Does self-hosting Microsoft 365 workloads cost less?
Renewal notices and licensing changes are usually what bring a buyer here, and the honest answer is that self-hosting shifts cost from a per-user subscription to infrastructure, implementation and operations. It tends to win at scale or where data residency is a hard requirement, and it rarely wins on a small tenant with a short horizon. Microsoft's prices are not supplied here, so pull the per-user rates, any E3 or E5 add-ons and the eDiscovery export entitlement from your own agreement before comparing anything. Note that Microsoft Purview eDiscovery export requires an E3 or E5 license, so that line item only disappears if you stop needing that export capability at all.
On the open-source side, Nextcloud Hub is free to self-host, but Nextcloud Enterprise is sold in Standard, Premium and Ultimate tiers with a 100-user minimum, with list prices starting at 71.29, 104.99 and 204.75 euros per user per year respectively for 100 or more users. Collabora Business is listed at 3 euros per user per month for up to 99 users. For openDesk, ZenDiS recommends the Enterprise Edition for production, sold as SaaS or for on-premises installation, so ask for a written openDesk Enterprise quote covering support tiers and patches. Licence-free core software does not mean zero cost: you pay for Kubernetes capacity, the external PostgreSQL, MariaDB, Redis, SMTP relay, ClamAV and object storage that production openDesk expects, staff time for upgrades, backups and monitoring, and the migration project itself.
Which cost components change between the two models?
This table compares each cost component of a Microsoft 365 subscription with the matching component of a self-hosted openDesk or Nextcloud stack, and marks whether each cost is one-time or recurring. Read it as a checklist for a quote request: the commercial side is paid to Microsoft per license, while the self-hosted side moves cost into infrastructure, subscriptions, and people. Most of the difference comes from recurring operations and internal skills, not from software license fees.
| Cost component | Microsoft 365 side | Self-hosted side (openDesk or Nextcloud) | One-time or recurring |
|---|---|---|---|
| Software license or subscription | Per-user Microsoft 365 plan; confirm the SKU covering Exchange Online, SharePoint and Teams | Open-source core is free to use; Nextcloud Enterprise or openDesk Enterprise subscriptions are optional and priced per user or per agreement | Recurring |
| eDiscovery export capability | Purview eDiscovery export requires an E3 or E5 license; confirm which tier your mailboxes and sites need | No license needed for export; export tooling and retention workflows must be built or configured by your team or partner | Recurring (license) or one-time (build) |
| Office document editing | Desktop Office apps and web apps included in plan; confirm add-ons needed for your users | Collabora Online editions: CODE is free but not recommended for production; Business and Enterprise plans carry support and signed security updates | Recurring |
| Infrastructure and Kubernetes cluster | Included in the cloud service; no tenant hosting cost to the buyer | Compute, storage, and a CNCF-certified Kubernetes cluster at v1.33 or later for openDesk; sizing depends on users and Collabora replicas | Recurring (hosting) plus one-time (build) |
| Storage | Included per-user storage within the plan; overage terms should be confirmed | Object storage, block volumes and backup targets you provision and pay for; growth is your responsibility | Recurring |
| SMTP relay and malware scanning | Handled by the Microsoft service | SMTP relay and ClamAV over ICAP are external services you must supply for production openDesk; Nextcloud All-in-One bundles ClamAV | Recurring |
| Implementation and migration | Tenant setup and export work by internal staff or partners; eDiscovery exports expire after 14 days | Planning, deployment, configuration, identity integration and data migration; usually a fixed-scope, one-time project | One-time |
| Support, upgrades and internal skills | Microsoft support tiers and internal admin time for licensing and policy | Upgrade cadence: Nextcloud requires one major version at a time; openDesk expects tracked minor releases; plus staff or retained support and continuous testing | Recurring |
What moves the cost comparison most
Microsoft 365 is priced per user, while self-hosted openDesk or Nextcloud costs follow infrastructure, subscriptions and staff time. The six drivers below decide where the balance lands, and each one shifts the comparison in a direction you can check before you request a quote.
User count and tier minimums
Nextcloud Enterprise has a 100-user minimum, and the Collabora Online Business plan covers up to 99 users, so the headcount band you fall into changes which subscriptions you can buy at all. Below 100 users, the Nextcloud One managed hosting option may fit better than a self-managed Enterprise contract, and at 100 or more users Collabora moves to a quoted Enterprise plan. Confirm your exact seat count, growth plan and whether you need volume discounts before you compare totals.
Data volume and storage backend
Storage growth drives the infrastructure line more than user count once mailboxes and document libraries grow. Ask what object or block storage you will provision, how fast it grows, and what replication and backup copies multiply it. Mail, file versions and retained eDiscovery exports all count toward the total, so model them separately from active files.
Edition choice for production
The community editions of Nextcloud and the free CODE edition of Collabora carry no license fee, but they do not include SLA-backed support or signed security updates. ZenDiS recommends openDesk Enterprise Edition for production, and Nextcloud Standard, Premium and Ultimate add support and maintenance tiers. Compare the subscription line with the staff hours you would otherwise spend on patching and vendor-less incident response.
Availability and replica sizing
High availability adds the most recurring infrastructure cost. Nextcloud Premium includes clustered instance support, and Collabora recommends manually set replicas because horizontal autoscaling breaks collaborative editing, with load balancers routing by the WOPISrc parameter. Each replica carries the production resource recommendation of 8 CPU cores and 8000 MiB of memory, with requests of 4 cores and 6000 MiB, so plan the number of replicas for peak editing sessions, not average use.
Compliance and eDiscovery export needs
Microsoft 365 eDiscovery export requires an E3 or E5 license, which adds to the per-user total if you need legal holds or exports on a schedule. Self-hosted systems do not carry that license line, but you must build retention, legal hold, export and audit logging yourself, and an independent auditor will assess the controls you run. Price the staff and tooling for those exports as recurring work, and ask any integrator to state the evidence it will deliver.
In-house Kubernetes and PHP skills
openDesk requires a CNCF-certified Kubernetes cluster at v1.33 or later, plus cert-manager, an ingress controller and Helmfile, while Nextcloud 35 needs PHP 8.5 and a supported database. Nextcloud also requires one-major-version-at-a-time upgrades with a backup before each one. If your team lacks these skills, budget for external implementation and support, which is the largest one-time line in most of these comparisons. Confirm the skill gap before you commit to a platform.
How to build the comparison with your own numbers
This sequence turns your current Microsoft 365 agreement into a like-for-like cost model, so each line of the comparison traces back to a figure from your own tenant or a written quote. Work through it in order, because later steps depend on the seat and feature inventory you build first.
Export seat counts and license SKUs
Pull the current subscription list from your Microsoft 365 admin center and your signed agreement, and record each SKU, its seat count, its billing term and its renewal date. Include guest accounts, shared mailboxes, service accounts and any add-ons such as eDiscovery or compliance licenses, because these are often missed. Confirm the total with your Microsoft account team or reseller so the figure matches what you are billed. The output is a single table with one row per SKU and a named source for every number.
Map workloads that need E3 or E5 features
For each SKU, list the workloads and features it enables, such as Purview eDiscovery export, advanced retention, audit or security features, and identify which business teams actually use them. Ask legal, compliance and security owners which exports and holds they have run in the last year and whether any are required by a regulator or an internal policy. Mark each feature as required, used but replaceable or unused. The output is a feature inventory that shows which users genuinely need the higher tier and which could sit on a lower plan.
Size storage from current tenant usage
Use the Microsoft 365 admin reports for mailbox, OneDrive and SharePoint storage, and record the current totals alongside the growth rate observed over the past year. Separate mail, personal files, team sites and archive data, since each lands on different storage in a self-hosted design. Add capacity for the object store or block volumes that Nextcloud, OX or openDesk will use, plus backup copies and version history. The output is a storage model with current size, projected size and the number of copies you plan to keep, each labeled with its source.
Price the cluster and the production footprint
Start from the openDesk evaluation minimum of 12 x64 CPU cores, 32 GB of RAM and more than 10 GB of disk, then note that the openDesk requirements expect production-grade external services such as PostgreSQL 15, MariaDB 10, Redis 7, Memcached, Cassandra, an SMTP relay, ClamAV over ICAP, object storage and a TURN server. Price the Kubernetes cluster, nodes, load balancers, backup target, monitoring and those services, using quotes from your infrastructure or cloud provider. Treat the evaluation footprint as a starting point for testing, not a production sizing. The output is a bill of materials with one-time and recurring lines.
Request written enterprise subscription quotes
Ask Nextcloud GmbH for Enterprise pricing against your user count, and confirm whether the 100-user minimum applies to your organization. For openDesk, ask ZenDiS or its partners for Enterprise Edition terms covering SLA-backed support and patches, SaaS or on-premises delivery. If you use Collabora Online for office editing, request the Business or Enterprise terms for your size, and ask what the SLA and signed security updates cover. Also ask OX about its deployment and support options. Each quote should state scope, term, user count and what renews. The output is a dated quote file per vendor that you can cite in the model.
Estimate migration and operations effort
Estimate the one-time migration work for mailboxes, files, sites and chat, including exports through Purview eDiscovery, cutover planning and user communication. Estimate the recurring operations work for patching, upgrades, backups, monitoring and on-call coverage, and name who in your team or in a services firm will do it. Note that Nextcloud requires upgrading one major version at a time with a backup before each upgrade, which shapes the operating effort. Record each estimate as an internal assumption, and ask any implementation partner to confirm it in a fixed-scope written proposal. The output is a labeled effort table split into one-time and recurring work.
Model three years with a parallel run
Build a three-year model that shows Microsoft 365 spend against self-hosted costs, with the parallel-run period as a separate line that carries both sets of licenses and infrastructure. Include renewal price changes, quote escalations and the cost of storage growth, and run a sensitivity check on user count and feature tiers. Confirm the Microsoft agreement end dates so that data deletion and export windows are not missed. The output is a model with its assumptions and sources listed, which your finance and security leads can review before any decision.
What the migration adds to the first year
The first year carries one-time migration work that runs alongside the subscription you still pay for. Start with the export. Purview eDiscovery can export Exchange mailbox items as PST or .msg files and SharePoint and OneDrive content as native documents with selectable version history, but exporting requires a Microsoft 365 E3 or E5 license, and search export packages expire 14 days after creation. Confirm that your tenant holds the right license before the project starts, and plan each export batch so that packages are downloaded and checked before they lapse. Ask your partner to define who runs the eDiscovery searches, who holds the exported data, and where it is stored during transit.
User sequencing is the second one-time cost. Mailboxes, sites and OneDrive folders should move in groups defined by department or shared ownership, not by whoever is ready first. Decide the cutover order for each workload, then set the date when Microsoft 365 stops being the system of record for that group. Keep the subscription active until every group has been verified in the target platform, because licenses and data retention on the source side set the real deadline. Running two platforms in parallel is the cost most often underestimated. Mail routing, calendar free/busy lookups, shared links and user accounts all need to work across both environments for a period, and that coexistence must be designed, tested and documented before the first user moves.
Recurring effort starts once the platform is live. openDesk releases are published as annual major versions, monthly minor versions and on-demand patches, only the latest minor version is supported, in-place upgrades between majors are not guaranteed, and skipping several minor versions may require intermediate steps. Nextcloud does not allow skipping major releases, so each upgrade moves one major version at a time, with a backup before every step and third-party apps disabled until confirmed compatible. Ask any partner for a written upgrade runbook, a staging environment that mirrors production, and an estimate of the upgrade calendar for the next 12 months. Those items belong in the quote, because they recur for the life of the platform.
Questions buyers ask about the cost of self-hosting
Is the self-hosted software itself free to use?
Yes, the core software carries no license fee. Nextcloud Hub is licensed under the AGPL and is free to self-host, and openDesk's deployment automation is licensed under Apache 2.0, with each bundled component keeping its own license, such as AGPL-3.0 for Nextcloud and MPL-2.0 for Collabora. Collabora Online is licensed under MPL-2.0, and its free CODE edition is positioned for testing, home use or small teams rather than production. The cost you still carry is infrastructure, staff time, and any subscription you choose. Confirm each component's license terms with the vendor before you build a budget, because bundled suites can include components under different terms.
What does an enterprise subscription add on top of open source?
An enterprise subscription buys support, maintenance lifecycles, security patches and additional features, not the core software. Nextcloud sells Standard, Premium and Ultimate tiers with a 100-user minimum, and the pricing page lists list prices starting at 71.29, 104.99 and 204.75 euros per user per year for 100 or more users. Standard includes one year of maintenance, Premium adds a lifecycle of five or more years and clustered instance support, and Ultimate adds support up to 24/7 with response times down to one hour. For openDesk, ZenDiS recommends the Enterprise Edition for production, adding SLA-backed second and third level support and patches. Collabora's Business plan is listed at 3 euros per user per month for up to 99 users. Ask each vendor for the exact scope and term in writing.
Can our own team run openDesk or Nextcloud without outside help?
It depends on the skills you already have and how much of the stack you want to operate. openDesk runs on Kubernetes with Helmfile and Helm, requires a CNCF-certified cluster at v1.33 or later, an ingress controller, cert-manager and an RWO volume provisioner, and expects production-grade PostgreSQL, Redis, object storage, an SMTP relay and ClamAV over ICAP. Nextcloud is simpler to start, but it requires one-major-version-at-a-time upgrades with backups before each step. Most teams combine internal platform staff with an implementation partner for the first deployment, then decide what to keep in-house. DeployOpen implements, hardens, backs up, upgrades and supports these platforms under fixed-scope agreements or retainers, so you can compare an internal build with a quoted scope.
How long does a migration take, and what drives the timeline?
The timeline depends mostly on the size of the data, the number of users, the workloads moving, and how many integrations must be rebuilt. Migration effort is driven by the export route, since Microsoft Purview eDiscovery exports require an E3 or E5 license, and search export packages expire 14 days after creation. Other drivers include identity federation with your directory, mailbox and document volume, custom Microsoft integrations, user communication, and the pilot cycle before cutover. No researched figure gives a universal duration, so ask any provider for a timeline tied to a written scope, with the assumptions for data volume and workloads stated in it. Confirm with the vendor how long your export and import will take in your own environment.
Which costs do teams forget when they compare self-hosting with Microsoft 365?
Teams most often overlook the cost of the underlying platform, the people who run it, and the work that happens after go-live. The main items are:
- Kubernetes clusters, load balancers, storage and backup capacity, plus the external services openDesk expects for production.
- Staff time for patching, monitoring, certificate renewal, and the one-major-version Nextcloud upgrade path.
- Collabora scaling constraints, since its Helm chart disables horizontal autoscaling and recommends 8 CPU cores and 8000 MiB of memory per pod for production.
- Support subscriptions, security testing, and periodic compliance evidence collection.
- Data export effort, and parallel running during cutover.
Ask each quote to list these items separately, so the comparison covers the whole operating cost.
When is Microsoft 365 still the cheaper option?
Microsoft 365 is often cheaper when the organization is small, already uses desktop Office apps heavily, and has no requirement for data residency, sovereignty or self-operation. Self-hosting carries fixed costs for infrastructure and staff that do not shrink with user count, so the break-even point depends on your user count, the components you need, and the skills you already employ. Consider the Microsoft option when the workloads you need are fully covered by your existing license and the operating burden would fall on a small team. Compare the total cost over your planning horizon, using each vendor's written terms, and confirm which Microsoft features you would lose, such as desktop Office apps, before deciding.
Does the eDiscovery export requirement change the migration budget?
It can, because exporting Exchange mailboxes and SharePoint or OneDrive content through Purview eDiscovery requires a Microsoft 365 E3 or E5 license. If your tenant is on a Business plan, you may need to budget for a license upgrade or find another export route for the duration of the move. Export packages expire 14 days after creation, so the export and the download must be scheduled and tracked. Ask your provider which export method they will use, what license your tenant needs, and how exported data will be validated and stored in your own environment before you approve the scope.
What a fixed-scope quote should include
A fixed-scope quote starts with a written list of what is in and out of the work. For a Microsoft 365 replacement, that list should name each workload being moved (mailboxes, OneDrive and SharePoint content, Teams chat history, calendars), the target components (openDesk or Nextcloud with Collabora Online and OX App Suite), the environments to be built (evaluation, staging, production, and any disaster recovery site), and the identity integration, including how directory users are provisioned. Each of these items maps to a cost line, so an unclear scope usually produces an unclear number. Ask for the scope to be written down before any price is discussed.
The scope should also set out migration waves, testing and handover. Waves define which user groups move first, how many mailboxes or sites each wave carries, and what rollback looks like if a wave fails. Testing should list the checks used for document fidelity between .docx, .xlsx and .pptx files and their originals, sharing permissions, and mail flow. Handover documentation should name the runbooks, backup and restore tests, and upgrade procedure the client keeps. Because a Nextcloud major version cannot be skipped during upgrades, the upgrade plan belongs in the scope, not in a later change request.
DeployOpen does not publish a price list. A quote follows from the written scope, so the reader should compare quotes on the same components, environments and waves. Ongoing support, upgrades and continuous testing are available as retainers, and those recurring costs should be quoted separately from the one-time build. Ask which items are fixed, which depend on the number of users or data volume, and which are excluded, such as licensing for Nextcloud Enterprise or Collabora Online Business, which are bought from the vendors directly.
How DeployOpen scopes a fixed-price implementation
DeployOpen plans, implements, integrates, hardens, documents and supports self-hosted open-source platforms inside your own infrastructure, so the cost comparison in this guide can be turned into a written scope. Most engagements are fixed-scope, with deliverables and timelines agreed in writing before work starts.
How we scope
- We start from your current Microsoft 365 licenses, add-ons and the workloads each one carries today.
- We record which users, mailboxes, sites and file volumes move, and which stay on the current service.
- The written scope names the target stack, whether openDesk or Nextcloud with Collabora and OX, and its hosting model.
- We ask you to confirm the infrastructure, identity source and data residency rules before any quote follows.
How we build
- We deploy the chosen platform into your cloud accounts, data centers or air-gapped network as agreed in scope.
- We integrate directory login, mail routing, backup, malware scanning and the office editing service with your environment.
- We run security testing of the deployed platform and record the findings and fixes in the project file.
- We set up the export and import steps for each workload so mailboxes and documents move in the agreed order.
How we hand over
- Handover includes configuration documentation, runbooks for upgrades and backups, and a record of the integration decisions.
- We prepare the controls and evidence your compliance team needs, while independent auditors perform any assessment.
- Your staff receive knowledge transfer on the operations tasks named in the scope before the project closes.
- Upgrade paths, including the one-major-version-at-a-time rule for Nextcloud, are written into the handover pack.
How we support
- Ongoing support, upgrades and continuous testing are available as retainers after the fixed-scope project ends.
- A retainer can cover monthly platform updates, which matter for openDesk and Nextcloud release cycles.
- Ask any provider to state in writing which support tier, response times and patch sources are included.
- Retainer scope is agreed separately, so you can size operations to the team you keep in house.
