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SharePoint Server or SharePoint Online – that is the question

Many business enterprises grapple with the dilemma whether to host their SharePoint on-premises or to settle for what is available on the SharePoint online services that Microsoft offers in its Office 365 offerings. There is a third but less considered option – host SharePoint server on the cloud using the Infrastructure as a Service (Iaas) offered by Microsoft (Azure) or other cloud players.


Any decision, according to Gartner, must be based on the business objective of the enterprise rather than any other consideration. As this question gets complex with the increase in the number of users/user teams, their location, connectivity, security, compliance, privacy and controllability, Gartner has published decision frameworks, decision factors and lists of strengths and weaknesses to help enterprises base their decisions on.


While many enterprises that desired an intranet for their staff have already invested in SharePoint for an on-premises solution (SharePoint Online was a late-comer), with the cloud-first principle, Microsoft has started rolling out a lot of new features in the SharePoint online services that has become attractive and is becoming a deterrent in decision making in support of an on-premises solution. Now, a serious decision is looming in the near future for many enterprises whether to go for the next upgrade of SharePoint server or should the enterprise opt for the cloud services.


Some of the factors that influence a decision are listed hereunder:


Is my enterprise content safe on the cloud?


A number of enterprises are still worried about the security of their content. With news of data breaches happening all around the web, this is a factor of grave concern for the enterprises. Many of them still hesitate to consider the online services as a safe bet and are not ready to move their content to the cloud due to legal constraints. While Microsoft, one of the most trusted IT companies in the world, has come up with a lot of information on its trust center about the various steps it has taken to make the enterprise content secure and about the various certification that it has acquired over the years (http://azure.microsoft.com/en-us/support/trust-center/ ), it still fails to offset the fears in the mind of the enterprise decision makers. They would rather live with their content in their datacenter and risk a breach than trust it to a third party vendor.


Where is my data?


Many business enterprises that provide services to their customers and clients are facing this question – where is my data located in the cloud? Many of them are bound by legal compliance requirements that prohibit them from moving their data beyond their national boundaries. Customers and clients might consider it a threat to allow their data to be held in a country that might not align with their political, religious or cultural convictions. While Microsoft allows enterprises to choose a zone of their choice for holding their content on the azure services, it is not so transparent with respect to the Office 365 services.


How is the connectivity?


While a SharePoint server might require only a LAN connectivity, SharePoint online would require an always online kind of a WAN connectivity for accessing content. Many developing countries are still facing a problem of poor internet connectivity which might be a very important factor that influences the decision against SharePoint online services. While there is the 3G and 4G connectivity that is becoming popular lately in the urban areas, this might not be the case in places  that are far removed from the cities where the manufacturing centers are located – in industrial estates and export processing zones that have limited connectivity even today.


How much do I get to store?


SharePoint online provides 500 mb per user subscription apart from the 10GB available for the enterprise. This might become a limitation where the enterprise is content-intensive. While additional space for storage of the content can be bought from the service provider, this might be considered as an additional expense and there might not be an upper predictable limit for budgeting purposes.


Will my search be fast enough?


As SharePoint is made available in a multitenant environment, search capabilities might be slow and not give the user as good an experience as an on-premises solution. There is a potential scalability concern when it comes to the online services.


What limit of customization do I want?


With a SharePoint on-premises solution, there is a possibility of extensive customization. Enterprises can make the solution as user friendly as possible. With the SharePoint designer, a lot of apps can be built in to the solution to make the platform a real collaborative entity. SharePoint online provides limited customization options.


How much am I going to spend?


The online services is available at a fractional cost of the on-premises solution and comes in a subscription model. The underlying infrastructure is of no worry to the enterprise and does not require the upkeep of it. The personnel for maintaining the solution and their skill set requirements become minimal. An on-premises solution would require a Windows server, the respective client access licenses, SQL server, the SharePoint server and the client access licenses and a double investment for high availability scenarios.


How fast do I want to roll out / scale up the solution?


An On-premises SharePoint solution requires details architectural planning and the roll out might take several months. The end-user waiting time for this solution might at some time sap the enthusiasm of the users. An online solution would shorten this time significantly as the infrastructure is readily made available by the service provider. And scaling up and down depending on the requirement is possible in an online solution as it is a pay for what you use model. Scaling down on the number of users in an on-premises model will only reduce the Return on investment (RoI) significantly.


The third option – Hosting the SharePoint server on the cloud


This might be an option that enterprises might want to consider if they are financially crunched on acquiring fresh hardware or provision existing hardware for this SharePoint solution. In this case, not only have they to pay the vendor for IaaS but also have to pay for the software Server licenses and CALS. And the responsibility of running and upkeep of the solution is on the shoulders of the internal IT admins.



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