Colocation: A More Practical Solution than Data Centers

What is the difference between colocations and data centers? Colocation or “colo” is a trending service that is often confused with data centers. Technically, colocation works like a data center outsourcing service provider, wherein the clients rent physical space on a data center facility for their companies’ servers and storage hardware. In colocation, the clients provide their own servers and storage hardware while the colo provides the building, security, computing facilities (bandwidth and computing hardware) and utilities (power supply and air conditioning). In data centers, on the other hand, the owner companies provide the building and amendments that will house their servers. They provide all the facilities (servers, storage hardware, bandwidth and computing hardware), utilities (power supply and air-conditioning), and manpower (management, security and technicians). In other words, data centers are facilities that manage the servers of their owner companies and colocations provide data center-like services to renting companies who do not own data centers. What are the features of colocation? There are two basic colocation models: Wholesale and Retail In wholesale colocation, an entire room or floor is leased and the services are customized according to the clients’ needs and preferences. This is the best model chosen by companies who need larger spaces and larger power requirements to operate their servers and hardware equipment there is no need for building a server room. In retail colocation, space is leased by the cage, cabinet, or rack. This is the best model chosen by companies who don’t need a lot of space and power to operate their appliances and hardware equipment. It is important to note that colocations don’t usually provide the manpower for server and data management and technicians—the clients will have to provide them. However, there are colocations (usually the big ones) that now provide server and data management and hardware technicians in addition to the physical housing and protection of the client servers. These services are often referred to as wholesale+ and retail+. Why is colocation preferred by more companies? Simply, the answer is affordability. Colocation eliminates the need for companies to spend on building and maintaining their own data center facilities, which require large capital expenditures (CAPEX). Other reasons may include the following practical reasons: • The client company’s server and equipment are too small for them to build a data center for it. • The client company does not require complex server and data management. • The client company can avail of customized service contracts that will not cost them a lot of money. • The clients can flexibly choose to self-manage their servers and data by providing hand-picked manpower, or hire in-house/colocation-based manpower. • Colos can provide a secure, temporary place for housing servers of companies who are still in the process of building their own data centers but already need the space and facilities to operate their businesses (like cloud service providers). The key to make colocation work for your company’s business is to make sure you choose the right location and service provider. The coli’s location and proximity may be important if your company chooses to self-manage your servers. And more importantly, you must ensure that your chosen colo’s service model fits your company’s needs technically and economically.