On Premise vs Off Premise. What are the Benefits and  Limitations?

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Choosing a cloud computing solution is a critical decision for any organization. It  directly affects the organization’s business in terms of customer experience. For all IT  organizations, having a proper cloud computing solution is not a luxury anymore, it is  a requirement. Now there are two types of cloud solutions – On Premise and Off  Premise. Both have their benefit and limitations, and depending on the organization’s  requirements, you should select the best cloud solution. In this article, I will talk about  both On Premise and Off Premise and how they are different from each other in terms  of the benefits and limitations they have. Let me first start by briefly talking about both  types of cloud solutions. 

What is On Premise? 

On Premise is nothing but your traditional approach where all your data, all your  applications, are hosted in-house. As an owner, you go ahead and buy licensed  software, and you take care of security. It means you write your own piece of code  and own your servers as a company. Employees are responsible for monitoring the 

software and maintaining them, ensuring that these software are correctly deployed.  All these things happen in-house. Now, this is an important point, whether you talk  about having your servers, scaling those servers, making changes to the compute  capacity, your storage capacity or monitoring the applications, dealing with customer  issues, you need to take care of all these things in-house that means at your On  Premise architecture. 

What is Off Premise? 

Off Premise is nothing but using cloud provider premises and not your own. There are  multiple cloud providers which give you all these facilities when it comes to computing.  In the On Premise approach, everything there happened in-house, but in Off Premise, 

when it comes to taking care of computation part or when it comes to building software,  maintaining your applications, what we do is we go ahead and bring in a third-party  vendor who provides us with all these services i.e., computation, storage, database,  monitoring, security, analytics, etc. So, all you must do is focus on your business  needs. And you pay for these services as you use these services. The servers are  located at your vendor’s place and they are hosting your data and your applications  on data centers or servers. 

Now let us understand how On Premise and Off Premise differ from each other. 

On Premise vs Off Premise: Benefits and Limitations  Cost 

Let us start by comparing these two aspects based on the cost. First, we have an On  Premise architecture where we need to pay heavy upfront costs and high maintenance  costs. Previously I mentioned you would be buying a stack of servers and maintain it,  you would be buying licensed software, all these things are very costly.  

But if you compare it with Off Premise, this approach is comparatively different. Here  we get cheaper upfront costs, and it is easy to predict the cost over time. Now when I  say it has cheaper upfront costs, it means you sign up with your vendor, once the deal  is done as to what are your expectations and what you expect out of your vendor, you  can decide how much hardware you want to use, what kind of software you want to  use. The cloud providers give you various services that help you maintain your  applications and your data. This results in lesser cost when it comes to maintaining 

your data. The other thing is it is cheaper because if you need to scale, you can decide  how many servers you want and start with fewer servers as well, so it is again  affordable.


When you talk about security, people are still pretty much in favour of On Premise  architecture. Owner manages security when it comes to On Premise architecture, and  quality boils down to owner experience. So, the owner takes care of quite a few factors  like what compliance policies they want, what kind of security they wish to implement,  and most importantly, all the data resides in-house. you are not worried about factors  like missing out on data, losing out on data, and some downtime you might face when  it comes to your third-party vendors or your cloud computing platform. 

When you talk about Off Premise, the vendor is responsible for the security. Your data  would be residing at a data center, and there are various data centers that these cloud  service providers have. If you talk about Amazon Web Services, these data centers  are decided or taken care of based on locations. There are data centers in the USA,  data centers in India, and many more countries. With your cloud provider, you share  your resources, or you share the space with someone else. People who are dealing  with very security-critical services might refrain from moving to Off Premise. But having  said that, these days, cloud platforms are very secure, and you usually have proper  compliances which ensure that your data stays secure all the time. 


On Premise gives more control over implementation but takes more time to set up. If  you talk about Off Premise, it is easier to implement, and it takes less time to set up.  

In the On Premise, you have more control over quite a few factors because you plan  your architecture. You decide what software you want to use, what kind of servers or  how much space you want to use, and how you want to go ahead and set up your  architecture. So, you have more control in that aspect when it comes to security  because you will be purchasing your license software. But the fact that you are putting  in so much planning, you would need more time to set this architecture or infrastructure  up. 

On the other hand, Off Premise does not give you more control, but it gives you some  additional features. Here the implementation is straightforward. Suppose I wish to use  some servers, I can go ahead and spin those servers right away. I would not have to  worry about going ahead and setting up factors like putting up my servers, having  various virtualization layers, putting up different operating systems, on top of that,  putting my data. So, it has less time to set up.  

But if you talk about overall control, your On Premise architecture would give you more  control and when it comes to Off Premise you are kind of dependent on some factors  with your vendor 


In the On Premise, more customization and flexibility are available to some extent in  certain features. It is about defining your security laws, defining how the data gets  retrieved, etc. Also, there are fewer update issues because you have your own  software, and you maintain it on your own. There is one drawback here, you have to  update your own software and stay updated with the market on your own. That  requires more monitoring and more resources, but you are free to choose the kind of  software you want. 

In the case of Off Premise, things are vendor-specific, but these days, what we see is  no matter what kind of software you are talking about, integration has become a lot  easier. Cloud platforms are also more flexible because it is easier with cloud platforms  when it comes to the overall ease with which you can carry out computing. Cloud  platforms have services that help you perform all your IT tasks in a much better  manner. 

So, it pretty much boils down to what suits your needs better. As I have already  mentioned, if there are certain compliances where you cannot compromise or your  company cannot compromise, you can go for your On Premise architecture. But I feel  that Off Premise these days are more flexible.

Here is a summarized difference between On Premise and Off Premise.

Criteria On Premise Off Premise
Deployment  Deployed at own  infrastructure Deployed at service provider’s infrastructure
Cost  Apart from the resource cost,  you also need to pay for  space and power  consumption Pay only for the resources used
Security  Taken care by a group of  internal staff or a 3rd party in  IT security domain Supported by the cloud provider  with services and policies it  offers
Flexibility  Less scope of flexibility, you  need buy the complete infrastructure and make  changes on your own Very flexible in terms of  upgrading or scaling the  infrastructure
Maintenance  You need to maintain on your  own Cloud provider does the  maintenance for you
Pros  Full control 

No data leaks 

Complete internal  security 

Lower cost for long  term commitment

Quick and easy  deployment 

Automatic integration 

Easy to upgrade and  scale 

Cost efficient

Cons  Recovery and Backup  take time 

Regular updates 

Hardware/software management 

Deployment and  scalability take time

Downtime issues 

Security risks 

Lack of support 

Performance varies with  different cloud providers


Final Thoughts 

Now you know the benefits and limitations for both On Premise and Off Premise. When  you are going for Off Premise, please do a thorough check of their security, privacy,  policies, etc. Make sure their maintenance policies and upgrade schedule are flexible  according to your requirements. And for On Premise, you have multiple options such  as AWS, Microsoft Azure, Google Cloud Platform, which are very well recognized in  the IT industry. You can take a hybrid approach which most big organizations follow,  where for few requirements On Premise is preferable and in few cases Off Premise is  a better solution. Go ahead and try out these cloud computing approaches.

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