Differences between Azure Cloud  Server and Physical Server

Differences between Azure Cloud Server and Physical Server (On Premises)

There are so many reasons and benefits having the Azure Cloud Server.

Having a Physical  Server is a very expensive cost for any company to buy and maintain.

Both the initial upfront and running costs are very costly.


differences between cloud server and physical server

Azure Cloud Server

Physical Server (On Premises)

Total Cost of Ownership

  • Hardware and Software – eliminates the need for physical and virtualized hardware,storage, and software licensing
  • Management and Maintenance – Microsoft provides full management and maintenance of Exchange Online with 24/7 Support
  • Backup – Microsoft provides automatic real-time backup and recovery for alternating datacenters
  • OPEX – Operating  Expediture
You will need to buy hardware and software for

  • Hardware Server
  • OS Server Software
  • Antivirus Software
  • UPS
  • Backup Software
  • SAN/NAS Storage
  • Extended Maintenance Services for 24/7 (for Server)
  • Extended Warranty for Server and other Network Devices
  • Higher Service Level  Agreement (SLA) for Internet Services
  • Redundancy Hardware and Services (for failover)
  • CAPEX – Capital Expenditure

Running Overhead and related Supporting Costs

  • Bundled for Azure Cloud Server
  • Electricity Costs of running Server, Air-Con, UPS, Backup, Switch
  • Maintenance services costs for hardware/software
  • Extended Warranty costs for Hardware
  • Repair costs for Hardware
  • Maintenance cost of servicing air-con for Server Room
  • Rental of Backup generator in case of building electricity servicing (requirement by PUB)
  • Need Internet Services with Static IP
  • Need to pay for redundant Internet Services, in case of primary internet access failure.
  • Rental Cost of Office Space
  • Cost of Server Rack or any furniture.
  • Cost of Cabling/Labeling/Documentation
  • Cost of Replacement Battery for UPS

High availability

  • High availability and redundancy is built in and there is a financially-backed 99.9% SLA for Exchange Online.
  • Need to get 2nd Secondary WAN
  • Limited Warranty of the physical hardware (max 5 years)

Future Proof

  • No need to upgrade anymore.
  • No more downtime for migration to newer version or hardware
  • Need to engage time-consuming and expensive migration exercise every 4-5 years.
  • Migration may cause some downtime.
  • Newer version every 3 years


  • Can scale up and scale down computing power accordingly to changing needs and requirements
  • Can stop and start at anytime
  • Have to buy hardware and project computing usage for the next 5 years
  • Cannot Reduce or downgrade
  • Little Resale Value if operation ceases

Migration Costs

  • Lower Costs
  • Shorter downtime
  • Higher Costs due to manual and physical work
  • More Downtime during migration

Location Independent

  • Faster Location Migration
  • Can be located in anywhere desired according to user location (to minimize network latency)
  • Slow Location Migration
  • Need to pack and unpack if operation relocate.