The difference between On-Premise Versus Cloud - Azzure IT
Azzure IT

The difference between On-Premise Versus Cloud


We are here to help you understand the differences between Business Central On-Premise versus Cloud, so that you can make the right choice for your business.

Firstly, we need to explain one key point – On-Premise doesn’t just mean On-Premise and having it installed at your site. This version also covers Private Hosted which means you have your own Cloud Hosted Virtual Server.

D365 Business Central Cloud

Dynamics 365 Business Central Cloud is a Public Cloud solution – this means that the core software exists as one central version on the Public Cloud that is shared by multiple organisations. Every user in every company uses the same single version of the core software and that single version, in the Public Cloud, is updated with enhancements and fixes on a continuous basis (often referred to as a Multi-Tenant architecture).

In a B2B context where customers want a standard packaged solution with automatic updates, this is a great solution as you don’t need to worry about upgrades and update – they are automatically applied.

However, those that require adaption or configuration to ensure a ‘custom fit’ with company specific procedures, processes, descriptions, reports etc, need the software to be configured to meet their exact needs. In these cases the customisations/configurations may be limited with the cloud solution as we need to protect other users from anything that could put excess load on the shared platform or open it up to vulnerabilities. You may also not want updates applied automatically in case if affects your customisations or the way that you work.

Dynamics 365 Business Central Cloud provides open APIs. To ensure that customers are able to customise (develop code), you are provided with customisation capabilities using Visual Studio Extensions. This allows you to customise your system ‘outside the core code set’ using predefined events and therefore applies some functional limitations to protect the core system used by all customers.

D365 Business Central On-Premise Versus Cloud
(also Private Cloud / Hosted)

Dynamics 365 Business Central On-Premise, on the other hand, is installed and run in a unique environment for each customer (even where hosted/private cloud is selected). This is a single tenant architecture and enables the full breadth of functionality, customisation and configuration to be used. For our customers using NAV, this means that you can use the full breadth of business functionality and technical capability/functionality to ensure fit with your processes and integration with other systems.

For those who opt for Private Hosted, we provide this on the same secure Microsoft Azure platform this is used by the Public Cloud version. The difference is that Private Cloud is fully managed for you by the team here at Azzure. With Private Cloud we allow you to choose when you want to installed updates and new versions, we have access to fix any issues you may encounter, and we can provide any levels of customisation or integration you require. This is the same service as the one we are already providing our NAV customers. 

How does this affect my business?

Firstly, we have a Dynamics 365 Business Central solution that fits the needs of your business regardless of the model you prefer – On-Premise, Private Cloud / Hosted & Public Cloud.

Azzure IT have been providing on-premise and cloud hosted Dynamics solutions since 2011 when the first versions of Dynamics NAV could run in the Cloud. Since that time, we have a wealth of experience with both Public and Private Cloud hosted solutions.

Cloud Platforms (Private and Public) generally offer simpler scaleability and, often, stronger security as well as reduced administration costs.

We will work with you to establish which platform is the best for your business.


With D365 Business Central, licensing has moved to Named Users – the same as for Office365. This means each Named User that has been setup to use the system needs a license. Prior to this, Dynamics NAV used Concurrent User licensing which meant that it counted the number of users logged into the system at any one time.

  • Up to and including NAV 2018 – Concurrent User
  • Business Central Cloud – Named User only
  • Business Central On-Premise (Also Private Cloud / Hosted) – Named User only

Licensing pricing

As for Dynamics NAV, d365 Business Central offers both Subscription and Perpetual pricing. Subsciption offers a single, low cost per user per month. Perpetual requires a capital investment upfront with a lower ongoing annual fee. Perpetual licenses, however, are only available with the On-Premise version:

  • Business Central Cloud – Subscription only
  • Business Central On-Premise (Also Private Cloud / Hosted) – Subscription or Perpetual (One-Off Capital cost)

Other Licensing considerations

Business Central Cloud Subscription allows you to use either Business Central Cloud or Business Central On-Premise
Business Central Cloud Subscription allows you to create a “Hybrid Cloud” where you have an On-Premise version which synchronises with a Cloud version.
Business Central Cloud Subscription includes the capabilities of the Microsoft Power Suite (Flow, PowerApps, Power BI) along with Artificial Intelligence and Cognitive Services.

This enables you to:

  • Use PowerBI for Dashboard reporting and drill-downs into your data without a separate subscription
  • Use PowerApps to build mobile apps to access your data and create additional data entry screens
  • Use Flow to introduce workflows between Dynamics365 and other applications
  • Use AI and Cognitive Services to advise on future actions based on historical trends and patterns. A couple of practical uses of this are more accurate Cashflow Forecast based upon customers payment trends and Stock Forecasting based upon historical stock usage trends./li>

Business Central On-Premise (also Private Cloud / Hosted) paid for as a Perpetual license does not include the above.

Upgrading & Migrating

If you are on a pre-NAV 2018 version it is still possible to upgrade to NAV 2018. It is equally possible to upgrade to Business Central Cloud or Business Central On-Premise (With or without Azure Private Cloud / Hosting). There are several scenarios and some discounts for making a move to Business Central – each scenario has nuances depending when a customer bought Dynamics NAV, what license you have and when you might want to make a move. Most importantly, however, we need to work with you to assess the service, functional and commercial benefits and costs for your specific situation

Contact us for more information and for your free consultation to discuss the specific benefits we can bring to your business. 

Contact us for more information and for your free consultation to discuss the specific benefits we can bring to your business.

Cloud vs On-Premise

Speak with our experts about your Digital Transformation!


Azzure IT
10 Europa View, Sheffield Business Park, Sheffield, S9 1XH, UK

The UK’s Leading Microsoft Dynamics 365 Business Central Provider

t. 0345 467 9950

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