What Is Colocation Data Center?

Known for offering security, continuity, and scalability for your applications, systems, and data, colocation data centers have been around for quite some time. Colocation is done in a third-party facility. The leased building offers placement of enterprise-owned computing and is a great way to ensure the safe storage of your data.

In addition, a data center takes away a company’s need to build and regulate server rooms for data centers. Moreover, it gives clients the liberty and freedom to prioritize other aspects of their business.

The Use of Colocation Data Center Facility

The equipment from different companies is co-located and housed in the same facility. The business owners own the hardware, and the colocation data center staff manages the data.

These centers come in handy for companies with a large geographical footprint. Such companies can place their equipment in multiple colocation centers and ensure their hardware is close to the nearest facility. Here are some other things you need to know about.

  1. Since it is a shared facility and one center usually houses equipment from multiple companies, the cost of cooling, communication, and power is shared. This makes it cheaper than buying a separate data center.
  2. It is similar to keeping the servers in-house. You will still have autonomy over your equipment.
  3. It allows you to use your limited space for other important things rather than allocating the entire space to your data.
  4. It also allows for greater bandwidth. Since data centers have to manage a lot of data, they use greater bandwidth than companies use in their offices.
  5. A data center is more secure and reliable. Multiple data backups keep your data protected from firewalls and viruses.
  6. A Colocation data center also offers greater CCTV monitoring, fire detection, suppression systems, and mantraps, thus offering greater physical security.

Services Offered By A Data Center Colocation Facility

Depending upon the colocation data centers, they can provide various services. Here are some things you need to know.

  • Colocation centers will provide building, power, cooling, and bandwidth. They also provide physical security to the clients.
  • The clients provide servers and storage to a data center.
  • The clients lease the space at the facility. This could be a rack, a cage, or a full cabinet.
  • A data center also provides comprehensive services that cover business initiatives.

Types of Colocation Facilities

There are two main types of colocation data centers: wholesale and retail. A hybrid cloud-based type has recently entered the market, but it is not very common. Here is what you need to know about the types.

Wholesale Colocation Data Centers

A wholesale colocation data center is available at relatively lower prices. A tenant will usually lease you a fully built and functional data center space for your business. The only issue with wholesale centers is that they offer less power and space than retail vendors.

Retail Colocation Data Centers

As a business owner, you will lease space within a fully built colocation center. It could be a rack, a cabinet, or a fully caged area. This is great for relatively smaller businesses.

Hybrid Cloud Colocation Data Centers

It is a mix of in-house and outsourced types of data centers.

What Are Colocation Facility Tier Standards?

There are four different tier standards associated with a colocation facility. Here is all you need to know.

Tier 1

In Tier one of the data centers, there are non-redundant capacity components. Moreover, it involves a non-redundant and single distribution path that serves your IT hardware.

Tier 2

This is similar to Tier 1 of the data center and meets all those requirements. However, it also contains redundant capacity components.

Tier 3

Tier 3 meets all the requirements of Tier 1 and Tier 2 of the data center. The major difference is that multiple distribution paths serve your IT hardware. However, there is usually only one independent distribution path that will serve equipment at any given time.

Tier 3 is special because it ensures that all IT equipment enjoys dual power. The equipment is also fully compatible with the internet topology available in the colocation facility.

Tier 4

The best of all tiers are available at the colocation data center. Tier 4 meets all requirements of 1, 2, and 3. You get a colocation facility that is fault-tolerant through distribution, storage, and electrical networks. In addition, the cooling equipment is top-notch and dual-powered. The HVAC systems are also of the best quality.

What Are The Benefits of A Colocation Data Center?

Businesses all over the world are switching to colocation facilities. Here is why you need to do the same. These are some of the many benefits of relocating to a colocation data center.


Unless you have a lot of equipment to store, it is always better to use a data center for your business. It is cheaper and does not require you to spend a lot on maintenance and storage.

Few Technical Staff

The cost of labor has gone up in recent times. For managing your data, you will have to hire extra experts who can provide better firewalls and exceptional security. A data center helps relieve you of the pressure.

Extraordinary Reliability

A data center offers excellent physical security, multiple reliable connections through fences, backup power generators, and more. You rarely have to take care of the day-to-day operations.

Favorable Geographical Location

Having a data center near you can help you feel protected and secure. Most companies have data centers in various locations; you can choose one near your business.

Greater Predictability

With a data center handling your storage, you don’t have to worry about unpredictable costs. You can sign contracts with the companies and pay them the same amount monthly or yearly.

Ease of Expansion

Easy scalability and expandability are two additional reasons you should invest in a data center. When your business expands, you can easily add new equipment or servers to the colocation facility.

Why Are Colocation Data Centers So Secure?

One of the biggest reasons people are relocating to a reliable data center is that it is exceptionally secure. Colocation providers will exceed limits to ensure you get the most secure return on your data.

Some even erect fences so that they can isolate the tenant’s hardware. This allows a locking gate for each fence, thus allowing tenants to access their data without interrupting the data of others.

In addition, tenants have to go through a variety of checkpoints in order to access their data. Contrary to what people think, this does not take up much time and is not inconvenient. Some even restrict their tenants from accessing the physical colocation data center. They can only access the data remotely.

How Does A Colocation Data Center Charge Their Client?

Depending upon the colocation data center, each one charges its client differently. Most facilities will charge their clients per rack space. Others, however, charge tenants for cabinet spaces or entire floors—some charge according to a square foot of space. You can also own a data center entirely. A couple of things determine the overall cost you will be paying to a data center.

  1. Amount of space
  2. Power consumption
  3. Support contract
  4. Network connectivity
  5. Geographic location
  6. Technical support
  7. Tier system

Colocation Data Center Vs. Public Cloud

People consider costs, security, and reliability when comparing a data center to a cloud provider. But there is more to the story.

  • A colocation data center provides physical assets compared to a public cloud that provides virtual ones.
  • Cloud service providers will manage your network elements, servers, and storage. The cloud’s staff will manage these things, and your staff will be relieved of the extra burden.
  • Cloud providers also find ways to reduce the overall expenditure costs of the operating systems.
  • The data center must set up its unique servers, network elements, and storage facility. This adds to the extra cost for the ten.
  • Colocation requires businesses to set up their servers, storage, and network elements. The downside of this is the additional costs involved in making a move.
  • People who prefer cloud services do so because it offers more flexibility. Cloud providers also make it easier to downsize one’s data requirements.
  • With the cloud, it is much more difficult to expand a business. You need more data storage, which is not always possible with a cloud.

The Bottom Line

Whether you want to expand your business or relocate your data to a more secure location, a colocation data center is your way. It is reliable, efficient, and less expensive than cloud services. In addition, a data center helps relieve the burden on your staff and thus helps your company expand better.

Derik Belair

As President and CEO, Derik leads the vision, strategy and growth of Augmentt. Prior to founding Augmentt, Derik was the Vice President at SolarWinds, leading the digital marketing strategy for SolarWinds’ Cloud division. Derik has been working in the channel for over 20 years, starting his career as a channel sales rep at Corel Corp. and eventually becoming the first employee at N-able Technologies in April of 2000.
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