Microsoft Dynamics 365 Cloud vs On-premise Comparison
Let’s Understand the Best Deployment for Your Office.
Global enterprises are gradually moving their business applications to various online platforms. Businesses are, however, debating which deployment (in-cloud, on-premise, or as-hybrid) they should pick because each business-case is different and needs to be assessed, accordingly.
There are various aspects, including data security, system integrations, and access to critical information, among others, that businesses consider before deciding to opt any deployment for their business tools.
Dynamics Square Experts are proficiently assisting businesses to explore and understand which Microsoft Dynamics 365 installation is the best for their offices.
Microsoft Dynamics 365 ensures flexibility and comes with these deployment options:
- In-Cloud – hosted by Microsoft
- On-Premise – installed on private servers, and
- As-Hybrid – essentially combines the features of in-cloud and on-premise deployments

Microsoft Dynamics 365 Deployed In-Cloud
Presently, nearly 90% of new Dynamics 365 customers opt for an in-cloud deployment.
Microsoft Dynamics 365 in-cloud deployment ensures numerous capabilities for modern businesses, including information security and flexibility – to increase the users count or to integrate more applications at anytime.
Key Features
- Quick and seamless implementation without incurring additional hardware expense or hiring in house IT resources
- Minimizes overhead spending required to maintain a dedicated private server
- Facilitates consistent product developments along with assured weekly updates
- Releases new features twice in a year
- Zero new license costs and no recurring license renewal expenses with a predictable monthly subscription
- Five layers information security and data protection
- Seamless disaster recovery services, including EU standards and ISO27001 compliance
- Efficiently works on the Microsoft Office 365 platform through a smart integration of SharePoint, Skype Messaging, Hosted
Exchange, and many more - Intelligently executes integrated web portals, Microsoft Social Engagement, and voice of the customer surveys.
- Embedded Artificial Intelligence (AI) capabilities
- Supports applications and tools built on the universal Power platform
Microsoft Dynamics 365 On-Premise Deployment
On-Premise Microsoft Dynamics 365 is essentially deploys on private servers, ensuring absolute control and management of the huge information stored on the internal databases.
Key Features
- Retain full ownership of business information
- Additional investments to be made in existing hardware and IT infrastructure
- Efficiently manage and control the updates related to applications
- Ensures flexibility to employ internal IT professionals or outsource external IT support to manage installed applications
- Generates business focused intelligent reports, including SQL Server Reporting Services (SSRS)
- Minimizes and control online / cloud data storage expenses
- Works seamlessly even with basic internet connection
The below comparison will enable you to precisely understand and decide which Microsoft Dynamics 365 deployment – in-cloud or on-premise – will suite your business requirements.
Key-Capabilities | Microsoft Dynamics 365 – In Cloud | Microsoft Dynamics 365 – On Premise |
---|---|---|
Cost Model | Monthly subscription | Huge initial capital investment (CapEx |
Information Storage | Information stored in secured Microsoft data centre | Complete ownership and control over the stored information |
Data Access | Access only through application program interface (API) or report connectors | Full access |
Storage Space | 5-GB (additional 2.5-GB for every 20 licenses) | Limited to available server storage |
System Administration | Minimal internal administration required Microsoft manages the system infrastructure | Requires internal or vendor partner maintenance |
Deployment | Quick and seamless | Time taking and complicated |
Hardware Requirement | No additional hardware required | Executed either from existing hardware or might need additional servers |
Maintenance Expenses | None | Involves huge spending on maintaining and upgrading servers |
Connectivity | Reliant connectivity with 99.9% financially supported by Microsoft | No internet connectivity required to access applications or information |
System Updates | Updates (both minor and major) rolled out consistently | Minor updates can be held back until the next major release |
Mobility | Applications available for offline access | Applications available for offline access |
Flexibility | Higher flexibility through integrated redundancy capabilities | Hardware dependent and its expensive to install redundant server for back-up |
Power BI | Integrated | Not Available |
Take the next steps for your business
There’s never been a better time to update your systems and take advantage of all the benefits of cloud-based business applications. Learn more about the capabilities of Microsoft Dynamics 365.
Why Dynamics Square?
A trusted Microsoft Dynamics 365 partner in USA with offices in Texas, California and presence across USA for Dynamics 365 services like upgrade, support, integration and any customization. We continually invest to keep our team, assets, relationships, delivery capability and service portfolio at their best. We are a trusted business partner and aid in growing businesses at their pace.

Years of Expertise
Our years of expertise helps us to align ourselves with our customer’s business needs, expectations with Microsoft Business Solutions.

In-depth Knowledge
Our in-depth knowledge of products, technology, and Industry helps us to design the solution that align with our customer’s business needs.

Subject Matter Experts
Our highly experienced team of Professionals having the collective experience of over hundreds of successful Project implementations.
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