Ernest Sampera

By: Ernest Sampera on June 3rd, 2019

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How to Understand Your Colocation Pricing


Making the decision to colocate servers with a third-party data center is only the first step in a longer process of finding the right partner. When a company starts to evaluate colocation facilities, price is often a key consideration. But colocation pricing can be rather complicated. Standard features in one facility might be considered “add-on” services at another, creating the illusion that one provider is much more expensive than the other. When making colocation pricing comparisons, it’s important to understand what goes into the quoted costs.

How to Understand Your Colocation Pricing

Rack Space and Power Requirements

Perhaps the most straightforward factor in colocation pricing is paying for rack space in a server cabinet. The pricing structure is typically based on either the total number of racks used or the amount of square footage colocated assets take up. Not all rack space is created equal, of course. Some servers must be placed in high-density racks with higher power requirements and additional power distribution options. A typical colocation pricing quote will begin with how many cabinets are needed, as well as what type of power circuits will be required to power the equipment in question. Colocation facilities also charge additional power costs to reflect the amount of cooling resources used. These costs are typically spread across all colocation customers, but cabinet deployment and server performance could have an impact on pricing.

Connectivity Options

Once rack space and power requirements are resolved, the next major colocation cost factor is connectivity options. Some facilities may factor a basic high-speed internet connection into their pricing, but additional, more specialized connections are often available for customers who need them. Cross connections allow colocation customers to connect their servers directly to cloud provider servers to improve network performance and security. In many cases, external direct connections (such as Azure ExpressRoute) can be provisioned for even greater speed and versatility. A carrier-neutral data center also offers a rich array of ISP connections, allowing companies to select the provider that best suits their needs while building redundancy into their networks. With DDoS mitigation services (such as vX\defend), they can also use this connectivity to better protect their networks from unexpected downtime. Building a customized hybrid or multi-cloud architecture could further increase colocation costs.

Bandwidth Needs

Measured in megabits-per-second (mbps), bandwidth is another important variable in colocation pricing. Selecting the right bandwidth amount can be challenging for an organization, especially if it’s expecting to experience growth in the near future (which is often what brings them to colocation hosting in the first place). Bandwidth is a measure of how much data can be transmitted from one point to another over a certain amount of time. A 100mbps connection, for example, is capable of delivering 100 megabits of data to or from colocated servers every second. Higher bandwidth naturally translates to faster network speed because data isn’t bottlenecking when it travels to the servers. Fortunately, most data centers can adjust bandwidth requirements quickly and incorporate the changes into the billing cycle.

On-Site Support

Colocation data center providers are far more than a warehouse service. They offer a wide range of support options, from deployment assistance and routine maintenance to specialized solution building and troubleshooting services. At a minimum, technicians will be on hand during business hours to monitor the facility and ensure that systems are working properly. On the other end of the spectrum are comprehensive remote hands services, which provide 24x7x365 support that functions as an extension of a customer’s IT team. While some customers may consider cutting their colocation costs in this area, they should keep in mind that remote hands services are able to respond to problems quickly and efficiently, which is especially important when a server crashes in the middle of the night.

DCIM Software

Visibility is everything when it comes to maintaining network infrastructure. Monitoring key metrics can help companies identify trends that can improve network performance and adjust their strategies to better accommodate user demands. Colocation data center providers deploy sophisticated data center infrastructure management (DCIM) platforms to evaluate their infrastructure. Increasingly, they’re making these tools available to customers through software portals that provide access to critical metrics and offer tremendous visibility into their colocated assets. Programs like vXchnge’s award-winning in\site platform may be seen as a luxury by some, but their ability to drive down costs associated with inefficient deployments, wasted power, and unused bandwidth makes them well worth the expense. Whether a facility offers these software tools as part of their base colocation pricing or as an added feature, customers can greatly benefit from the control they provide over their colocation assets and network environments. Without them, they might as well be locking their servers in an empty closet.

Colocation pricing incorporates a number of different costs, but the core elements are often the same across most organizations. By determining their exact needs, companies can get the best pricing options from colocation hosting. They should remember that colocation is a classic case of “getting what you pay for.” When it comes to network infrastructure, it’s very often worth paying whatever it takes to get the highest levels of control, visibility, and support from a colocation data center provider.

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About Ernest Sampera

Ernie Sampera is the Chief Marketing Officer at vXchnge. Ernie is responsible for product marketing, external & corporate communications and business development.

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