Sorry that I am not familiar with the Amazon Web Services (AWS). I saw these words when I read this document on AWS. But no sure what exactly they mean. So I put my understanding here. Hope get some correct if I was wrong.

In my understanding. I thought “On-Premises” means the provider provides the whole machine to the customer, It looks like IaaS. The user has the full control on the cloud machine he bought from cloud service provider. Means the user can install anything he wants into the machine he bought.

As to the Colocation my understanding is the provider just provide a machine and every software and hardware installed on which the customer need to run his own software. But the customer doesn't need to full control the machine. It looks like PaaS.

Please help to correct me if there is something wrong with my understanding.

2 Answers 2


From my personal experience, On-premises and Colocation are similar in that the customer owns the equipment that is in question. The difference is where the equipment is located at.

On-premises implies that the equipment is at a location that the company in question owns/rents/leases. It is physical equipment in one of their physical locations.

Colocation implies that the equipment is at a location that the company does not own/rent/lease, but the equipment still belongs to them. In other words, the physical equipment belongs to the company, but the location is with a different company.

For example: Think of your computer at home. That computer is on your premises, and it belongs to you, so it's considered on-premises. Now, if you buy another computer, and take it to a friends house, (one you can trust), then it would be at a colocation.

As for AWS, Azure, and similar other services, the customer does not own the equipment and it does not own/rent/lease the location that the equipment is located in. They are not On-Premises services or Colocation services. The "Cloud" is just a term used to describe that the customer won't actually own the servers, but they will be able to use it as per their agreement with the provider.

To add to the example above, basically your friend has a really powerful computer, but they don't use all of the power. Your friend then lets you use some of the power for a fee. You don't own the equipment, and you don't own/rent/lease the location that the equipment is located at, but you're still able to use the server.

On-Premises = My computer / My house. Colocation = My computer / Someone else's house. Cloud = Someone else's computer / Someone else's house.

  • You answer makes me confused . In the AWS or Azure cloud. I thought there is no On-premises product. Because all the machines are in the cloud. they all belong to the Amazon or MS. the customer just rents it . right? Thanks.
    – Joe.wang
    Jun 24, 2016 at 4:32
  • I updated my answer and added information about the cloud.
    – Blerg
    Jun 24, 2016 at 4:51

On-premises hardware or software is installed and runs on the premises of the person or organization using the service

Colocation is software or hardware is installed and runs outside the premises of the person or organization using the service.

  • Could you please give me a solid example of both of them. It would be nice if there has. Thanks.
    – Joe.wang
    Jun 24, 2016 at 4:26
  • I'd add to this answer by saying that AWS provides virtual machines, so that you do not have to purchase hardware.
    – davidgo
    Jun 24, 2016 at 8:40

You must log in to answer this question.

Not the answer you're looking for? Browse other questions tagged .