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SharePoint Comparison: Online vs. On-Premises

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Effortless sharing and seamless collaboration with SharePoint

Since its launch, i3solutions has provided SharePoint Migration Services and SharePoint modernization consulting for almost 30 years, helping enterprises transition from legacy environments to scalable, secure platforms that support workflow automation and seamless collaboration. Today, SharePoint is deployed in over 400,000 organizations, serving approximately 190 million users worldwide, and around 80% of Fortune 500 companies rely on it for secure collaboration and document management.

Although the tool started out as an entirely on-premises solution, today, organizations have the added option of a cloud-hosted solution, or a hybrid compromise between on-premises and online. Determining which of these solutions makes the most sense for your organization can be challenging though, and this can be even more so when you are considering migrating from an earlier on-premises version.

There are various considerations underlying any decision between these options, including the specific needs of your organization and how this aligns with the features on offer across board. As a U.S.-based Microsoft SharePoint development company, we support both new deployments and legacy SharePoint to SharePoint Online migration – while helping organizations evaluate their current environment and determine which solution best fits their business, compliance, and growth needs.

SharePoint Comparison: On-premises or online – the perfect choice based on your needs

Our experienced Microsoft-certified SharePoint consultants at i3solutions explain how these options stack up against each other and the factors you need to keep in mind as you make your decision.

How organizations use SharePoint

The use case for SharePoint varies considerably in relation to the resources, business, specific needs, and corporate goals of each organization. However, a consistent theme is the use of the platform to host documents, build workflows, automate HR processes, and govern access to business systems. Many organizations rely on SharePoint for employee onboarding, SharePoint forms development, and SharePoint knowledge base solutions to standardize and streamline operations.

The platform is highly configurable, enabling organizations with the capabilities to design systems and workflows that complement their internal processes. Some of the ways organizations use SharePoint include:

SharePoint Comparison: Differences between SharePoint Online and SharePoint 2019 on-premises

With the onset of broad industry trends such as Digital Transformation and change management, more organizations are considering taking their enterprise to the cloud. Due to the cost, resource, and availability advantages of the cloud, SharePoint has become a compelling option for many companies. However, there is a significant business case for maintaining SharePoint On-Premises Server, especially amongst large organizations that want more control over their data and information.

Considering the unique factors at play between both options in terms of setup, cost, and customizations, it is important to understand the full picture of what both options present before making a decision. Here are the most important features and differences to keep in mind:

Infrastructure and Hosting

Online: SharePoint Online has essentially zero infrastructure or hosting requirements. Since the software runs in the cloud, organizations have no need to maintain any of the infrastructure internally. All they need to access the cloud resource is a paid license and reliable internet connection.
On-Premises: Organizations will require physical servers, a sufficiently large IT support team, and system administrators in order to deploy SharePoint On-Premises. As a result, on-premises can represent a very resource-intensive option, especially at the outset. There will also be a need to procure critical hardware to support the installation, if this is not already available.

Installation

Online: With SharePoint Online, there is no real need to install anything. The platform is provided on a PaaS basis, meaning all organizations need to do is login and they can commence work. Of course, there will be a need to factor in the processes and costs surrounding the migration process if a decision is taken to move from on-premises to cloud or a hybrid solution.
On-Premises: SharePoint Server 2019 comes with a long list of installation requirements. These include installation and configuration of Microsoft SQL Server, Microsoft .NET Framework version 4.7.2, IIS Web Server, and an Active Directory Server. The computers on which the platform will be installed must also maintain minimum operation requirements.

Integration

Online: SharePoint Online is completely integrated with Office 365, OneDrive, Microsoft Teams, the range of Power tools and more. In addition, organizations are able to employ Office 365 APIs and take advantage of SharePoint + Power Automate integration to build custom low-code workflows. Our team includes SharePoint integration specialists and Power Platform developers who help unify business processes across Dynamics 365, Microsoft Teams, and beyond.
On-Premises: SharePoint Server 2019 provides organizations with many integration options across Microsoft Power Apps, Power BI, and Power Automate as well as Office 365, among others. Although, these must often be configured manually.

Updates

Online: SharePoint Online updates are automatic since the platform back end is controlled by Microsoft. This means that security problems are typically fixed speedily and organizations do not need to worry if their software is up to date. In addition, new features are typically released first online before they find their way to SharePoint Server.
On-Premises: With SharePoint Server 2019, updates must typically be carried out manually by installing patches provided by Microsoft. These updates often track contiguous updates carried out on the cloud platform.

Security

Online: While SharePoint Online does offer a suitably high level of security in addition to multi-factor authentication, certain organizations may want more control over the vulnerability of their data and processes.
On-Premises: Questions around security are often nuanced, especially because they almost entirely depend on what works for each organization. SharePoint Server 2019 gives organizations extensive control over the platform, meaning they can enforce the security measures and processes they believe will best protect their data.

Compliance

Online: SharePoint Online does not provide this flexibility that compliance standards may require. Organizations will be automatically subject to Microsoft’s built-in redundancy and other protocols.
On-Premises: As you would expect, SharePoint On-Premises provides significantly more latitude for niche-specific compliance features. It gives organizations direct control over their information and compliance standards, which they can then structure according to their industry requirements.

Note: For public sector and defense organizations, i3solutions supports SharePoint deployments in GCC and GCC High environments, ensuring alignment with compliance frameworks such as CMMC, NIST 800-53, and DFARS. Our team works directly with ISSOs and compliance stakeholders to ensure secure, standards-driven implementation.

Data Backups

Online: With SharePoint Online, Microsoft provides the necessary data redundancy protections through its servers and data centers. The platform promises 99.9% availability due to its distributed servers in various countries. However, deleted documents in the recycle bin will be permanently lost after 93 days. In addition, when an organization decided not to continue with SharePoint Online, they will typically be required to transfer their data within 90 days.
On-Premises: As long as the environment continues to receive Microsoft support, SharePoint Server 2019 provides indefinite data protection, so long as backups are conducted frequently. While the backup process and scheduling must be conducted manually, the opportunities for data recovery are potentially higher for SharePoint Server.

SharePoint Comparison: Which version is right for your organization?

SharePoint Online and SharePoint On-Premises 2019 cater to very distinctive needs in various organizations. It is useful, therefore, to understand where the two options differ, whether favorably or otherwise, and what this will imply for your organization.

Automatic updates: With SharePoint Online, the platform is constantly and automatically updated with important security patches and new features. Users of the online platform do not need to worry about their possibly redundant farm setup, backup issues, or the burden on IT to keep the local environment current. However, the trade-off is that automatic updates may be undesirable for organizations with complex configurations or where inconvenient bugs arise.

Local control: SharePoint On-Premises allows organizations greater control over external access, internal processes, and similar protocols. Compared to this, the online solution represents more of an off-the-shelf deployment that may not offer as much control.

Compliance: For organizations in industries with complex compliance requirements, on-premises can be especially beneficial. Organizations can exercise closer control over how their data is stored and access. This can help prevent foreign countries from accessing their data or exercising jurisdiction over them, or help them meet compliance requirements for housing the data they collect within a region, for instance.

Installation and administration: On-premises takes up more skill and resources for installation, configuration, and maintenance. While this cost may be acceptable for large organizations with a need for heavily customized solutions, it makes less sense for a smaller enterprise looking to grow steadily.

Cost: Payment for on-premises is one-and-done, compared to online which is billed monthly or yearly. While the monthly sum seems negligible initially, it can add up quickly the more the users licensed on the platform. Our Microsoft-certified SharePoint consultants can help calculate total cost of ownership across cloud and on-premises scenarios, and recommend the best-fit licensing, support, and scaling model.

Scalability: SharePoint Online presents the convenience of scalability for smaller organizations. They can easily provision SharePoint resources according to their immediate needs and then scale at their own pace rather than commit to the more significant up-front costs of an on-premises solution.

Availability: Organizations without the distributed infrastructure and on-site teams that can help ensure high availability may be better suited with SharePoint Online.

Have the SharePoint Comparison Disscussion with i3solutions

All successful organizations, regardless of their specific goals, depend on reliable, scalable infrastructures that can support integration, data transformation, rapid and secure file transfer, and end-to-end visibility of all data that flows through their system. i3solutions has honed the expertise necessary to help organizations determine if a cloud based or on-premises solution would best fit their business goals. Whether you choose SharePoint On-line or SharePoint On-Premises, i3solutions can guide you through the selection and implementation processes to deliver a scalable solution designed to meet your exact business needs.

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