They're two generations old.

The generation after that ran Linux (they dropped BSD) on a server motherboard and a Broadcom switchplane at the front to do the simple stuff.

I've not seen inside the latest generation but I'm told they use a completely custom-fabricated motherboard which integrates the two parts. These still run Linux. Both use SSL accelerator chips.

That said, the hardware is only a small part of what you're paying for, you're also paying for the TMOS operating system, administration interface, other software, support and testing. Obviously there is also some profit, as you can see from their accounts, but if people thought this was unreasonable they would buy an alternative - there are plenty out there.

I know Microsoft is a bad word sometimes on /., but Hosted Exchange is ideal for this. Google Apps for domains is a good solution as well, if you don't want the MS solution, but if you're interested in things like OWA, shared calendars, Activesync and those kind of things hosted Exchange is good.