There are a lot of pros and cons for both at all business sizes. But SMBs tend to be more price and administration sensitive. In other words, if you are a company that has an annual IT budget from $10,000 to $100,000, you simply can not go out and buy an email archiving system that costs a million. It's just not going to happen.
Similarly, if you're an IT organization that has three or five or eight people, you're not going to have the manpower and the resources to effectively implement email archiving, which is admittedly fairly tricky to get right. Really, you need to think about how you are going to be able to balance your financial abilities and your staffing abilities with your needs.
For a lot of people, especially in the SMB market, an outsourced solution is a way to meet the needs without having to hire another person or spend hundreds of thousands of dollars more than you needed. A lot of the time, these outsourced solutions can be bought on a pay-as-you go basis where you pay per user, per mailbox, per gigabyte or per month. A lot of them have low or even or no setup fees, which again, is another big concern. If you have to go out and buy a whole bunch of hardware and software just to get started, then it's going to be really difficult to get approval for that. Whereas if you can just put it in as an operational expense that is growing over time, it is much easier to get approved.
But of course, it does grow over time. Once you make the transition from being a small business to a midsized business, companies start asking themselves if this is really what they want to spend there money on. It's easy to see this as money going down the drain, which of course it's not because you're probably getting an effective solution. You're continually putting money in there every single month and it might not be a highly visible return you're getting. So a lot of folks as they get bigger start thinking about in-house archiving.
The ironic thing is that the very biggest companies are eagerly and actively outsourcing this function. So even the ones that could afford to buy their own hardware and software and staff with a dozen people, a lot of them are really interested in outsourcing, too.
So a managed service is not necessarily just a small business or a big business solution, it is a potential solution for anybody that doesn't feel like this is something that they want to invest in. Whereas an in-house solution is exactly the opposite, where you have the staff and you have the money and you say this is not something that I want to pour money into every month. You want to be able to buy something, get it up and running and own it.
While those are really the main considerations, there are others, such as security. But most people find it comes down to money and power.
Check out the entire Email Archiving FAQ.