SharePoint • 17th April 2019

SharePoint Online vs. On-Premises: How to Choose the Right Platform for Your Business


Microsoft SharePoint currently offers two types of environments. The latest version of its on-premises solution is SharePoint Server 2019, while SharePoint’s cloud offering is called SharePoint Online.

Both products provide companies with the tools they need to improve productivity and collaboration and make sharing data easier than ever.

But every organization has unique needs, requirements and IT infrastructure in place. When it comes to SharePoint Online vs. On-Premises, you need to consider the pros and cons of each before you can make a decision.

Comparing SharePoint Online vs. On-Premises

Need help making an informed decision about which SharePoint platform is right for you? Here are six important factors to take into consideration:

1. Cost

The first thing you need to determine is how much each option will cost you. But deciding between an on-premises solution versus the cloud isn’t just about the exact cost of the platform itself. You’ll have to consider how much data you need to store and how many users need access to SharePoint.

It’s also a good idea to consider your business goals. If you plan to double your number of users in a year, then your SharePoint costs can add up quickly. SharePoint Online is licensed based on the number of users, while on-premises requires additional dollars for licensing, maintenance, IT resources and more upkeep.

From a broad cost perspective, SharePoint Online is usually cheaper, so many small businesses choose it over on-premises.

2. Location of Resources

SharePoint Online stores your data in the cloud, which means your information isn’t contained in your own personal server. Instead, it’s on a server you’ll probably never see that is hopefully locked up tight.

With SharePoint Server, you do have peace of mind of knowing your information isn’t far from you. You have more control over who has access to the data and who doesn’t.

As you decide between SharePoint Online vs. On-Premises, make sure your compliance officer has a say in the migration. If the information you’re storing is sensitive and a data breach could place your customers at serious risk, then on-premises might be your answer.

3. Maintenance and Updates

As part of SharePoint Online’s offerings, Microsoft performs all of the updates to hardware and platform changes, so your servers are always up-to-date. SharePoint On-Premises, however, requires you have on-site team members who can manage the latest updates and patches. Your team will also have to continually review and monitor your hardware to keep things in working order.

The good thing is, though, that maintenance and updates might not be a huge concern for your company. Maintenance cycles are fairly consistent, and updates may not need to occur as often as they used to.

4. Scaling Abilities

Because SharePoint Online has strict capacity limits, you’ll need to closely monitor how much storage you’re using. You can request more space, but you’ll have to pay more to get it, which can quickly turn your more affordable option on its head.

SharePoint Online is part of Office 365, making it only one contributor to the amount of data you’re allowed to use. Monitoring all of the storage you have in Office 365 requires a careful eye if you’re on a tight budget.

With on-premises, however, you’ll be able to spend your energy on just managing the server. You can build the capacity you need on the onset and add as you go. Plus, your team members might find it better to run data governance rules on hardware and servers they can access directly.

5. Data Management

As already mentioned, SharePoint On-Premises requires that you have an internal IT team to manage your data. Your company should have access to experts in data governance, compliance standards, third-party application support and more.

SharePoint Online, on the other hand, relies on the Microsoft team to track down data center issues. It will allow you to set some compliance requirements, but not all. Office 365 does support Active Directory and other secure token systems, and it encourages single sign-on.

6. Infrastructure Needs and Support

SharePoint Server 2019 has a full list of prerequisites and operating systems that you need to review before migrating.

The requirements include SQL Server 2016, Windows Server 2016 or 2019, Microsoft Identity Extensions and more. And on top of your software requirements, you’ll also need racks, servers and other hardware to connect SharePoint to your network, provide security and manage traffic. And your IT team will have to manage it.

SharePoint Online allows you to shift some of the management burden to Microsoft’s data centers. There are very few infrastructure requirements besides the infrastructure needed to migrate to SharePoint Online. You will need to review your business operations to determine if you need any new equipment or additional team members to ensure you’re following your business objectives.

Pros and Cons of SharePoint Online

When it comes down to choosing between SharePoint Online vs. On-Premises, there are a few things that will point you toward the online option.

If you have a smaller team and you don’t have extra-sensitive information to protect, SharePoint Online could be an ideal platform. It’s also a great option when you don’t have a full IT staff to support a physical server, thanks to the additional help Microsoft’s team extends with the online edition.

Lastly, if you have a smaller budget and you aren’t working with many customizations, SharePoint Online could be the best option for you.

You might not want to go after SharePoint Online if you need better control of your data and how it’s stored or have a large staff that can both support your specific needs and create custom solutions.

Pros and Cons of SharePoint On-Premises

SharePoint On-Premises is best when your company needs a more robust server option. If you need to keep sensitive data under lock and key and you already have customizations you’re using specific to your needs, then a physical server is your best bet.

Plus, if you’re already using a physical server and have the budget, staff, and hardware prerequisites in place, then migrating to an online solution might not make the most sense.

Don’t bother with on-premises, however, when you want people off-site to have access to your servers, don’t have the right pre-requisites in place, or don’t have a large enough budget for staff and equipment.

Get Expert SharePoint Consulting and Migration Help From KMicro

As you re-evaluate your server needs, choosing between SharePoint Online vs. On-Premises can seem almost impossible. If you’re not ready to make a decision, contact an expert at KMicro.

We have the knowledge and experience with SharePoint that you need to choose the best option for your company. And once we’ve helped you choose, we can assist in your migration so that you can focus on your business or IT department.

Learn more about KMicro’s Pricing

If you’re ready to learn more about KMicro’s monthly pricing options, set up an appointment with one of our IT consultants or call now for more information: 949-288-4875

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