Apologies if this is a daft question but I am trying to understand the upgrade or migration path to the new online Dynamics 365 and any caveats for using it.

Current we have a couple of versions on-premise, CRM 2011 and 2013 but we also have a version online.

This version is ‘CRM 2016 Update’ but what I do not understand is if it will be automatically upgraded to Dynamics 365 or not or are these different bits of software.