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I have a requirement to develop a public-facing good document management platform where customers can create a profile and upload his documents. These documents will be confidential, so security will be a high concern. A document viewer (another type of visitor) can also create his profile and waits for admin approval to view certain user documents. Admin will review 'A Viewer' profile and grant him/her rights on certain user folders.

Generally, this platform will have these features.

  1. A public facing site with good GUI.
  2. A profile creation page which creates some folders (where the customer can upload documents.
  3. 3 level role/ rights management.
  4. certain workflows to forward document to next level or to generate notifications etc.

Keeping above requirements in mind, will it be a good move to choose SharePoint Foundation Server. If yes, what will be the cost required other than SQL and Windows Server licenses?

Also, is this true Microsoft announced to discontinue public sites after 2017?

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SharePoint, and I include SharePoint Foundation, is OK for public/Extranet sites: it has authentication and authorization capabilities. By default, this relies on a login/password credential, but you may develop another authentication mechanism if needed (including a 2-factor authentication if you want... and if you have enough money).
There's a lot of companies using SharePoint (or SharePoint Foundation) both internally and externally.
When Microsoft says public sites will be discontinued, they mean in the context of their Office 365 offer; this does not impact SharePoint on-prem.
Note however that SharePoint Foundation (i.e. the free edition of SharePoint Sever) is discontinued from version 2016: there won't be a new version after SharePoint Foundation 2013 (while SharePoint Server 2016 has been released).

Finally, if you consider SharePoint Foundation as a development platform (which I generally do), you mainly have to take into account the time you'll gain/lose by using it to develop a Web application compared to starting "from scratch". SharePoint will provide you with high-levels features like permissions, folders, versioning, etc., but it will also come with some drawbacks.
Only a deep study of your needs (+ a good knowlegde of the strengths and weaknesses of the product) will give you a clue about the cost. But in your case, that could not be less than ~10s days I guess.

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The business requirements suits for SharePoint platform but usually SharePoint is used within organizations. When we create a public facing site on SharePoint most important aspect to be considered is the Capacity planning as SharePoint applications are often resource intensive applications.

I dont think MS discontinue public sites in 2017. SharePoint online is a public facing site with anonymous login, can user can visit the site but when you create a SP online, it dedicated server resources per site collection and as the usage is more, we need to increase the resources.

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