What is colocation hosting?

As the lines between colocation, Cloud and managed services become increasingly blurred, it’s worth taking a moment or two to understand just what colocation hosting is, and isn’t, and the benefits it can provide on the digital transformation journey.

A bit like the tourist who stops to ask for directions and is told: ‘Well, if you want to get to there, I wouldn’t start from here’, let’s start by concentrating on what web hosting isn’t, rather than what it is.

Colocation hosting isn’t the same as managed hosting. For managed hosting, the clue is in the name. You own the hardware appliances and the software which sits on them, but the hosting provider manages everything for you.

Colocation hosting isn’t the same as web hosting. With web hosting, you’ll be using the provider’s servers, not your own.

Colocation hosting isn’t the same as the Cloud. In the Cloud, you own nothing, simply access and manage infrastructure and/or applications as and when required.

Colocation hosting isn’t the same as a managed service. As the name suggests, a managed service is supplied and managed by the provider according to your requirements.

That was easy!

Now you know what colocation hosting isn’t, let’s move on to what it is, and the advantages it has to offer.

In simple terms, colocation hosting provides you with a third-party environment in which to place your IT hardware – most usually servers and storage – removing the need for you to build, own and operate your own computer room or data centre facility.

The major attraction of this approach is financial. The cost of building, owning, operating and maintaining your own data centre is substantial - in terms of the materials, infrastructure and personnel required throughout the facility’s lifecycle. First there’s the building’s construction costs (or, at the very least, the expense of preparing a suitable computer room), then there’s the power and cooling, racks and cabinets, cabling, fire suppression and physical security to be paid for and installed, and then there’s the ongoing cost of employing security and facility professionals to run the data centre.

Contrast this with colocation hosting. You can install your IT hardware in an environment where the power and cooling, racks and cabinets, cabling, fire suppression and physical security have already been provisioned by the colo provider. As an added bonus, the colo provider’s data centre will have multiple connectivity partners, giving you access to a huge choice of local, regional and global networking infrastructure. Imagine the cost of providing such infrastructure access to your own data centre facility.

Of course, you won’t be the only company using the colocation hosting facility, but that’s why this approach is so financially attractive. You are benefitting from a massive economy of scale, whereby the cost of building, owning, operating and maintaining the data centre is spread across multiple customers.

For example, let’s say that the cost of installing data centre power and cooling is x. If you build your own facility, you’ll have to pay the whole cost of x. If a colocation hosting company has, say, as few as 20 customers, then the cost to you to access the power and cooling is just a twentieth of x – a massive saving. And this saving applies to every aspect of the capital and ongoing operating costs. In our basic example, you’ll have access to a data centre, for as long as you want, for just a twentieth of the cost if you own and operate your own facility.

And the savings don’t stop there. Imagine your single company approaches a power provider to obtain the best possible price for the amount of power you think you’ll need. Then think about a colocation hosting company approaching the same provider to supply power for the 20 customers of our earlier example. Who is likely to obtain the better price?

And then there are the benefits of flexibility and scalability. Build your own data centre or computer room, and how big do you build it? Large enough for the current workload; maybe large enough to allow for some expansion; maybe twice as big as you need it, just in case?! Okay, so it’s a bit of a guessing game, but chances are you’ll be paying for space you don’t need right now or might never need.

Using a colocation provider, you can make sure that you only pay for what you use and, what’s more you’ll be able to scale up, pretty much immediately, as and when required – whether that’s for permanent expansion, or for a one-off, or seasonal, capacity increase.

And we haven’t even mentioned the potential benefits of peer-to-peer connectivity. More and more colocation hosting companies are creating industry-focused communities within their facilities. The idea being that companies can carry out many of their communication activities without having to leave the data centre – providing a much faster, more reliable infrastructure environment when compared to sending and receiving information across multiple data centres scattered around the world.

In summary, colocation hosting provides a value for money environment in which to place your IT hardware assets, offers a high level of physical security, high availability and stability, cuts both your CAPEX and OPEX costs and boosts quality of service,

When one considers that more and more of the Cloud and managed services providers, who live and breathe IT and who require the utmost reliability and resilience when it comes to data centre infrastructure, are themselves using colocation hosting companies as part of their plans, then it’s not immediately obvious why an end user would not take the same route.

The only thing you have then to decide, is which colocation hosting company to choose? Not all colocation hosting companies are created equal, but that’s maybe a topic for another blog!

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