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sharepoint online vs on premise

SharePoint Online vs On-Premise: Best for Business?

19 December 2022

SharePoint Migration

As business technology advancements grow, so does the need for secure and convenient digital collaboration. Microsoft is one of the leading business product providers, and its SharePoint platform provides organizations with a digital hub for communication, collaboration, and business process management. When it comes to the SharePoint platform, you have two options, SharePoint online and on-premise. The entire concept is streamlining the daily business operations and making them as efficient as possible. In this article, we’ll compare SharePoint online vs SharePoint on premise. So, you can understand which one is best for your organization. let’s get started!

SharePoint Online vs On Premise: Key Difference

Data Storage

Data storage is an important factor when deciding between SharePoint on-premise and online. On-premises environments can provide organizations with an unlimited storage space, as long as they have the right infrastructure. When it comes to online, storage is limited per user and per subscription. If you need to store massive amounts of data, then an on-premises deployment is a good option. It can support an unlimited amount of SharePoint data with the right category of hardware. On the other hand, if you’re looking for more modest storage requirements, SharePoint online subscriptions could be the way to go.


Have you ever wondered how SharePoint online, and on-premise solutions differ in terms of cost? With Online, you get a flat-rate license subscription, so you don’t have to worry about the number of servers or SharePoint licenses used. Plus, you get the benefit of automatic patch management and server updates from Microsoft, so your IT team won’t have to bother with the hassle of migrating to the latest version of SharePoint.


The on-premise version requires you to purchase a license for each server and CAL (standard or enterprise) for every user. With SharePoint Online, Microsoft 365 Business, or Enterprise, licenses are already included.

Both SharePoint on-premises and online versions grant you access to Microsoft Office’s web applications. The only difference is the type of license, for On-Premises, you’ll need one to ‘view’ and ‘edit documents’ through the web applications, while the Online version lets you view and edit documents through the cloud without any extra licensing.

Seamless Integration

With SharePoint Online, you get the full package: Microsoft 365, OneDrive, Microsoft Teams, a range of Power tools, and more. Plus, you can take advantage of M365 APIs to create custom cloud-native applications.

SharePoint Server 2019 offers almost the same features with manual setup. Here, you can integrate with Microsoft Power Apps, Power BI, Power Automate, and MS 365.

Data Management 

SharePoint On-Premises requires an internal IT team to manage your data, making sure experts in data governance, compliance standards, and third-party application support are all on board. With SharePoint Online, Microsoft’s team takes care of data center issues while providing some compliance requirements and Microsoft 365 security systems like Active Directory and secure token systems. Plus, you get the convenience of single sign-on.

Hosting and Infrastructure

SharePoint Online is an idyllic option for any organization seeking to access cloud resources – all you need is an internet connection and a paid license. On the other hand, SharePoint On-Premises will require quite a bit more effort and resources, such as physical servers, a sizeable IT support team, system administrators, and additional hardware. So, if you’re looking for a quick and easy solution, SharePoint Online might be the perfect fit!

  • SharePoint Online is a cloud-based solution that offers scalable resources as per the need of the organization, allowing you to quickly add or remove users and storage as necessary.
  • On-Premise, on the other hand, is hosted on the company’s own servers, and scalability is limited by the hardware and infrastructure available.
External Users
  • SharePoint Online allows you to easily collaborate with external users, as it provides the option to grant access to people outside of your organization without the need for additional setup or configurations.
  • SharePoint On-Premise requires additional setup and configurations to grant access to external users, making it less accessible for external collaboration.
  • SharePoint Online provides a limited ability to customize and extend its functionality using custom solutions, such as SharePoint add-ins and SharePoint Framework solutions.
  • On-Premise offers greater flexibility and control over customizations, allowing you to develop custom solutions using server-side code, such as farm solutions and sandbox solutions, and make changes to the underlying architecture and infrastructure.

SharePoint Online vs On Premise: Which One to Choose?

When choosing between SharePoint online or on premise, you may become confused, since SharePoint is a complex system, and balancing its complexity with your server needs requires experienced help. As you can see, there are various aspects to consider when deciding whether to implement SharePoint on-premises or in the cloud. Star Knowledge SharePoint development services assist you in leveraging the speed, control, and scalability of your deployment requirements. To optimize and enhance your internal business processes and technological practices, our experts develop, test, and implement solutions. contact us today to get started.

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