We refer to this model as the traditional approach, which regardless of how much momentum working in the cloud has, is still the most popular model. In this model, the customer must buy everything; hardware, software, etc. While the upfront cost is high, not to mention that it can also be risky, in the long run for medium and large companies it is the most economical model.
After a company has purchased everything needed for the software application in question, the solution typically will be deployed behind the company firewall. It would be almost impossible to pursue the on-premise model without having IT lead the entire deployment.