k*4 = $20k ($20,000).

On the crest of this, comes the cost of per user licensing or user-based licensing. For example, suppose you have 100 users within your enterprise (means there will be 100 people accessing the SharePoint services), the total of your cost for CALs will be $180*100= $ 18,000 (for 100 users).

Combining both the costs i.e. SharePoint Server (for 4 farms) + CALs Cost (for 100 users) = $20,000+$18000 = $38,000.

Note: Remember that these costs are only for SharePoint Licensing and does not include any Hardware Cost, Operational Cost, Disaster Recovery Cost or Setup Cost etc.

Option # 2 – Office 365 / SharePoint Online Cost

This is another options offered by Microsoft for SharePoint, and it is mainly for shared environment. In this option, SharePoint Foundation is not offered and the prices are charged per user. Your costs in this option will be;

  • SharePoint Online Plan # 1 = $5 Per User/Month.
  • SharePoint Online Plan # 2 = $8 Per User/Month.


Note:
Price difference is for the number of features offered.

Options # 3 – Managed & Hosted SharePoint

Getting your SharePoint managed and hosted by a third-party service provider is one of the best idea. It not only gives you a hassle-free installation and management, but also provide you with specialized skills and expertise within the area. That’s not it. It also provides you complete security and full-control over your data base just like the on-premise settings. However, the costs associated to this options tends to vary from vendor to vendor.

Associated Hidden Costs

SharePoint licensing cost can be predicted, however knowing these listed costs is not enough for making smart CIO/IT level decisions; because you need to consider all the other associated and hidden costs as well. SharePoint is very powerful tool which is evolving into a multi-server, classified, multiservice ecosystem; hence it requires diligent care and robust management. Some supplementary costs that may be associated include the following;

  • Hardware Cost.
  • IT SharePoint Administrator.
  • Offsite Backup/Disaster Recovery.
  • SQL Licenses.
  • Third-Party Add-Ons.
  • Management Tools.

 

Get Experts’ Help

SharePoint can be complicated and confusing and it is a one-time show, so you need to make wise decision. Code Creators – a leading name in the market when it comes to SharePoint development and migration services, offer free consultation with its experts that can guide you through making best decision for your business. Click here to get connected.

Conclusion

SharePoint could be pricey or affordable. You need to consider your trade-offs and options and should research about the areas that may help in adding up or reducing SharePoint costs. Also check with the vendors for pricing, because their prices for licenses may also differ, depending on their agreement with the Microsoft. Talk and consult with your vendor to find out the best value.