Is your organization ready for the cloud, or does it need on-premises infrastructure? If you are a business that wants to improve teamwork, manage documents or foster sound communication, then choosing amongst them can be difficult. Indeed, SharePoint is a famous platform of Microsoft for stress-free team work. It offers powerful features in both versions, but how do you choose which one is the best?
SharePoint Online is the best for businesses that have many teams spread across many locations or want to cut back on set up costs. It offers flexibility and automatic updates. On the other hand, organizations go for SharePoint on-premises that need customization and control over data.
The choice isn’t always easy to make. So, in this blog, we’ll explore the key differences between SharePoint Online and SharePoint in-premises. Also, we will compare the advantages and disadvantages of each of these. So that you will pick the best solution as per your business needs. Let’s explore in detail.
What Is SharePoint?
Before we move further into what is SharePoint Online and what is SharePoint On-Premises, let’s first know what exactly SharePoint is!
SharePoint is a web-based collaboration and document management platform. With this, businesses can create intranets, manage documents, simplify workflows and make possible good teamwork. As it is flexible and powerful, it is a go-to solution for businesses of all types and sizes! There are various SharePoint versions that work at their best to meet your business needs.
The platform provides multiple features like:
- Document storage and management
- Teamwork and communication
- Version control
- Custom workflows
- Intranet portals
Initially, SharePoint was introduced as an on-premises solution. Now Microsoft also put in place SharePoint Online platform. It offers similar functions but differs in hosting, management etc.
SharePoint Online vs. SharePoint On-Premises: What’s the Difference?
SharePoint Online
Being a cloud-based version, it is a key platform to manage documentation and collaboration. SharePoint Online is hosted on Microsoft’s servers. So, you don’t have to worry about maintaining hardware or take care of the setup!
SharePoint On-Premises
On the other hand, SharePoint on-premise is installed and hosted on servers within your organization. Opposite to SharePoint Online, it needs on-site setup, ongoing upkeep and management done by your IT team. This SharePoint version offers great customization despite bringing in extra responsibilities.
Need help optimizing SharePoint Online for your team? Contact our experts at NGS Solution for a tailored solution!
Key Differences Between SharePoint Online and SharePoint On-Premises
When deciding between SharePoint Online and SharePoint On-Premises, understanding the key differences is essential to making the right choice for your organization.
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Hosting:
The most important difference is where the platform is hosted. When we talk about SharePoint Online, there is no need to have physical infrastructure. SharePoint Online offers cloud-based hosting. However, SharePoint On-premises demands hosting it on local servers with a focus on more control of the environment.
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Maintenance:
As you opt for SharePoint Online, there is no need to hire a team for its upkeep. Microsoft handles all maintenance and updates. However, there is a need to hire an IT team to manage updates and maintenance of SharePoint on-premises.
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Costs:
The cost of both of these SharePoint versions differ. SharePoint offers a subscription-based model. The monthly or annual cost includes hosting and maintenance. In contrast, SharePoint On-premises can be a costly option as it has upfront costs.
Pros and Cons of SharePoint Online and SharePoint On-Premises
Let’s take a deeper look at the pros and cons of each version to help you decide which one is the best for your organization:
SharePoint Online
Pros:
- Cost-Effective: With SharePoint Online, there is no need to have expensive hardware, data centers and IT maintenance. Thanks to the subscription model, prices can be predicted easily.
- Automatic Updates:SharePoint Online integrates well because Microsoft takes care of all updates. It means you will have access to the latest features, safety and improvements.
- Scalability: SharePoint Online offers unlimited storage. It means you can set your SharePoint environment as your business grows.
- Remote Access:SharePoint Online is useful because it lets your team access content from any location. So, it is valuable when it comes to remote working or improving teamwork.
- Security and Compliance: Microsoft backs SharePoint Online in terms of safety protocols. For various industries, SharePoint Online offers multi-factor authentication, encryption and compliance.
Cons:
- Customization Limitations: While SharePoint Online offers high customization, it has certain limitations too. For organizations with complex needs, these limitations might be a hurdle.
- Dependence on Internet Connectivity: SharePoint Online platform doesn’t work without a stable internet connection. As it relies on cloud connectivity, it cannot function offline.
- Limited Control Over Updates: Updates are automatically rolled out, which could potentially impact your workflows or custom features.
SharePoint On-Premises
Pros:
- Complete Control: SharePoint On-Premises offers you complete control over your environment.
- Advanced Customization: It allows for more advanced and personalized customizations to meet business needs.
- Data Privacy: With SharePoint On-Premises, your data stays within your own infrastructure, giving you full control over security and privacy protocols.
Cons:
- Higher Costs: SharePoint On-Premises comes with upfront costs for hardware, licensing, and continuous maintenance.
- Manual Updates: Your IT team must manage updates, which can be time-consuming and complex. Failure to regularly update could leave your environment at risk.
- Limited Scalability: Scaling your SharePoint On-Premises environment needs extra hardware and infrastructure, which can be both costly and challenging.
Looking to upgrade to SharePoint Online or improve your On-Premises setup? Let’s discuss your needs today and get a customized solution!
Key Factors to Keep in Mind While Deciding Between SharePoint On-Premises vs. Online
Selecting between SharePoint Online and On-Premises depend on many factors. Let’s look at some of the important decision-making factors:
Cost
SharePoint Online is more reasonable for businesses that don’t want to invest in expensive hardware. Its subscription model offers flexibility, especially for smaller businesses with restricted IT resources. One of the SharePoint versions, On-Premises SharePoint, involves upfront costs. These include purchasing servers, licenses and managing infrastructure. So, large companies with handsome IT budgets or complex needs, can find this option suitable.
Dedicated Infrastructure
If your organization has an all important setup and IT team, then SharePoint On-Premises might be the better option. However, SharePoint Online works on cloud, so there is no need to have a physical set up. This ultimately saves time and money.
Updates
SharePoint Online offers automatic updates. So, your team doesn’t have to devote energy to manually apply patches or new features. On the other hand, SharePoint On-Premises needs a team to manage updates. This results in extra time taken or increases costs.
Data Backup
In SharePoint Online, Microsoft takes care of data backup and disaster recovery. However, SharePoint On-Premises needs your organization to manage data backup and recovery. Therefore, it becomes difficult and requires extra resources.
Data Storage
SharePoint Online is a flexible cloud-based storage platform. It adapts as per the need. As for SharePoint On-Premises, the storage is limited. It is because of the physical hardware in place. So, as your data grows, it becomes a real challenge for organizations!
Data Safety
Microsoft invests heavily in the safety of SharePoint Online. To protect your data, the common safety features are encryption, multi-factor authentication etc. SharePoint Online integrates well with businesses of all types because of this reason.
Customization
Customization is a golden feature of SharePoint On-Premises. So, if your organization needs custom workflows or deep integrations, On-Premises is the best. SharePoint Online offers customization but may not be as customizable as On-Premises.
Major Variations Between SharePoint On-Premises vs. Online
Here are some of the most significant variations between SharePoint Online and SharePoint On-Premises:
| Features | SharePoint Online | SharePoint On-Premises |
| Deployment | Cloud-based | Hosted on local servers |
| Management | Managed By Microsoft | Managed by your IT team |
| Scalability | Highly scalable | Limited by on-premises hardware |
| Customization | Limited to web-based only | Full control and deep customization options |
| Cost | Subscription based | Needs hardware investment and continuous maintenance |
| Safety | Managed by Microsoft | Managed by your IT team |
| Compliance | With Industry standards | Needs in-house management for compliance |
When to Use SharePoint Online?
Is your organization also looking for ways to reduce costs and difficulty? Then SharePoint Online is your resource! To take the burden off your shoulders, SharePoint integrates well to minimize infrastructure and maintenance costs! With Microsoft handling all the hosting, updates, and security, your team can focus on collaboration, not IT management.
For businesses with remote teams, SharePoint Online offers the flexibility to access documents. Also, it helps in collaboration from anywhere and at any time. This is important in today’ world, where remote work is more than physically going to the office!
If you are looking for a solution that is easy to manage and doesn’t need an IT for support and maintenance, pick SharePoint Online as your ideal choice! However, you might be still wondering if you find a reliable SharePoint service provider. So, let NGS Solution take the charge and implement SharePoint Online to take your business to new heights of success!
When to Use SharePoint On-Premises?
Have you ever realized that deep customizations can provide your business a more competitive edge? Then, SharePoint On-Premises is the ideal solution for your organization. It offers more control over the environment and addresses specific needs too. Also, you can manage your data on your own terms, according to the physical setup. Such an infrastructure is a blessing as it offers safety and peace of mind!
SharePoint On-Premises is one of the most flexible in SharePoint versions. It is especially useful for complex workflows or for in-depth customizations. Whether you want your organization to integrate with legacy systems, build complex processes or tailor the platform, SharePoint On-Premises is the best!
Unfortunately, SharePoint On-Premises needs an IT team for installation, maintenance and regular updates. Once your team is all set to take care of these responsibilities, this option might be the right fit for you!
SharePoint Online vs. On-Premises Comparison – Which is Better in 2025?
As we have entered in 2025, SharePoint Online is the choice of most of the organizations. It is due to the continuous growth of cloud technology. Also, it is the increasing demand for remote workforce. For all these reasons, SharePoint Online is a more reliable and result-driven option. Your business can also b benefitted from cost savings, flexibility and scalability.
Why is SharePoint Online a Better Option?
It is without any doubt that businesses need smart and cost-effective solutions. In this regard, SharePoint Online emerges as one of its kind! It offers low cost of ownership. Hence, there is no need to invest in costly physical hardware. You don’t have to worry about continuous maintenance!
Scalability is another key advantage of SharePoint Online. SharePoint Online integrates well with businesses of all sizes. It offers seamless expansion without stress of managing on-premises setup. Thanks to Microsoft’s powerful safety as it makes sure that your data is safeguarded with world-class measures!
SharePoint Online platform can be suited well to support the organizations’ needs. Whether it is maximizing remote access abilities, teams can work together from anywhere at any time. In addition, the easy integration with other Microsoft tools improves output and simplifies workflows across organisations.
Trusting NGS Solutions For SharePoint Services (Online and On-Premises)
Is SharePoint available to assist you with all its might and main? You don’t have to lag behind when it comes to executing SharePoint for your organization! It is because a reliable partner, NGS Solution, is there for you! The SharePoint experts have experience and skills in offering made-to-order SharePoint solutions. We are experts in all SharePoint versions. Whether it is SharePoint Online or On-Premises!
Why Are We Considered The Best?
- Our professionals understand your unique needs (they work closely with you_
- They make sure that the platform works perfectly for your team
- We are experts in SharePoint migration
- Our result-driven approach fosters: Improved collaboration, simplified workflows and boosted output
- We provide end-to-end solutions that make SharePoint easy to manage and use!
We take care of all the technical details and complexities. Our end goal is to help your organization unlock its full potential without much difficulty! With NGS Solution, you can be sure that your SharePoint environment is in safe hands and matches well with your business needs!
Let us help you transform your SharePoint experience into a strategic advantage. Partner with NGS Solutions today for a future-ready SharePoint that drives results.
To Wrap Up
By this time, your confusion must be cleared relevant to deciding between SharePoint Online and SharePoint On-Premises. So, to put it simply, SharePoint Online is the clear winner! For all your organizational needs, it offers flexibility, cost-effectiveness and scalability!
However, if you don’t want to depend on a platform and get deep customizations, SharePoint On-Premises is the right choice! Your organization might need physical infrastructure or resources, however! But it would be advisable to choose SharePoint On-Premises as the best fit! No matter which option you choose, SharePoint changes the way your team collaborates and manages information.
Seamless migration to SharePoint Online or performance boosts for On-Premises? Book your free assessment now! – We take care of all your organization’s SharePoint needs!
FAQs
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Which is more cost-effective: SharePoint Online or On-Premises?
In general, SharePoint Online is more affordable. It is because it follows a subscription-based model. There are no upfront costs for hardware or setup. Moreover, there is no need to have an internal IT team to manage the platform. On the other hand, SharePoint On-Premises turns out to be costly because of hardware and licenses. As there is an infrastructure involved, it requires continuous maintenance and IT staffing expenses!
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Which version offers better security?
Both SharePoint versions offer robust safety. But with SharePoint On-Premises, you can have full control over the security protocols. If you need powerful data privacy or compliance, On-Premises may be better. It doesn’t mean that we can let go of the world-class safety infrastructure of the cloud! In today’s world, most of the organizations require highly secure platforms that include regular updates too.
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Is SharePoint Online suitable for growing businesses?
For growing businesses, SharePoint Online is highly scalable. It grows with your business needs. You can add users and increase the storage as well without any need of hardware.
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Which version is better for my organization in 2025?
In 2025, SharePoint Online is likely the better option for most businesses due to its lower cost, ease of use, scalability, and integration with other Microsoft tools. However, if your organization needs strict control over data or has unique customizations, SharePoint On-Premises stands alone!
