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What is Colocation and Why It Makes Sense for Your Business

By: Ernest Sampera on July 29, 2019

For many companies, IT infrastructure has long presented a stumbling block in terms of business growth. The cost of building out a data solution was often far too high, forcing them to put off scaling their capacity until they had the resources to afford it. Unfortunately, that often translated into missed opportunities and flattened revenue.

Colocation services are changing all of that. More and more companies are partnering with colocation data center providers to build a more dynamic IT infrastructure that can accommodate rapid growth.

What is Colocation Hosting?

Growing companies often find themselves in a difficult situation when they need to scale the capacity of their IT infrastructure, but lack the capital resources necessary to build out the data solution that meets their needs. The up-front investment costs of building a private data center are quite high, to say nothing of the ongoing maintenance expenses associated with managing power and cooling requirements. There’s also the problem of connectivity. A data center without extensive interconnection options is little more than a warehouse with servers. As the sole tenant of a private data center, companies will find themselves paying top dollar for access to the internet and cloud service providers they need to run their business.

Colocation hosting solves this problem by taking over the burden of building and maintaining data center infrastructure and operations. Customers instead rent rack space to house their servers in a third-party data center and pay for the power and cooling resources they use on an ongoing basis. Since there are multiple tenants in a facility, colocation costs are more evenly distributed among them. Many colocation definitions characterize the arrangement as converting capital expenses into operating expenses because customers only pay for the colocation services they actually use and don’t have to pay the substantial costs of building the infrastructure.

Colocation Data Center Providers

The typical colocation data center is designed to be far more efficient than most on-premises data solutions. Private data centers are often not purpose-built to take into account the best practices for modern data center design, which makes them quite inefficient in terms of energy usage. Colocation data center providers, on the other hand, can implement a number of practices to run their facilities more efficiently, which allows them to pass cost savings along to their customers.

A data center-as-a-service (DCaaS) model allows colocation customers to build out a customized suite of services for their IT infrastructure. Rather than simple colocation hosting, DCaaS empowers companies to take full advantage of everything an enterprise-level data center has to offer as if it were their own private facility. Thanks to intelligent monitoring tools like vXchnge’s award-winning in\site platform, they also retain full control over their own assets and data.

Colocation Services

Today’s organizations need a data solution that’s more scalable than traditional private networks and offers more security and control than public cloud platforms. With their extensive interconnectivity options, colocation data center providers can build a variety of innovative hybrid cloud and multi-cloud architecture that combine the best of private and public computing networks. As carrier-neutral facilities, colocation data centers offer competitive pricing for those connections as well. For customers looking for low-latency, high-performance connections, they can upgrade services to single cross-connects or even direct external connections through services like Microsoft Azure ExpressRoute.

Colocation data centers can also help their tenants get closer to their customers thanks to edge computing architecture. Overcoming latency is a major challenge for many companies trying to deliver services over the internet, but by colocating with edge data centers positioned closer to end-users, they can overcome the problems associated with last-mile connections and enhance their Internet of Things (IoT) functionality.

Redundancy is an important part of any data center strategy. In the event of a disaster, companies can’t risk losing access to their valuable data and applications. Colocation data center providers specializing in disaster mitigation services can protect these companies by backing up mission-critical assets in safe locations to ensure business continuity.

Data Migration Process

While colocating offers tremendous advantages, companies are often hesitant to embrace colocation hosting because they find the data migration process intimidating. Moving essential hardware and data into a colocation environment is certainly a big undertaking, but it doesn’t have to be a difficult one if IT personnel put together a thorough migration plan and checklist that accounts for potential risks. Since most of today’s colocation hosting arrangements involve deploying a hybrid or multi-cloud, it’s important to think about where data will actually be stored during and after migration.

Essential legacy systems always need special attention during a data center migration, but many software assets can be easily relocated to a cloud environment using lift-and-shift strategies. Even if they can’t be moved so easily, they can often be rearchitected to take advantage of the features available in a new cloud-based environment.

Colocation services provide organizations with a number of advantages that allow them to compete with companies that possess far greater resources in terms of IT infrastructure. Efficient data center practices help to keep colocation costs down and the broad range of connectivity options available makes it possible for companies to deliver better products and services to their customers. No longer tied down to high capital expenses, colocation customers can easily add capacity to their infrastructure by expanding their deployments and connecting to additional cloud-based resources. And with the transparency and control of intelligent monitoring tools, they can be sure that they’re getting the most out of their infrastructure at all times.

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