Microsoft Dynamics 365: Cloud Vs On-Premises Deployment


Dynamics 365 Deployment: Cloud Vs On-Premises

Exploring the curious case of deploying Microsoft Dynamics 365

Deciding and deploying a whole new business app can be arduous at times. But since you have already decided to go with `Microsoft, you have already won half the battle. And hopefully, for the remaining half, we, the Dynamics Square team, will help you to come to a concrete decision on how to deploy Dynamics 365 products or the best way to do it: on-premises or in-cloud.

Remember: Since the launch of MSFT Dynamics 365 in 2016, over 80% chose to deploy it in the cloud. Why? Simple! Low deployment and maintenance costs.

So, you have multiple choices to host your new Dynamics 365 solution, thanks to Microsoft's backtracking decision after realizing that on-premises or the demand for locally hosted software is still high. Meaning, you have three ways of deploying Dynamics 365 module(s): via the cloud, local hosting, or hybrid deployment. The latter two are more costly than the cloud deployment option.

Microsoft Dynamics 365: The Options for App Deployment

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Hosted in the Microsoft Cloud by Microsoft. No hosting cost due to the Pay-as-you-Go model



Hosted or installed on Private Servers, leaving you footing the bill



The amalgamation of in-cloud and on-premises deployment features

Deploying MSFT Dynamics 365 In-Cloud

Stay connected, stay agile, and be more productive anytime, anywhere.

The in-cloud deployment of Microsoft Dynamics 365 ensures numerous growth opportunities for modern businesses, from data security and flexible communication among different teams to increasing customer engagement, enhancing customer experience, and integrating more apps to take control of all business operations.

Key Features and Capabilities

Implementation Costs

The quick and seamless implementation of Dynamics 365 without expending additionally on buying new hardware or in-house IT resources makes it one of the top ERP solutions picked among global manufacturing groups and big corporations.

Overhead Expense

The Microsoft cloud facility minimizes the overall overhead spending to maintain a dedicated private server to operate and run your business operations.

Business Continuity

The AI-driven intelligence of Dynamics 365 is excellent and facilitates continuous product development while assuring necessary consistent updates.

New Features

Investing in people-friendly technology is Microsoft's topmost priority. To do more with less mission, Microsoft releases feature updates twice a year. The software updates not only add new features but also improve security and quality.

Recurring Costs

None. Nill/Zero cost for a new license or renewing the existing license.


Security Layers

Microsoft is the world's leading provider of information security and data protection. By deploying Azure cloud infrastructure, Microsoft offers multiple layers of security that protect people and data from cyber threats.

Data Recovery

Natural disasters such as hurricanes, floods, wildfires, and earthquakes can cripple IT organizations. Also, equipment failure, cyberattacks, and power outages pose a serious need for disaster recovery planning required for business continuity.

Microsoft's Azure cloud computing platform offers Disaster recovery as a service or DRaaS, allowing you to back up your data and IT infrastructure with full access and functionality to recover after a disaster.

Power Integrations

Microsoft Dynamics 365 offers seamless integration with Office 365 apps such as SharePoint, Skype, Messaging, Hosted Exchange, Excel, and more. It also allows smooth integration with other Dynamics 365 business apps and business intelligence apps like Power BI.

Integrated Web

As part of Dynamics 365, you can create custom web apps and portals while incorporating embedded artificial intelligence (AI) with Power Apps to gain a deeper understanding of your employees and customers.

Future Investment

Planning to invest in Microsoft Dynamics 365 is choosing to invest in a better future. Cloud, AI/ML, IoT, IIoT, data security, and alike tech are hard to avoid due to their capabilities to make smart and fast decisions that can save billions of dollars and millions of lives.

Deploying MSFT Dynamics 365 On-Premises

Ensure absolute control over your information and data by deploying Dynamics 365 on your private servers. Run your business processes in on-remises customer data centers.

Key Features and Capabilities

Full Ownership

By deploying Dynamics 365 on-premises, you choose to own your data and critical business information to run your business the way you want.

Implementation Costs

Deploying Dynamics 365 on-premises is more expensive than deploying it in the cloud due to additional hardware and IT infrastructure investments.

Software Updates

The users are free to choose whether to update their modules or not whenever Microsoft releases feature updates.


Focused Intelligence

Using SQL Server Reporting Services (or SSRS), you can generate business-focused intelligent reports to help you understand your organization more so that you can innovate more and solve more problems.

Business Continuity

With an on-premises deployment of Microsoft Dynamics 365, you can avoid network outages, reboots, and downtime experienced with in-cloud deployments.

Work Efficiency

Every organization strives for work efficiency for better production and hence high profits. By deploying Dynamics 365 on-premises you can ensure it but up to a certain limit as compared to its in-cloud deployment.

Create a hyperconnected organization that connects people, data, and processes. By doing this, you can drive more efficiency, reduce overall costs, quickly adapt to changing markets across the globe and invest in the right innovation at the right time.

cloud vs on-premises

Looking to Migrate from Dynamics 365 On-Premise to the Cloud?

It's Time To Modernize Your Current On-Premise Solutions By Migrating To The Cloud.

Dynamics 365 In-Cloud Vs On-Premises Deployment: Comparison Table

CriteriaMSFT Dynamics 365: In CloudMSFT Dynamics 365: On-Premises
Cost ModelMonthly subscriptionHuge initial capital investment (CapEx
Storage Space5 GB (additional 2.5 GB for every 20 licenses)Limited to available server storage
Hardware RequiredNoNeeds existing hardware or additional servers
Connectivity Reliable connectivity backed by Microsoft to 99.9%No need for an internet connection to access apps, data, or info
MobilityOffline availability of apps for access other than online accessOnly available for offline access
DeploymentQuick and easyTime-consuming and complex
Maintenance ExpensesNoneHigh maintenance and upgrading server costs
System UpdateConsistent automatic release of updates (both minor and major)Option to delay minor updates until the next major release
Data AccessOnly via API (Application Programming Interface) or report connectorsFull Access
Information StorageIn highly secured Microsoft Data Centers across the globe via Microsoft AzureOwnership of the installed systems and full control over stored information

Storms come and go. What remains is our will to get up and start running. So, stop procrastinating, start embracing the change, and move your business operations to the cloud and running like never before. It will not only help you modernize your current/legacy ERP/CRM on-premises solutions but will also make you future-ready.

Access the technology of the future today. Control costs and complexity. Improve your organization's productivity with our Dynamics 365 experts. We help businesses accelerate their digital transformation journey while minimizing risk.

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