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Conditions, constraints for building Exchange in Azure

Running Exchange in Azure doesn't compare favorably to Office 365, but it has valid instances where it might be useful. Consider costs and competitors first.

Microsoft runs Exchange Online in its data centers as part of Office 365, and it is now supported for IT pros to build out Exchange 2013 in Azure Infrastructure as a Service (IaaS).

Should they need to, admins can build VMs within the Azure service and install and manage Exchange the same as within an owned data center.

Requirements for Exchange in Azure

Running Exchange in Azure is similar to running Exchange in any other virtualized environment. The same recommendations from the Exchange 2013 Server Role Requirements Calculator apply.

In most implementations, Azure will require larger virtual machines than in other virtual Exchange environments. To satisfy the larger memory requirements, Azure Premium Storage is required for all disks hosting Exchange database and transaction logs, including transport databases.

In effect, the optimized D-series virtual machines, starting with DS11, which comes with two virtual CPUs and 14 GB of RAM, are the smallest suitable VMs for Exchange in Azure. For an Exchange Server hosting mailboxes consider DS12 and DS4, both with 28 GB.

In addition to optimized virtual machines and premium storage, you likely will need to configure VMs to run Active Directory domain controllers to support Exchange and networking components.

If you want external access, it will also require a number of static IPs and load balancing components.

VPN gateways are required to connect the virtual networks in each region together for high availability.

There is cost associated with the bandwidth that Exchange uses on Azure. Unlike inbound data to Azure -- which does not carry a charge -- outbound traffic, like OST downloads or database availability group (DAG) replication, will cost the organization.

If you require better connectivity to on-premises Exchange servers, then Azure ExpressRoute may be essential. A multiregion deployment might require the ExpressRoute premium offering – which allows multiple entry points into the Azure network -- to avoid traversing the internal WAN.

Finally, don't forget licensing. Although the Windows Server OS is licensed in Azure, you'll still need Exchange Server licenses and Client Access Licenses (CALs).

Exchange in Azure vs. Office 365

It's neither practical nor purposeful to perform a like-for-like comparison between Exchange in an Azure cloud and Office 365 -- primarily because not many organizations require 50 GB mailboxes per user.

These rough calculations work out Azure pricing:

  • 1,000 users with up to 10 GB mailboxes, sending and receiving up to 150 messages with an average size of 75 KB; and
  • Four database copies -- two per region using Exchange Native Data Protection.

This requires four Exchange VMs with at least 3 CPU cores each and 48 GB of RAM, with a total of about 58 TB of storage.

ExpressRoute and licensing costs aside, the Azure IaaS alone adds up to over $11,000 a month. Exchange Online Plan 1, in comparison, for 1,000 users costs $4 per user per month -- $4000 with no licensing costs, five times the amount of storage available and no server management required.

Uses for Exchange in Azure

Running Exchange in Azure isn't cheap, so when does it make sense to do so? Very few organizations can afford Exchange in Azure, and want the control of running in-cloud; not maintaining the physical hardware makes it a viable option.

Here are practical scenarios where it may make sense:

Exchange hybrid servers

If you migrate to Office 365 and want to remove the last Exchange Server from on-premises servers, you may be disappointed. If you use DirSync, Azure AD Sync or Azure AD Connect to synchronize your AD with Office 365, you have to manage the Exchange attributes from the local AD. For total support, you will need a Hybrid management server.

The Hybrid server doesn't necessarily need to be available on the Internet or route any mail; therefore, a DS11 size Azure VM will suffice, along with a basic VPN connection for less than $350 a month.

In-region data alongside Exchange Online

Each Office 365 tenant is tied to a single region. Email domains cannot be shared between tenants -- multiple tenants is therefore very troublesome. If you need to host mailboxes in the same region as a group of users for reasons such as regulatory compliance or latency, then Exchange in Azure can work.

Office 365 Enterprise plans include licensing for the CALs required when deploying Exchange. So if you license users in Office 365, you don't need to pay extra for licenses of those running on-premises (or Azure IaaS).

It might be economically viable to run a small number of mailboxes in the Azure IaaS environment: You get the benefit of on-premises Exchange, allowing email domains to be shared between Office 365 and your Azure Exchange environment and avoid the downsides of multiple tenants.

With Azure IaaS, you only pay for what you use, so running it for a few hours four to five days per month could cost around $100 monthly. If you do, just remember to switch it off when it isn't needed.

Test environment

You can also run Exchange in Azure for your test environment. Typically, you don't need Microsoft support for a lab or test environment and won't run production workloads, so you can forgo premium storage. A small four-node DAG with a couple of test mailboxes might cost under $2,000 per month to run full time, assuming licensing is covered by a MSDN subscription or trial licenses. However, since it is a test environment, and as such doesn't need to be running full time, it may cost a lot less.

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