What is the difference between SAP on-premise vs. SAP Cloud?

SAP On-Premise is a traditional, on-premise SAP software system that is managed and hosted by the customer on their own hardware and internal network. It is a self-contained system that is maintained by the customer’s IT department and requires the customer to purchase hardware, software, and personnel to manage the system. All configuration is maintained by the customer.

SAP Cloud is a cloud-based system that is hosted and maintained by SAP. It is a subscription-based system that requires the customer to pay a monthly fee for access to the system and its services. It comes in 2 different version: Public vs. Private Cloud. With the SAP Private Cloud the customer is in charge of some of the configuration while with the SAP Public Cloud SAP maintains the configuration settings. In general, SAP Cloud is easier to set up and maintain than an on-premise system, as the hardware, software, and personnel needed to maintain the system are provided by SAP.