What is Colocation?
Large information technology (IT) companies such as Google, Amazon or Microsoft have their own data centers. Mid sized and smaller companies however may not be able to afford or may not need a whole data center for their infrastructure. For these companies colocation is a better option. Colocation is basically a shared data center. Multiple different companies (and individuals) rent out space in a large data center.
Colocation makes sense when a company needs IT infrastructure, but does not need a full data center. Data Centers are usually huge warehouse-like buildings which house servers. A server is just a powerful computer. Data centers provide air conditioning, high speed Internet connections, security, redundant power supplies and other features. Most IT infrastructure needs all of this. While a huge company like Google has the money to build their own data center, most companies are unable to make that kind of investment.
Most mid range and smaller companies need a few servers to run things like email, databases, websites, etc. It would simply be a waste of money to have their own data center when they can collocate somewhere instead.
On the other hand, even small companies should consider collocating rather than keeping their servers in their office. A collocation facility is going to keep the data safe and secure. This is especially true of companies which store delicate information on their servers, such as payroll, or customer information. What would happen if there was a burglary or fire in the office and that data disappeared? A collocation center will have stronger measures to prevent disasters from occurring than an office building.
Benefits of Colocation
Colocation has a number of benefits. As already mentioned, cost is one. It is far cheaper to lease a single cabinet in a colocation facility than to build a data center. The main benefit is the uptime provided to a company's IT infrastructure. Colocating computer hardware helps keeps the IT infrastructure up and running at all times.
Uptime means that the employees of the company never have to stop working because their email is down, or they cannot reach the Internet or their payroll database. These kinds of It problems can bring productivity to zero. Ensure proper IT uptime eliminates these loss of productivity.
Anyone familiar with computer security will tell you, if you have physical access to a computer you pretty much have unlimited access to that computer. In other words if someone is able to physically get to that computer they can easily steal, change or delete the data on that computer. Colocation facilities make physical access by unauthorized users all but impossible.
Along with security against individuals a good colocation facility will have security against natural disasters. Fires, floods, storms, etc. should not be something a colocation customer should be concerned with. A properly managed server in a colocation facility should experience minimum down time.
The idea of minimum down time includes power and Internet outages. A benefit of colocation is the redundant power and the redundant Internet connections which colocation centers have. A power outage should not affect power to the data center. A colocation facility will also have multiple Internet networks which connect to it, allowing customers to have redundant Internet connections.
Colocation works because multiple customers lease cabinet space inside a single data center. This allows them to share the costs of benefits they would otherwise be unable to afford on their own. This sharing of costs allows for the same high level infrastructure as IT giants, with minimal costs.
Who Should Think About Colocaton?
If you have computer hardware that needs to be secure and up at all times, investing in colocation may be a wise idea. If you experience lack of productivity because your IT equipment is having trouble on a regular basis, you may want to move things over to a colocation facility. If you have your servers in a janitor's closet somewhere, you should seriously think about moving it over to a colocation facility.
If your servers/routers are hiding in a closet or worse:
you probably need colocation.