Should your company use Exchange Server or Office 365? Recently, Microsoft upgraded Office 365 and released a new version of Exchange Server.

They both offer the latest security features and are fully compliant with all privacy guidelines. So, which do you choose? The question comes down to whether you want onsite or hosted.

Exchange Server: On-Premises

The general trend is toward the cloud, but there are still plenty of companies out there that want a self-contained, onsite system. While you have to house and maintain all your own hardware, you also have more control over your system.

Exchange Server is better for companies that want on-premises control and have the IT resources to handle it. It’s also better for companies that don’t have enough bandwidth for a cloud solution or have large file-sharing needs (e.g., 50GB or more).

Office 365: In the Cloud

With Office 365, there’s no hardware purchase or need for dedicated IT resources to house and maintain a system. The low monthly subscription structure makes it an easy, cost-effective option for many small- to mid-sized businesses (SMBs).

One thing Office 365 has that Exchange Server doesn’t is Clutter: a feature that uses smart technology to learn patterns in emails. If Clutter sees that a user never opens email from a specific sender, it will automatically sort the email into a separate “Clutter” folder or delete it rather than put it in the user’s inbox.

A Couple Things to Keep in Mind

One: Microsoft is placing all its bets on the ever-growing cloud market rather than the on-premises market. (Which partly explains Clutter in Office 365 but not in Exchange Server.)

Two: if you’re running an older version of Exchange, you should get ready to move to Exchange 2016. On April 11, 2017, Microsoft will be terminating all support for any version of Exchange dating to before 2010.

Also, if you’re using a pre-2010 version of Exchange, as an extra step you’ll have to migrate your files to Exchange Server 2010 before migrating them to Exchange Server 2016 (2016 doesn’t integrate with pre-2010 versions).