CIO — SharePoint has unquestionably garnered a lot of attention from business users and IT. Toby Bell, Gartner Inc.'s research vice president, calls SharePoint 2007 "nothing short of a phenomenon." He says the growing number of searches for SharePoint on Gartner.com indicates high interest in the product and some confusion about its value.

"For Microsoft and its partner ecosystem, it's easy to see SharePoint becoming the billion dollar baby in ECM [enterprise content management]," says Bell via e-mail. "[However,] estimating the potential ROI of SharePoint and related products for enterprise buyers is harder."

Indeed, the true costs of deploying and supporting SharePoint are not well understood. Fundamental misconceptions about SharePoint prevent organizations from deploying it effectively and realizing its value. Many IT executives view SharePoint as a shrink-wrapped product that can be installed and configured in hours or days. In fact, it cannot. SharePoint is truly an enterprise information platform and must be treated as such. That means SharePoint configuration work needs to be well-planned and designed—not conducted in an ad-hoc fashion.

[ For case studies of companies using SharePoint, see How Allied North America Uses SharePoint to Give Visibility into Customer Risks and Microsoft SharePoint: Project Management Answer for a Multi-Million Dollar Construction Effort. ]

What's more, because SharePoint has been popular among users, SharePoint sites have popped up all over enterprises, resulting in what is known as "SharePoint sprawl." The ability for users to easily create and manage a SharePoint site is one of the product's benefits, but the subsequent sprawl takes up lots of storage space, increases costs and makes it harder for users to find documents due to inconsistent metadata and tagging.

This article explores the true costs of SharePoint—both expected and unexpected. By gaining a firm handle on these costs, IT leaders will be able to identify whether the product is right for their organizations and will be better prepared to take advantage of SharePoint's many benefits.

Expected Costs

When determining the true cost of deploying SharePoint, CIOs need to consider the expenses typically associated with rolling out any new software product, such as the cost of licenses, server software, virus protection, hardware and infrastructure, and IT staff. Here's a breakdown of the costs IT leaders can expect to incur when deploying SharePoint.

1. SharePoint Product Licenses: Microsoft offers different licensing options for SharePoint. Pricing for each of these options can vary considerably based on an organization's licensing agreement with Microsoft. In this regard, it is important for IT leaders to determine if they are going to be employing the free version of SharePoint, known as WSS (Windows SharePoint Services), or if they'll use MOSS (Microsoft Office SharePoint Server) Standard, Enterprise or SharePoint for Internet Sites.

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