The pros and cons of colocation for businesses
Does colocation make sense for your organisation?

Have you ever considered using colocation services for your business? This is a way of outsourcing your IT. But is handing your organisation’s IT infrastructure over to a third party ISP (internet service provider) sensible? Our Cadolto Datacenter experts are on hand to explain whether using a colocation service is right for you.

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What is colocation?

Organisations use colocation services to house some or all of their servers and other IT hardware in a data centre operated by a third party. This business model allows the customer to make use of the provider’s infrastructure while leasing space in server racks.

Instead of the customer operating their outsourced IT hardware on their own premises, the colocation provider takes responsibility for keeping the systems running. The power supply, cooling, physical security and connectivity generally form part of the service offered.

What is Serverhousing?

The term colocation is often used interchangeably with ‘server housing’. This equivalence is not accurate, however. With colocation services, each customer has its own rack, or at least a clearly separated, locked section of a rack. The server housing business model, on the other hand, means IT hardware for several different customers is accommodated in a single rack with no security features to separate them.

Other products such as ‘managed server hosting’ also differ from colocation. Hosting products are generally not provided on the customer’s own hardware, but on servers that are actually owned and made available by the third party provider. Cloud computing services are frequently delivered on hosted servers.

What are the advantages of colocation?

Small and medium-sized businesses see a significant cost savings benefit from outsourcing their IT systems. They no longer need to operate their own data centre and can take advantage of existing infrastructure.

Reliability of colocation services is also key to what customers want. Providers’ data centres frequently feature redundant power supplies. Reputable providers also offer professional cooling and suitable networking connectivity. They generally have on-site security measures to prevent unauthorised access.

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Colocation for SMEs

Growing SMEs appreciate the flexibility offered by colocation. It allows them to adapt their own IT hardware more easily to their requirements without needing to expand their in-house infrastructure.

Disadvantages of outsourcing IT infrastructure

Colocation looks great at first glance. But as with everything else, outsourcing your IT infrastructure also has disadvantages.
Loss of control
The riskiest issue with colocation is a loss of control. This presents a risk to data security. How do you know who can access your data and hardware? Reputable providers obviously keep track. However, you can never be truly sure about who has access to the hardware or the data stored on it.
Being dependent on a colocation provider also represents a major issue. Customers have no ability to intervene if the provider’s data centre experiences problems or outages.
Depending on the application being housed, the distance between your company offices and the data centre can also become a severe disadvantage. Calculations that have to be carried out quickly, in real time, may be slowed down significantly by lengthy routing paths.
The cost savings benefit is also not always what it seems. At first you will certainly save money. But in the long term it can be more expensive to continue renting racks than to run your own data centre.

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Colocation must be carefully considered

When you compare the pros and cons of colocation, it looks like a good option for small businesses. However, its use by medium-sized operations needs to stand up to scrutiny due to the disadvantages identified. Loss of control and potential vulnerabilities can be particular risks.

 Large organisations would be better advised to stay away completely and run their own data centre instead. And growing medium-sized businesses can find that operating a data centre of their own over a long period is significantly less expensive than colocation.

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Appropriating the benefits of colocation

When businesses have constantly increasing IT infrastructure requirements, the scalability of colocation looks like a major advantage. Scalability can be achieved by other means, however!

For example. the modular construction system of the various Cadolto Datacenter high-tech data centres lets you decide the size of your own data centre. There is no need to erect a super-sized new-build construction – just add a new module to expand your data centre when you need it. Our data centres have all the infrastructure required to guarantee secure and smooth operation of your IT hardware on site, at your premises.

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