SharePoint Hosting: Office 365 vs. On-Premise

28 Mar

SharePoint is utilized by organizations large and small all across the globe. Until recently most SharePoint installations were housed in an on-premise server or on a server managed by a third party organization. Recently, Office 365 and SharePoint Online was introduced as another way to hose your SharePoint installation. This also brought on the question, “Should I host my SharePoint installation on-site, or in the cloud?” – a very valid question indeed. Here are some of the Pros and Cons to Office 365 and On-Premise hosting.


Hosting your SharePoint installation on-premise or with a hosting company is the preferred method of most organizations. But why? Is it better? Safer? More reliable?


  • Systems Integration: It’s much easier to integrate other internal or external systems with SharePoint with an on-premise installation. Many cloud solutions have restrictions or guidelines that must be strictly followed, this is not the case with on-premise hosting.
  • Data: You have constant access and knowledge of where your data is housed, and have full control over its security.
  • Development: SharePoint development is much easier, and faster, with an on-premise solution as it allows developers to work with an entire SharePoint network instead of one site or site collection.
  • Performance & Hardware: Not only will you own the hardware, you have full responsibility and control over its performance.


  • Costs: The cost of on-premise hosting usually far exceeds that of cloud hosting.
  • Expertise: Finding the right IT professional to manage your hardware and SharePoint infrastructure can be difficult and/or expensive, yet does reap great benefits.
  • Reliability: If you don’t have the correct infrastructure to host yourself, yet you try, you could try and fail miserably, setting you back on time and money.
  • Maintenance: The hardware will need care and will need to be fixed if broken. You will need an employee or service to handle this
  • Additional Software: Not only will you need SharePoint, you’ll also need to install Exchange, Lync, or any other office or Microsoft services that you want to integrate.

Office 356/Cloud Hosting


  • Software Included: Microsoft not only gives you SharePoint, but you also get Exchange and Lync, and sometimes even full Office Suite licenses.
  • Remote Access: You can access your SharePoint environment from anywhere so long as you have an Internet connection. You won’t need a VPN or need to be logged in to the company network.
  • Maintenance: Any maintenance needed is done for you and if anything breaks, it won’t be on you to fix it.
  • Cost: While there is an ongoing cost either way, it is often less with a Cloud model, and you can often pay as you go such as by the month, quarter, or year.


  • Third Party Software Integration: Want to install a third-party web part or suite? You won’t likely be able to with Office 365 or other cloud solutions, especially if you are on a Multi-Tenant environment.
  • Data: Your data may not be housed in the U.S., or could be susceptible in other ways. In short, you don’t know exactly where your data is housed.
  • Server Side Installations: You can forget about installing anything that would have to be installed on the server itself. Most hosted solutions will not allow this.

So, what is the best method?

The best method is the one that fits your organization the best. We generally recommend On-Premise hosting solutions or those hosted by companies such as Neovera. You can more easily manage your installation and quickly build your SharePoint farm to your liking without dealing with the restrictions that come from a hosted solution.