The navigation device works self-sufficient. The navigation software and maps are saved on the device. It can perform the route calculation itself. Everything you need for your onboard navigation (device, software, maps),you only have to purchase once. You can use it indefinitely, there will be no further charges.
The navigation is offered as a service. Communication between the navigation device and the server of the service provider takes place via a mobile radio connection (GPRS/UMTS)
The maps are located on the server and are always up to date. The software on the navigation device handles communication with the server and the navigation along the routes which the server calculates.
For the offboard navigation, you need a mobile device and a gps receiver (possibly integrated). Often the software will be free of charge. For the navigation service, there are different billing models, e.g. billing according to individual routes or subscriptions, which allow the unlimited use of the service for a certain period of time.
There are also costs for using the mobile network.