SharePoint Online Vs On-Premises: Which One Is Best For Your Business


Currently, Microsoft is offering two types of environments in SharePoint i.e. SharePoint Cloud and SharePoint On-Premises. The latest version of SharePoint Cloud offering is commonly known as SharePoint Online, whilst for SharePoint On-Premise, it is SharePoint 2019.

Both the SharePoint products/environments are providing business enterprises with the set of tools and features that they need to improve workplace collaboration and productivity, while making the data sharing and content management easier than ever before. However, every organization is different in terms of their business needs and hence they must take the paybacks and shortcomings that each of the SharePoint solution could bring to them. In this blogpost, we have compared the six most important factors that you should think about before making your big SharePoint decision.

SharePoint Online Vs. SharePoint On-Premises – The Comparison

If you want to make an insightful and informed decision about which SharePoint platform is best-suited to your business enterprises, then here are the six important factors that you need to think about’

1. Cost

Cost is inevitably the most important factor every enterprise gets worried about. For SharePoint solutions too, you need to find out how much each option will cost you. However, between the SharePoint Online and On-Premises solutions, it is not only the cost of the platform; in fact, you also need to consider the data storage and number of users that you will get against it. In order to simplify the cost decision, we would recommend you to first recall your business goals. For instance, if you are planning up to increasing your employees soon, that means your numbers of SharePoint users are increasing which means that your cost will be increases too. For SharePoint On-Premises, you need to pay additional dollars for licensing, IT resources, maintenance and support in order to keep up with the system, however, for SharePoint Online the license itself is based on number of users. Hence, SharePoint Online usually comes up as a cheaper choice for businesses with employees more than 300, while small business finds On-Premises suitable and cost-effective considering their needs. 

2. Updates & Maintenance

If you opt for SharePoint Online, your data will be stored on cloud, which simply means that your personal server space will be less burdened or free. However, while putting up your data over a cloud server, that you have never seen, you can only hope that the server is tightly locked up. On the other hand, SharePoint On-Premises environment, you can have that peace of mind that all your data and information within the system that is very much in front of your sight, and your will more control over that, especially when accessing your data. Additionally, while choosing between the SharePoint On-Premises and SharePoint Cloud, you must ensure that your compliance officer has a say with the migration decision. Because, if the information is too sensitive to put on cloud and data breach could happen, then the first thing you are putting at stake are your customers. In that case. SharePoint On-Premises are the right choice for you.

3. Data Storage, Security & Location of Resources

If we talk about SharePoint On-Premises considering updates and maintenance, you will be requiring an on-site support team to manage all the latest updates, maintenance and security patches, that are latest released by the Microsoft. For that you need to constantly remunerate the team, so that can manage, monitor and reviews the hardware and software in order to keep them updated and in working order.

On the other hand, for SharePoint Online, Microsoft performs all the security updates and platform changes to the hardware itself, which means that your servers always remain updated. Still, if you are considering the SharePoint On-Premises option, then the good thing is that the updates and maintenance are not a huge concern because updates do not occur too frequently and the maintenance cycles are fairly consistent too, when you are using a powerful collaborative system like SharePoint.

4. Scalability

With SharePoint Online, you have to follow strict capacity limits and also need to monitor the storage limits closely. Although, you can always request for extra space, but for that you need to pay extra too, that can turn your cost-effective option quickly on its head. SharePoint Online is a slice of Office 365, which makes it’s the only contributor to the data and storage amount that you are permitted to use. Storage monitoring is crucial in Microsoft Office 365, especially when you are running tight on your budget. With SharePoint On-Premises environment, you can spend your energy on managing your server. You can always build the capacity that you need onset while adding it on the go. Additionally, your internal IT team members may find it more convenient to run data governance rules on servers and hardware, since it provides direct access to them.

5. Data Management

As discussed above, SharePoint On-Premises necessitates for an internal IT support team in order to manage your data and system updates. This require your company to have complete access to experts in data governance and have complete understanding of compliance standards and of third-party application support etc. On the other hand, SharePoint Online, relies completely on the Microsoft Support Team which assist you in tracking down all the data center issues. It also allows you to set not all, but some compliance requirements. For instance, Office 365 does not support Active Directly and other secure token systems; and it thus encourages single sign-on.

6. Infrastructures Needs & Support

SharePoint Server 2019 (On-Premises) has its own operating system and full list of prerequisites that you are required to reviews and understand before migrating to it. These requirements include Windows Server 2016 or 2019, SQL Server 2016, Microsoft Identity Extension etc. On top of these software requirements, you will also be needing servers, racks, hardware to connect SharePoint sever to your network, while managing traffic and security. Your IT team only needs to manage it.

On the other hand, SharePoint Online offers you to share your management burden with Microsoft Data Centers. Besides, infrastructure require for migration to SharePoint Online, there are only a few more infrastructure requirements. For that, you need to review your business operation to find out if any additional team member or new equipment is needed to make sure you achieve your defined business objectives.

The Goods & Bads of SharePoint Online

Coming down to deciding between the SharePoint On-Premises and SharePoint Online, there are a few more things that will help you making decision in favor of SharePoint Online option. Let’s have a look at them;

  • If you don’t have any over-sensitive information to protect, or have a smaller team of users to manage, then SharePoint Online is an ideal platform. It also serves as the best option, if there is no full time IT staff available to support in-house physical server – thanks to the supplementary backup and support team by Microsoft which extends its services to the SharePoint’s cloud edition.
  • Last, but not the least is having limited budget, and you don’t require too many customizations. Hence, in all such cases, SharePoint Online is the ideal option for your business enterprises.


On the other hand, you might not want to opt for SharePoint Online, if you are looking for getting better control over your data and information that is sensitive enough to put on cloud. And, you also have huge staff to support your specific business needs and creating customer solutions.

The Goods & Bads of SharePoint On-Premises

  • SharePoint On-Premises environment is ideal for your company if you require a more robust server. If your business data is highly sensitive to put under strict security, and you require advanced customizations to serve your business needs, then having a physical SharePoint Server is the right choice to make.
  • Moreover, if you are already having the staff, budget and the physical sever, then all you need to do is to put your hardware prerequisites in place, and in that case migrating to the Online options does not make sense either.


But, don’t bother going after SharePoint On-Premises when you want your people to access data servers from any location and want them to work remotely; or when you don’t have extended budget, equipment, staff or right prerequisites in place.

Get Expert SharePoint Consulting & Migration Services From Code Creators

As you assess your business and server needs, deciding between SharePoint On-Premises and SharePoint Online, you might get confused, as SharePoint is a complex system and reconciling its complexity with your server needs requires expert guidance. So, if you are ready to make such big decision on your own, you can contact Code Creators Inc. for its expert SharePoint Consulting & Migration Services. Code Creators Inc. has an extensive experience and super-talented professional at work, that are always happy to serve you with the best advice for your business. And once, you are thoroughly consulted and guided by our SharePoint Consultants, our SharePoint Migration Experts can also lead your way to make the process seamless and cost-effective.

Schedule a free consultation call now and get more information by clicking here.