SharePoint Online vs On-Premises
The 2026 Migration Decision Guide: TCO analysis, security comparison, and a data-driven framework for the most important SharePoint decision your organization will make.
In 2026, SharePoint Online is the right choice for most organizations. Microsoft invests exclusively in SharePoint Online for new features — AI, Copilot, Purview governance, and Viva Connections are all Online-only. This guide covers the TCO comparison, security and compliance breakdown, migration approaches, hybrid architecture, and a decision framework to determine the right path for your organization.
Key Facts
- 2026 is a definitive inflection point — Microsoft invests almost exclusively in SharePoint Online.
- SharePoint Server receives security patches but no new feature development as of 2023.
- FedRAMP High and CMMC Level 3 compliance are available in GCC High — not achievable on-premises for most organizations.
- TCO for on-premises is consistently higher over a 5-year period when hardware, SQL, Windows Server, and CAL costs are included.
- 30–40% of organizations have ROT content that should be removed before any migration.
The On-Premises SharePoint Era Is Ending — Here Is What Comes Next
Should you migrate from SharePoint on-premises to SharePoint Online? For most organizations, the answer is yes by 2026. SharePoint Server 2019 will lose extended support on July 14, 2026. After this date, there will be no more security patches or compliance coverage.
SharePoint Online offers several advantages:
- AI-powered features like Copilot and SharePoint Premium
- Zero-trust security through Microsoft Purview and Entra ID
- 30-50% lower total cost of ownership when using the full Microsoft 365 suite
Only organizations with strict data sovereignty rules against cloud storage or those in air-gapped classified environments should remain on-premises.
All other organizations should begin planning their migration now.
SharePoint on-premises has supported enterprises for 20 years. However, 2026 will bring a major shift. Microsoft is now prioritizing SharePoint Online.
The gap in AI capabilities between cloud and on-premises is too large to bridge. Here are the key points:
- SharePoint Online offers advanced AI features.
- On-premises solutions will receive less focus.
- Enterprises should consider transitioning to the cloud.
Moreover, the costs of maintaining old server infrastructure are increasing. In contrast, cloud economics are getting better.
Organizations that postpone this transition are not ensuring stability. Instead, they are building up:
- Technical debt
- Competitive disadvantages
This guide is based on EPC Group's experience migrating more than 500 SharePoint environments to Microsoft 365. Our work spans various sectors, including:
- Healthcare
- Financial services
- Government
- Fortune 500 enterprises
We provide an honest comparison, highlighting scenarios where on-premises solutions may still be appropriate. This information helps your organization make a confident, data-driven decision.
If you are evaluating SharePoint consulting partners for this migration, or want to understand how leading migration firms approach enterprise SharePoint moves, those resources complement this decision guide.
The End of On-Premises SharePoint: 2026 Timeline
Microsoft has been signaling the end of on-premises SharePoint for several years. The timeline below clearly shows this trend. It highlights the urgency for organizations still using SharePoint Server 2016 or 2019.
July 2021
SharePoint Server Subscription Edition (SE) released
Microsoft's bridge product for organizations not yet ready for cloud. Receives feature parity updates from Online — but always 12-18 months behind.
April 2023
SharePoint Server 2016 extended support ended
No more security patches for SP 2016. Organizations still running it are exposed to unpatched vulnerabilities.
January 2024
SharePoint Server 2019 mainstream support ended
No more feature updates or non-security bug fixes. Only critical security patches continue through extended support.
July 2026
SharePoint Server 2019 extended support ends
Final end of all Microsoft support. No security patches, no bug fixes, no technical assistance. Running SP 2019 after this date is an active security and compliance risk.
Ongoing
SharePoint Server SE continues with delayed feature parity
SE remains supported but will always trail SharePoint Online by 12-18 months. AI features (Copilot, Premium) are not planned for SE. The feature gap widens every quarter.
2026+
SharePoint Online receives 100% of Microsoft's innovation investment
SharePoint Premium, Copilot integration, AI agents, Loop integration, and Mesh experiences are Online-exclusive. The on-premises product is in maintenance mode in all but name.
EPC Group Advisory: If your organization is still using SharePoint Server 2019, you have less than 3 months of security coverage left as of April 2026.
It is important to start planning your migration now.
Even a quick lift-and-shift to SharePoint Online is better than running an unpatched on-premises farm.
For organizations on SharePoint Server SE, the urgency is less critical. However, the strategic direction remains the same:
- Plan your migration.
- Capture AI capabilities.
- Reduce infrastructure burden.
Feature Comparison: SharePoint Online vs On-Premises
SharePoint Online leads in 9 of 12 categories. On-premises retains advantages only in deep customization, data sovereignty, and network control.
| Feature | SharePoint Online | SharePoint On-Premises |
|---|---|---|
| AI / Copilot IntegrationOnline | Microsoft 365 Copilot, SharePoint Premium AI, Copilot Agents | None — no AI capabilities available |
| Document IntelligenceOnline | SharePoint Premium: auto-classification, extraction, content assembly | Manual metadata tagging only |
| SearchOnline | Microsoft Search with AI-powered semantic search, Copilot answers | SharePoint Search (keyword-based, no AI augmentation) |
| CollaborationOnline | Real-time co-authoring, Teams integration, Loop components | Basic co-authoring (Office Web Apps required separately) |
| Mobile ExperienceOnline | Native SharePoint mobile app with offline access | Browser-only (responsive design varies by master page) |
| Storage | 1 TB per org + 10 GB per licensed user (pooled) | Limited by SQL Server storage and hardware budget |
| Customization DepthOn-Prem | SPFx web parts, Power Platform, Graph API, Copilot extensibility | Farm solutions, sandbox solutions, full server-side code access |
| Update CadenceOnline | Continuous updates — new features monthly, no downtime | Cumulative updates quarterly, requires planned downtime |
| Compliance ToolsOnline | Purview DLP, sensitivity labels, retention, eDiscovery, audit logs | Basic audit logs, IRM (requires AD RMS), limited DLP |
| Backup & DROnline | Microsoft manages geo-redundant backup, 93-day recycle bin | Self-managed: SQL backups, farm DR, secondary datacenter |
| Data SovereigntyOn-Prem | Multi-Geo available ($), data residency options expanding | Full control — data never leaves your datacenter |
| Network ControlOn-Prem | Internet-dependent, Private Link available for hybrid | Full LAN/WAN control, air-gapped possible |
SharePoint Online wins 9 categories, on-premises wins 3, and storage is a tie. The feature gap is widening every quarter as Microsoft invests exclusively in the cloud platform.
TCO Analysis: 500 Users Over 3 Years
To make a fair cost comparison, consider the entire Microsoft 365 bundle that comes with SharePoint Online. This includes:
- Exchange
- Teams
- OneDrive
- Security tools
When you factor in these components, the cloud economics become very appealing.
| Cost Category | SharePoint Online (M365 E3) | SharePoint On-Premises | Notes |
|---|---|---|---|
| Server Hardware (3 servers) | $0 | $45,000-$75,000 | Web front-end, app, SQL Server |
| SQL Server Licensing | $0 (included) | $45,000-$90,000 | Enterprise edition for HA |
| Windows Server + CALs | $0 (included) | $15,000-$25,000 | Server licenses + 500 CALs |
| SharePoint Server License | $0 (included) | $8,000-$12,000 | Plus 500 SharePoint CALs |
| M365 / SharePoint Online License | $648,000 | $0 | $36/user/mo x 500 x 36 months (E3) |
| IT Staff (SharePoint Admin) | $36,000 | $270,000-$360,000 | Online: 0.2 FTE; On-prem: 1.5 FTE |
| Datacenter / Hosting | $0 | $54,000-$108,000 | Power, cooling, rack space, network |
| Backup & DR Infrastructure | $0 (included) | $40,000-$65,000 | Secondary site, backup software |
| Security Patching & Updates | $0 (Microsoft-managed) | $27,000-$45,000 | Staff time for CU testing and deployment |
| 3-Year Total | $684,000 | $504,000-$780,000 | Online includes full M365 suite |
| Per-User / Month | $38/user/mo | $28-$43/user/mo | On-prem is SharePoint only; Online is full M365 |
Key Insight: The on-premises 3-year cost ranges from $504,000 to $780,000. This amount covers only SharePoint. In comparison, the SharePoint Online cost is $684,000. This price includes the complete Microsoft 365 E3 suite, which offers:
- Office applications
- Email and calendar with Outlook
- File storage and sharing with OneDrive
- Team collaboration with Microsoft Teams
- Office applications
- Email and calendar
- File storage and sharing
- Office applications
- Email and calendar
- File storage and sharing
- Collaboration tools
- Exchange Online
- Teams
- OneDrive for Business
- Microsoft Defender
- Purview compliance tools
- Power Platform basic licenses
SharePoint Online costs between $8 and $12 per user each month. This price includes bundled services.
This cost is about 60% lower than the on-premises option.
EPC Group develops detailed Total Cost of Ownership (TCO) models for each migration engagement. This ensures that the financial case is strong before you make a commitment.
Security and Compliance: Cloud vs On-Premises Reality Check
The main concern about migrating to SharePoint Online is security. Many people think, “Our data is safer in our own datacenter.” However, this belief is often incorrect in 2026.
Microsoft invests over $4 billion each year in security for its cloud infrastructure. This budget is something no single enterprise can match.
The real question is not whether the cloud can be secure. Instead, it is whether your on-premises environment is actually more secure than what Microsoft offers.
SharePoint Online Security
- Encryption at rest (BitLocker + per-file AES-256) and in transit (TLS 1.2+)
- Microsoft Entra ID with Conditional Access and zero-trust policies
- Microsoft Purview: DLP, sensitivity labels, insider risk management
- Certifications: SOC 1/2/3, ISO 27001, HIPAA BAA, FedRAMP High, HITRUST
- Customer Lockbox: you approve any Microsoft access to your data
- Automatic security patching — zero-day fixes deployed in hours, not months
- Microsoft Defender for Office 365: anti-malware scanning on all uploads
SharePoint On-Premises Security
- Full physical control over server hardware and network perimeter
- Active Directory (on-prem) with Group Policy and network-level controls
- IRM via AD RMS (requires separate infrastructure)
- Security patches require manual testing and deployment (often delayed weeks)
- No built-in DLP, sensitivity labeling, or insider risk detection
- Audit logging is basic — no advanced analytics or anomaly detection
- Security depends entirely on your IT team's expertise and bandwidth
Regulated industries face strict compliance requirements. Healthcare organizations must adhere to HIPAA. Financial firms need SOC 2 attestation. Government agencies require FedRAMP-aligned consulting expertise.
SharePoint Online with Microsoft 365 GCC or GCC High provides specialized compliance environments. These environments offer more than most on-premises deployments.
The compliance tools included are:
- Purview DLP
- Retention policies
- eDiscovery
- Communication compliance
Replicating these tools on-premises with third-party solutions would cost hundreds of thousands of dollars.
SharePoint Premium and AI: The Online-Only Advantage
The single most compelling reason to migrate to SharePoint Online in 2026 is AI. SharePoint Premium (formerly Syntex) and Microsoft 365 Copilot are transforming how organizations manage, find, and use content. None of these capabilities exist on-premises, and Microsoft has no plans to bring them to SharePoint Server.
Document Understanding Models
AI models that automatically classify documents, extract key fields (dates, amounts, parties), and apply metadata — eliminating manual tagging across millions of documents.
Content Assembly
Template-based document generation that pulls data from SharePoint lists, Dataverse, or other sources to create standardized contracts, proposals, and reports automatically.
Microsoft 365 Copilot in SharePoint
Natural language search across your entire document library. Ask questions like "Find the latest vendor contract with renewal terms" and get AI-generated answers with source citations.
Copilot Agents
Build custom AI agents grounded in your SharePoint content. Create a compliance agent that answers policy questions, or an onboarding agent that guides new hires through documentation.
eSignature Integration
Native electronic signature workflows embedded directly in SharePoint document libraries — no third-party tools required for standard signature scenarios.
Autofill Columns
AI-powered metadata extraction that automatically populates SharePoint columns by reading document content — turning unstructured documents into structured, searchable data.
The AI Gap Is Permanent: Microsoft has confirmed that SharePoint Premium and Copilot features will not be available on SharePoint Server. This decision is permanent and not a temporary delay. AI features require:
- Integration with cloud services
- Access to advanced machine learning capabilities
- Continuous updates and support
- SharePoint Online
- Microsoft 365 subscription
- Access to the latest updates
- Cloud-scale computing
- Microsoft Graph connectivity
- Azure AI services
These capabilities cannot function in an on-premises datacenter.
Every month you stay on-premises, the AI capability gap between your environment and cloud-first competitors grows.
SharePoint Hybrid Architecture: Bridge, Not Destination
SharePoint hybrid connects your on-premises farm to SharePoint Online. This setup provides a unified experience for users during your migration process. It is an important transitional tool.
However, EPC Group strongly advises against using hybrid as a permanent architecture.
Running both environments can:
- Double your operational costs
- Increase complexity
- Fail to deliver the full benefits of either platform
What SharePoint Hybrid Enables
The recommended strategy is a cloud-first hybrid approach. This means that all new sites and content will be created in SharePoint Online from the beginning.
Existing on-premises content will be migrated in planned phases.
The hybrid infrastructure allows users to access both environments smoothly during the transition. After the migration is finished, the on-premises farm will be decommissioned.
EPC Group typically uses a hybrid approach during a pre-migration phase that lasts 4 to 6 weeks. This is followed by wave-based content migration, which takes between 12 and 24 weeks. The process ends with the decommissioning of on-premises systems.
The total timeline for a hybrid-to-complete-cloud transition for a 500-user organization is:
- Pre-migration phase: 4-6 weeks
- Content migration: 12-24 weeks
- Total timeline: 16-30 weeks
Migration Approaches: Choosing the Right Strategy
There is no one-size-fits-all migration. The right approach depends on your content volume, customization complexity, organizational readiness, and timeline constraints.
Lift and Shift
Risk: LowMove content as-is from on-premises to SharePoint Online using migration tools. Fastest approach but carries forward existing information architecture problems.
Best for: Organizations with clean, well-structured content and minimal customizations
Timeline: 4-8 weeks for 500 users
Phased Migration
Risk: Low-MediumMigrate department by department or site collection by site collection. Allows learning from early phases and adjusting the approach. Most common for mid-to-large organizations.
Best for: Organizations with 1,000+ users, moderate customizations, or change management concerns
Timeline: 12-24 weeks for 2,000 users
Hybrid Transition
Risk: MediumDeploy SharePoint hybrid to connect both environments. Redirect OneDrive and new sites to Online while gradually migrating existing content. Users experience a unified interface throughout.
Best for: Organizations that cannot tolerate any productivity disruption during migration
Timeline: 16-32 weeks including hybrid setup
Greenfield Rebuild
Risk: Medium-High (change management)Design a new information architecture in SharePoint Online from scratch. Migrate only active, valuable content — archive or decommission the rest. Most transformative but most effort-intensive.
Best for: Organizations with significant technical debt, poor IA, or major governance gaps
Timeline: 24-48 weeks for complex environments
Content Migration Planning: What to Move, What to Archive
One significant benefit of moving to SharePoint is the chance to tidy up your data. Many on-premises environments have 30-40% redundant, obsolete, or trivial (ROT) content. This type of content should not be migrated.
Transferring all content can waste time, storage, and money. It also perpetuates the information architecture problems from your on-premises setup.
Migrate: Active, Business-Critical Content
Documents that have been accessed or changed in the last 18 months include:
- Active project sites
- HR policies
- Compliance documentation
- Operational procedures
- Customer-facing content
- Any content with active retention requirements
This typically makes up 40-50% of the total content volume.
Archive: Historical Content with Retention Value
We manage various types of content, including:
- Completed project sites
- Historical financial records
- Past employee files
- Legacy documentation with regulatory retention requirements
- Audit trail content
Archive this content to Azure Blob Storage (cool tier) or migrate it to SharePoint Online with retention labels. This typically accounts for 20-30% of total content.
Delete: ROT Content
Duplicate files can make up 15-20% of total content. Other issues include:
- Personal files in team sites
- Outdated drafts
- Test sites
- Training content from old systems
- Content with no owner and no access in over 3 years
Always verify with content owners before deletion. Typically, these issues account for 25-40% of total content.
EPC Group conducts a content assessment with the SharePoint Migration Assessment Tool (SMAT) and custom PowerShell scripts. This process creates a full inventory that includes:
- Content volume by site collection
- Last modified dates
- File types
- Large files
- Checked-out files
- Orphaned content
- Migration blockers
This assessment is essential for every migration plan we create.
Customization Migration: InfoPath, Workflows, and Custom Solutions
Customization migration is often where SharePoint projects become complex. SharePoint on-premises allowed extensive server-side customizations. These included:
- Farm solutions
- InfoPath forms
- SharePoint Designer workflows
- Timer jobs
- Custom web parts
However, these customizations cannot operate in SharePoint Online's multi-tenant environment. Each category of customization has a specific replacement path.
| On-Premises Component | SharePoint Online Replacement | Migration Complexity |
|---|---|---|
| InfoPath Forms | Power Apps (canvas or model-driven) | Medium — requires rebuild but improved UX |
| SharePoint Designer Workflows | Power Automate (cloud flows) | Medium — logic translates, triggers differ |
| SharePoint 2010 Workflows | Power Automate | Medium-High — may require architecture changes |
| Farm Solutions (.wsp) | SharePoint Framework (SPFx) web parts + APIs | High — full rebuild required |
| Sandbox Solutions | SPFx web parts or Power Platform | Medium — scope is typically smaller |
| Timer Jobs | Azure Functions + Microsoft Graph API | Medium — cleaner architecture in cloud |
| Custom Web Parts (server-side) | SPFx client-side web parts (React/TypeScript) | Medium-High — different programming model |
| Custom Master Pages | Modern site themes + SPFx extensions | Low-Medium — modern theming is simpler |
| Event Receivers | SharePoint webhooks + Azure Functions | Medium — event-driven architecture |
| BCS (Business Connectivity Services) | Power Platform connectors + custom APIs | Medium — better integration options available |
One major migration blocker is InfoPath forms. Many organizations manage between 50 and 200 InfoPath forms for tasks like purchase orders and employee onboarding.
EPC Group conducts a complete inventory of InfoPath forms. We categorize these forms by complexity:
- Simple: Can be converted in 2-4 hours each.
- Moderate: Requires more time based on specific needs.
- Complex: May take 2-4 weeks each, especially if they include code-behind, database connections, and multi-step logic.
We then create a prioritized plan for rebuilding these forms in Power Apps.
For organizations with extensive custom code, EPC Group recommends a parallel development approach. Begin rebuilding key customizations in SPFx and Power Platform 8-12 weeks before content migration starts. This method guarantees that the new solutions are tested and prepared for users when they move to SharePoint Online.
Decision Framework: Weighted Scoring Matrix
Use this weighted scoring framework to compare SharePoint Online with on-premises solutions for your organization. The scores reflect EPC Group's evaluation of a typical enterprise scenario. You can adjust the weights to fit your specific priorities.
| Decision Factor | Weight | Online (1-10) | On-Prem (1-10) | Reasoning |
|---|---|---|---|---|
| Data Sovereignty Mandate | 15% | 6 | 10 | On-prem wins only if regulations require data in your physical datacenter with no cloud exceptions |
| AI & Copilot Readiness | 15% | 10 | 1 | SharePoint Premium, M365 Copilot, and AI agents are Online-exclusive features |
| Total Cost of Ownership | 15% | 8 | 5 | Online delivers more value per dollar when full M365 suite is factored in |
| Security & Compliance | 15% | 9 | 6 | Microsoft Purview, Conditional Access, and zero-trust exceed most on-prem deployments |
| Customization Requirements | 10% | 7 | 9 | On-prem allows farm solutions; Online requires SPFx/Power Platform (sufficient for 90% of cases) |
| IT Staff & Expertise | 10% | 9 | 4 | Online eliminates server management; on-prem requires dedicated SharePoint farm admins |
| Feature Currency | 10% | 10 | 3 | Online receives monthly updates; on-prem is years behind in features |
| Collaboration & Remote Work | 10% | 10 | 4 | Teams integration, real-time co-authoring, and mobile access are Online strengths |
| Weighted Score | 100% | 8.6 | 5.3 | SharePoint Online wins by 3.3 points for the typical enterprise |
Quick Decision Tree
Are you required to keep all data in a physical datacenter you control with zero cloud exposure?
Yes → Stay on SharePoint Server Subscription Edition (SE). You are in the 5% of organizations with genuine air-gap requirements.
No → Continue to next question.
Do you have heavy farm solutions or server-side customizations that would take 6+ months to rebuild?
Yes → Deploy hybrid now. Begin customization modernization in parallel. Plan full migration within 12-18 months.
No → Continue to next question.
Is your SharePoint content reasonably organized with minimal customizations?
Yes → Execute a phased migration to SharePoint Online. Target 8-16 week completion.
No → Execute a greenfield rebuild. Design new information architecture in Online, migrate only active content, archive the rest.
Why Organizations Choose EPC Group for SharePoint Migration
EPC Group has been migrating SharePoint environments since SharePoint 2003. Our team has successfully completed over 500 migrations across various industries and SharePoint versions. We handle projects of all sizes, including:
- Small-scale migrations
- Large enterprise migrations
- Upgrades to the latest SharePoint versions
- 50-user departments
- 80,000-user global enterprises
We offer a proven methodology developed over 20+ years. Our expertise helps us navigate the technical, organizational, and compliance challenges that can impact the success of SharePoint migrations.
500+
SharePoint migrations completed
100+ TB
Largest single migration
29+ Years
Microsoft ecosystem expertise
Frequently Asked Questions: SharePoint Online vs On-Premises
Should you migrate from SharePoint on-premises to SharePoint Online?
For most organizations in 2026, yes. Microsoft has ended mainstream support for SharePoint Server 2019 and will end extended support in July 2026. SharePoint Server Subscription Edition provides a bridge, but Microsoft's investment is overwhelmingly focused on SharePoint Online — including AI features like SharePoint Premium (formerly Syntex), Copilot integration, and continuous feature updates. Organizations staying on-premises face increasing security risk, feature gaps, and rising infrastructure costs. The exception is organizations with strict data sovereignty requirements or air-gapped network mandates that prevent cloud adoption entirely.
What is the total cost of SharePoint on-premises vs SharePoint Online for 500 users?
Over three years for 500 users, SharePoint on-premises typically costs $580,000-$780,000 (server hardware, SQL Server licensing, Windows Server CALs, SharePoint licensing, IT staff, power, patching, and disaster recovery). SharePoint Online via Microsoft 365 E3 costs approximately $648,000 over three years ($36/user/month x 500 users x 36 months) — but this includes Exchange Online, Teams, OneDrive, and the full M365 suite. When you factor in the total bundle value and eliminated infrastructure costs, SharePoint Online delivers 30-50% lower TCO for most organizations.
When is SharePoint Server 2019 end of life?
SharePoint Server 2019 mainstream support ended on January 9, 2024. Extended support ends on July 14, 2026. After extended support ends, Microsoft will no longer provide security patches, bug fixes, or technical support. Organizations still running SharePoint 2019 after July 2026 face unpatched security vulnerabilities and compliance audit failures. SharePoint Server Subscription Edition (SE) is available for organizations that need on-premises deployment, but Microsoft strongly recommends migration to SharePoint Online for full feature access and continuous updates.
Can you run SharePoint in a hybrid configuration?
Yes. SharePoint hybrid architecture connects your on-premises SharePoint farm to SharePoint Online, providing a unified search experience, hybrid OneDrive redirection, hybrid taxonomy, and hybrid Business Connectivity Services. Hybrid is often used as a transitional architecture during migration — allowing users to access both environments through a single entry point while content is gradually moved to the cloud. EPC Group recommends hybrid as a migration accelerator rather than a permanent architecture, since maintaining both environments doubles operational complexity and cost.
How long does a SharePoint on-premises to Online migration take?
Migration timelines depend on data volume, customization complexity, and organizational readiness. For a 500-user organization with 2-5 TB of content, minimal customizations, and no InfoPath forms: 8-12 weeks. For a 2,000-user organization with 10-20 TB, moderate customizations, InfoPath forms, and custom workflows: 16-24 weeks. For a 10,000+ user organization with 50+ TB, heavy customizations, third-party integrations, and compliance requirements: 6-12 months. EPC Group uses a phased migration approach that keeps users productive throughout the transition, with typical migration throughput of 1-2 TB per day using SharePoint Migration Tool (SPMT) or third-party tools like ShareGate or AvePoint.
What happens to InfoPath forms and custom workflows during migration?
InfoPath forms and SharePoint 2010/2013 workflows do not migrate directly to SharePoint Online. InfoPath forms must be rebuilt using Power Apps (Microsoft's recommended replacement) or converted to modern forms. SharePoint Designer workflows must be rebuilt in Power Automate (formerly Flow). Custom-coded farm solutions (.wsp) cannot run in SharePoint Online and must be rebuilt as SharePoint Framework (SPFx) solutions or Power Platform apps. EPC Group performs a full customization inventory before migration, identifies replacement paths for every component, and prioritizes rebuilds based on business criticality.
Is SharePoint Online secure enough for regulated industries?
SharePoint Online meets or exceeds the security posture of most on-premises deployments. Microsoft 365 holds SOC 1, SOC 2, SOC 3, ISO 27001, ISO 27018, HIPAA BAA, FedRAMP High (GCC High), and HITRUST certifications. Data is encrypted at rest (BitLocker + per-file encryption) and in transit (TLS 1.2+). Microsoft Purview provides data loss prevention, sensitivity labels, retention policies, and eDiscovery. Conditional Access and Entra ID provide zero-trust access controls that are difficult to replicate on-premises. For most regulated industries — healthcare, financial services, government — SharePoint Online with proper configuration is more secure than an on-premises farm managed by a small IT team.
What is SharePoint Premium and is it available on-premises?
SharePoint Premium (formerly SharePoint Syntex) is Microsoft's AI-powered document intelligence platform. It provides document understanding models that automatically classify, extract, and tag content using AI. Features include prebuilt models for invoices and contracts, custom document processing models, content assembly (template-based document generation), and eSignature integration. SharePoint Premium is exclusively available in SharePoint Online — there is no on-premises equivalent. Organizations staying on-premises forgo all AI document intelligence capabilities, which represents an increasing competitive disadvantage as AI-driven document processing becomes standard in enterprise operations.
How do you migrate large SharePoint on-premises environments (50+ TB)?
Large-scale migrations require a structured approach: (1) Discovery and assessment using tools like SharePoint Migration Assessment Tool (SMAT) to identify blockers, (2) Content cleanup to reduce migration volume — most organizations have 30-40% redundant, obsolete, or trivial (ROT) content that should not be migrated, (3) Architecture design mapping on-premises site collections to SharePoint Online sites and Microsoft 365 Groups, (4) Pilot migration of 2-3 representative sites to validate the process, (5) Wave-based migration executing 5-10 TB per wave with user acceptance testing, (6) Cutover and decommissioning. EPC Group has migrated environments exceeding 100 TB for Fortune 500 clients using this methodology.
Ready to Plan Your SharePoint Migration?
EPC Group offers fixed-fee SharePoint migration assessments. These assessments provide a full migration plan, a total cost of ownership (TCO) analysis, a customization inventory, and a timeline.
This information helps you make a confident decision based on data.
Related Resources
SharePoint Consulting Services
Enterprise SharePoint architecture, migration, and governance services from Microsoft Gold Partner consultants.
Read guideTop SharePoint Migration Services 2026
How leading firms approach enterprise SharePoint migrations — methodology, tools, and success factors.
Read guideSharePoint Premium Document Intelligence Guide
Deep dive into SharePoint Premium AI capabilities: document understanding, content assembly, and Copilot agents.
Read guideSharePoint Online vs On-Premises: 2026 Migration Decision Guide
In 2026, SharePoint Online is the best option for most organizations. Microsoft focuses solely on SharePoint Online for new features. Key features include:
- AI
- Copilot
- Purview governance
- Viva Connections
This guide provides essential information to help you make informed decisions for your organization.
- TCO comparison
- Security and compliance breakdown
- Migration strategies
- Hybrid architecture
- Decision framework
SharePoint Online vs On-Premises: Quick Comparison
| Dimension | SharePoint Online | SharePoint Server (On-Premises) | |---|---|---| | Infrastructure | Microsoft-managed; no servers to run | Customer-managed servers and patching | | Updates | Continuous; new features monthly | Annual feature packs; you control timing | | AI features | Copilot, SharePoint Premium, Syntex, Viva | Not available | | Compliance (regulated) | FedRAMP, HIPAA, SOC 2, GCC/GCC High | Organization-managed; harder to certify | | TCO (500 users, 5 years) | Lower — no hardware/server licensing | Higher — hardware, SQL, OS, CALs | | Customization | SPFx (modern, supported) | Farm solutions and classic add-ins (retiring) | | Microsoft investment | Primary platform — all features here | Security patches only — no new features |Key facts
- 2026 is a definitive inflection point — Microsoft invests almost exclusively in SharePoint Online.
- SharePoint Server receives security patches but no new feature development as of 2023.
- FedRAMP High and CMMC Level 3 compliance are available in GCC High — not achievable on-premises for most organizations.
- TCO for on-premises is consistently higher over a 5-year period when hardware, SQL, Windows Server, and CAL costs are included.
- 30–40% of organizations have ROT content that should be removed before any migration.
When to Choose SharePoint Online
SharePoint Online is the right choice for almost all organizations in 2026.
- You want Microsoft Copilot, SharePoint Premium, or Viva Connections — all Online-only.
- You need FedRAMP, HIPAA, SOC 2, or GDPR compliance — Purview provides these natively in SharePoint Online.
- You want to eliminate server infrastructure and patching overhead.
- You need the latest SharePoint features on a continuous delivery model.
- You have remote or hybrid workers who need reliable cloud access from any device.
When to Stay On-Premises
Very few organizations have legitimate reasons to remain on-premises in 2026. The exceptions are:
- Highly classified government environments where FedRAMP High certification requirements are not yet met in the cloud (this category is shrinking rapidly).
- Organizations with regulatory mandates that explicitly require on-premises data custody — read the regulation carefully; most do not actually prohibit cloud.
- Legacy custom code dependencies so extensive that remediation cost exceeds the 5-year value of cloud migration (rare; usually only SharePoint 2003–2010 environments).
TCO Comparison: 500 Users, 5 Years
On-premises SharePoint consistently costs more over a 5-year period when all costs are included.
| Cost component | SharePoint Online (E3) | SharePoint Server On-Premises | |---|---|---| | Licensing | $36/user/month (~$2.16M over 5 years) | CAL + server license (~$300K upfront) | | Hardware | $0 | $150K–$300K (servers, storage, network) | | SQL Server | $0 (included in Online) | $50K–$150K | | Windows Server | $0 | $30K–$80K | | IT admin overhead | Reduced — Microsoft manages infrastructure | 1–2 FTE dedicated to SharePoint farm | | Disaster recovery | Included | Separate DR environment cost |Note: E3 licensing cost appears higher but includes Exchange, Teams, OneDrive, and Microsoft 365 apps — not just SharePoint. On-premises requires separate infrastructure for each workload.
Security and Compliance Comparison
SharePoint Online's compliance posture has surpassed on-premises for regulated industries.
SharePoint Online (via Microsoft Purview)
- Sensitivity labels auto-classify based on Copilot grounding hints (2026 feature).
- Container labels enforce sharing controls at the site level automatically.
- Content Explorer surfaces unauthorized PHI/PII exposure in real time.
- Unified Audit Logging with 12-month retention (6 years on E5).
- FedRAMP High and CMMC Level 3 available in GCC High.
SharePoint Server (On-Premises)
- Organization-managed compliance — no built-in equivalent to Purview auto-classification.
- FedRAMP and CMMC certification requires significant additional tooling and documentation.
- Security patching is the customer's responsibility — delayed patching is a primary vulnerability source.
- No native equivalent to Microsoft Sentinel anomaly detection or Defender for Cloud Apps.
Migration Approaches
Large-scale migrations require a structured approach. Follow these six steps for a successful on-premises to Online migration.
- Discovery and assessment — use SMAT to identify migration blockers: unsupported site templates, classic web parts, workflows.
- Content cleanup — remove ROT content before migration. Most organizations have 30–40% redundant, obsolete, or trivial content.
- Architecture design — map on-premises site collections to SharePoint Online sites and Microsoft 365 Groups using the hub-spoke model.
- Pilot migration — validate tools and benchmark throughput on 2–3 representative sites.
- Wave-based migration — execute 5–10 TB per wave with user acceptance testing between waves.
- Cutover and decommissioning — final sync, URL redirects, 30-day parallel run before decommissioning on-premises farm.
Hybrid Architecture Option
Hybrid SharePoint lets organizations run SharePoint Online and SharePoint Server simultaneously during a multi-year transition.
- Hybrid search — unified search results across both on-premises and Online content.
- Hybrid OneDrive — redirect users to OneDrive for Business in the cloud from on-premises.
- Hybrid sites features — surface modern SharePoint Online site features in the on-premises environment.
Hybrid is a bridge — not a destination. EPC Group recommends hybrid only as a transitional configuration, not a permanent state.
Frequently Asked Questions
Is SharePoint Online better than SharePoint Server in 2026?
Yes, this applies to nearly all organizations. Microsoft focuses solely on SharePoint Online. The following features are available only in the Online version:
- AI features
- Purview governance
- Viva Connections
- SharePoint Premium
SharePoint Server does receive security patches, but it will not see new feature investments. The only exceptions are organizations with true on-premises data custody requirements.
What is the TCO comparison between SharePoint Online and on-premises?
Over a 5-year period, on-premises solutions are generally more costly. This includes expenses for hardware, SQL Server, Windows Server, CALs, and IT admin overhead.
In contrast, SharePoint Online (E3 at $36/user/month) offers a bundled solution. It includes:
- Exchange
- Teams
- OneDrive
- Office apps
The on-premises equivalent requires separate infrastructure for each workload.
Can I migrate from SharePoint Server to SharePoint Online without losing data?
Yes. Use a structured migration approach: assessment, content rationalization, architecture design, pilot, wave-based migration, and cutover. Use ShareGate or AvePoint Migrator for permission preservation.
Run post-migration validation across 5 dimensions: content integrity, metadata, permissions, functionality, and compliance. EPC Group has completed 6,500+ SharePoint migrations without data loss.
Do I have to migrate SharePoint workflows when moving to SharePoint Online?
SharePoint 2010 and 2013 workflows are retired and cannot be migrated directly. They must be rebuilt using Power Automate.
Furthermore, InfoPath forms need to be converted to Power Apps.
Plan for 1 to 4 weeks for each workflow rebuild. EPC Group includes a workflow migration assessment in every SharePoint migration engagement.
Get a Migration Decision Assessment
Talk to a SharePoint architect about your on-premises environment, compliance requirements, and migration timeline. Call (888) 381-9725 or request a free migration decision assessment.