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On-premise vs off-premise

By Priya PedamkarPriya Pedamkar

On-premise vs off-premise

Introduction to On-premise vs off-premise

The present IT industry is showing a drastic change over the past decade in every zone. Talking of the data hosting concept, when started years ago the companies were left with an option either to house their data themselves or make someone else responsible for it and it is very interesting to see this huge shuffle that taking place across the globe considering the terminology on-premise and off-premise, which is what the today’s title of the discussion is.

On-premise is a proposed solution that runs or installed on the users/organization system, it might be supported by some third party (not compulsory).

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Off-premise has a different concept all together where the hosting and support is done by some other third parties (which are different).

Note – we have interchangeably used these terms ‘On-premise/on-prem’ & ‘Off-premise/off-prem’ whenever needed.

Difference Between On-premise vs off-premise

Deciding between on-prem and off-prem concepts draws multiple factors into play, let us see some prominent ones –

  • With on-prem software, everything is done internally from implementation, installation to an application running itself. Application maintenance like safety and updates related issues is also taken care by in-house, a user purchases the software it is installed on the servers which also need additional power backup, server management, database management, and also the operating systems whereas off-premise is a request as per the demand which includes everything in it from maintenances, safety issues and managing related infrastructure. A user can ask for additional safety features with additional charges to the service provider (aka third party vendor).
  • You are sole owner and hold the complete authority to your application and data whereas in off-premise you are not the authoring body rather some third party does for you.
  • On-premise does not have any subcategory what so ever under it whereas off-premise has several sub categories namely SaaS, PaaS, IaaS, and several others.
  • In on-premise you do not necessarily need the internet to use the application whereas in off-premise you definitely need an internet connection to operate on the application.
  • On-premise application does not have a subscription facility which varies from monthly to yearly; it is a onetime investment whereas off-premise is a subscription-based usage.
  • On-premise is more reliable and more secured whereas off-premise application has to compromise a little in this segment of comparison (since you are not controlling the data and application & data leak chances may take place).
  • On-premise application is most costly for small firms and also is less affordable whereas the off-premise application is more suitable to small firms.
  • Software updates is also an issue as we have to update them for better efficiency, an on-premise application has to worry in this as it may take time and money whereas off-premise application users do not have to worry as the charges are included and the updates can be done in quick time and often.
  • For any on-premise application, you can use it efficiently with or without the internet whereas off-premise applications are operated only with an internet facility. This point can also be inferred in a different way, for an on-premise application you cannot use it from any place at any time but this is possible for off-premise applications.
  • Mobile access is not or rarely possible for on-premise applications whereas it is quite easily available for off-premise applications.

Head to Head Comparison between On-premise vs off-premise (Infographics)

Below are the top 9 differences between On-premise vs off-premise:

On-premise vs off-premise

On-premise vs off-premise Comparison Table

Let’s discuss the top comparison between On-premise vs off-premise:

Parameters On-premise Off-premise
Existence There is no specific date for their existence. We have been using them since cloud technology came into picture. It all started in 90’s decade until Amazon claimed it in year 2000.
Example SharePoint 2013, Adobe creative suite & web trends on-premise, and several others are good examples under it Office 365, adobe creative CLOUD, AWS & web trends on demand fall as a good example in this segment.
Stats – Link

(for year 2008 to 2014)

 There has been a radical shift in the users population for on-premise applications where it drops to 13% (in 2014) from 88% (in 2008) There has been a radical shift in the users population for off-premise applications where it scales up to 87% (in 2014) from 12% (in 2008)
ERP solution  Some of the best on-premise ERP applications are MS Dynamics AX, MS Dynamic GP, and SAP ERP Some of the best off-premise ERP are MS Dynamics 365, Oracle NetSuite, Bright pay, Workday & SAP businesses all-in-one
Form of contract It has a License It has a Subscription
Increments of functionality An on-premise application has Modules as increment functions. An off-premise has Apps (which is an extension to core service) as an increment of functionality.
Cost structure On-premise application and services follow pay per capacity installed/owned as a cost structure for measurement. Off-premise has pay per capacity used cost structure parameters (which is variable) for measurement.
Pros and Cons Pros

· Lower long term cost with onetime payment

· Virtualization possible

· No data leaks

· Full control

· Full security

Cons

· Speed decreases with increase in users

·Recovery and backup takes time and depends upon the user number

· Deployment and scalability takes time and effort

· Regular updates

· Separate hardware management

 

 Pros

· Cost Saving

· High speed

· Reliability

· Collaboration

· Quick & easy development

· Automatic integration

· Data backup and restore facility

· API access availability

· Multi-tenancy

· Fast and effective virtualization

· Location and device independence

Cons

· Performance may vary

· Technical issue

· Security thread

· Downtime

· Internet connectivity

·Lower bandwidth

Lack of support
Security · security end to end

· Disconnected security tools, not driven by API’s

· IT-driven approach

·Automated rarely

 · Shared security responsibility

· Interconnected, API driven security tool

· Developer driven approach

· Highly automated

Conclusion

Once any organization has decided to move on an application requirement for the enhancement of its functionality the very next step is to determine what kind of solution will work, apart from numerous techniques that organizations select they must also think and decide whether on-premise or off-premise tools and services will be a best fit for their requirement. We have seen what possibilities they both hold within themselves and possible offerings they possibly could to their users.

Recommended Articles

This is a guide to the top difference between On-premise vs off-premise. Here we discuss the key differences with infographics and comparison table. You may also have a look at the following articles to learn more –

  1. SaaS vs On-Premise
  2. On-Premise vs Private Cloud
  3. Cloud vs Data Center
  4. On Premise vs Cloud