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SharePoint Online Vs On-Premise – Which Is The Smarter Choice For Business?

18 Feb 2019

Sharepoint is a collaborative work tool primarily used for content management, electronic document management, messaging, and its ability to manage decision statistics. Think of SharePoint as a centralized, secure platform on which groups can collaborate, streamline data management, and increase efficiency. However, companies that have embarked on a SharePoint deployment face two options – which among SharePoint on-premise and online would be a better choice for their requirement? The idea is to fine-tune their operations and be as efficient and effective as possible.


This article provides an overview of the significant differences between SharePoint Online and SharePoint On-Premise. It further aims to help you select the right option for your business.


SharePoint Online And On-Premise Comparison

Both SharePoint Online and SharePoint On-Premise are SaaS-based file management tools, perfect for collaboration between employees regardless of their location.


  • Data Storage
    Your choice depends on the volume of data you want to store. On-premise deployments can theoretically support an unlimited amount of SharePoint data. All you have to do is buy and then provision the right category of hardware (at an additional cost). SharePoint Cloud subscriptions do not include an unlimited data storage offering. However, Microsoft has set the limit at 10 GB, plus 500 MB per subscriber user. Also, there is also a maximum quota per subscription. The threshold for almost all SharePoint Online subscriptions is 25 GB. The exception is the small business (P) subscription with a limit of 35 GB.
  • The Costs
    Sharepoint Online versus On Premise-based based solution discussions are never complete without cost considerations. SharePoint farms comprise of multiple SharePoint servers, and each must have a proper license. SharePoint Online deployments are different: the number of SharePoint servers required to support a solution deployment has no impact on implementation costs. A flat rate license subscription governs it. This licensing model makes it possible to benefit from a firm-class SharePoint farm without having to worry about the number of servers and SharePoint licenses used. Office 365 further helps reduce administrative costs related to maintenance operations. For example, Microsoft provides continuous patch management and server updates. Likewise, your IT team no longer has to deal with the cumbersome processes of migrating to the latest version of SharePoint. Microsoft does it for you.
  • Licensing
    While both onsite and cloud deployments provide access to Office Web Apps, their licensing model is different. All Office 365 subscriptions allow users to view their Office documents online. Also, Small Business subscriptions (Plan P) and most of those aimed at SMEs and other businesses (Plans E2, E3, E4) provide access to Office document editing. This function is also available in one of the kiosks (plan K2). For on-premise deployments, an Office Web Apps license to view Office documents is not required. However, if the company wants to use Web Apps to edit documents, they must obtain a separate license.
  • Seamless Integration
    Microsoft has simplified the Sharepoint document library interface based on the real-user statistics. It is based on the preferences of buttons, functions used by millions of OneDrive consumers. The interface change to feature pack of Sharepoint farms doesn’t affect the look and feel of the content and document libraries from the user standpoint. Be it for 2013, 2016, On-Premises and Online. It will make the collaboration simpler with lesser user resistance for change.

Sharepoint Online Vs. Sharepoint On-Premise debate covers the essential factors for your business. Costs are logically part of it. Though, On-Premise and cloud are similar solutions in terms of functional coverage. Your choice depends on which among the two will adapt to the different contexts in terms of internal organization of requirements and regulations. Also, if you are not sure about whether a full move online or want to introduce your company to the process slowly, Hybrid is also the option for you.

When To Choose Sharepoint Online?

Cloud deployments are better for organizations looking to build a scalable and fault-tolerant SharePoint farm. It is beyond bearing the cost or complexity. With the Online version, you make a sensible choice in the short term, to avoid the tunnel effect of setting up massive infrastructure. However, for the future, you can take advantage of the product developments while agreeing to follow the schedule of updates from the publisher.

When To Choose Sharepoint On-Premise?

On-Premise, with its dedicated infrastructure, is better suited for an organization with high-security standards, customization requirements, and achieving economies of scale on licenses. It is ideal for companies seeking more storage than Microsoft offers or more control over their farm architecture. Further, if you need advanced customization and developments specific to your business, SharePoint On-Premise is your go-to solution.


As you can see, there are several factors to consider in your choice of SharePoint deployments, whether On-Premise or in the cloud. With its SharePoint development solutions, Rishabh Software helps you leverage the speed, control, and scalability for your deployment requirements. Our experts consult, develop, and deploy solutions to optimize and improve your technology practices and internal processes.

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