Why You Should and Shouldn't Use Colo

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What if you could somehow pass on your server room responsibilities to someone else? How would it feel to get access to the network power, performance, and staff of a huge enterprise? If you replied, “That would be awesome,” to either of the above questions, colocation may be the right choice for you. Let’s first explore what this IT approach is and an overview of the current market before looking at key elements within the industry (to better understand what is impacting providers), and a list of reasons companies take this route.


  • Understanding Colocation
  • Changing Elements of the Colocation Industry
  • Top Reasons for Choosing Colocation
  • How to Approach Colocation Smartly
  • Moving Forward


Understanding Colocation


Colocation is leasing space in an outside data center for your servers and storage – with the owner of the facility meeting your needs for a secure physical location and internet connection. Unlike with cloud hosting, all of the hardware in a colo relationship is owned by you. This arrangement is attractive to many companies because of basic economies of scale: you can access a highly skilled staff, improve your bandwidth, bolster your data safety, and access more sophisticated infrastructure. Your bill is basically a combination of rack space and some degree of maintenance (often minimal).


Changing Elements of the Colocation Industry


Colocation providers are entering a trickier landscape as the market gets hotter. Buyer personas are proliferating; sustainability is becoming a greater concern; cloud hosting is on the rise; and computing strategies are becoming increasingly diversified and complex. Just how hot is colocation getting? With a 14.4% CAGR between 2011 and 2016, the industry is a bit steamy. (But don’t worry: enterprise-grade, multiple redundant cooling systems ensure that your hardware will never sizzle.)


Put another way, colocation may not be as trendy a concept as cloud, but the former is more widely used by enterprises than the latter. According to Uptime Institute’s 2017 Data Center Industry Survey, 22% of enterprise IT systems are housed in colocation centers, while 13% are cloud-based. Plus, cloud is growing in line with cloud: according to figures highlighted in Virtualization Review, that 35% external data center total is expected to rise to 50% by 2020.


Related: “How to Use Colocation to Your Advantage”


As the market continues to develop, colocation vendors must have the agility to reshape themselves in response while also looking for ways to build their own business by incorporating breakthrough equipment and strategies, and by continuing to focus on operations, affordability, and performance.


Here is a look at some of the key aspects of the market that are evolving, keeping life interesting for those who work at colocation providers:


Who buys location? In the past, people in facilities or procurement roles would typically be the ones engaging with colocation vendors. Now, though, choices on infrastructure are being handled by a broader group that includes line-of-business and C-level management. Since colocation firms are now interacting with more COOs, CFOs, and heads of business units, it is increasingly important that they are prepared, both from sales and business perspectives, to “talk shop” meaningfully with individuals from a multifarious array of backgrounds.


How is DCIM used? Both internally and as a value-added service, data center infrastructure management (DCIM) software is becoming a more central function in colocation facilities. DCIM bolsters service assurance while leading to better consistency across analytics. It allows companies to convert their data into actionable metrics and gives infrastructure executives insight into speed and reliability throughout the scope of systems, for more accurate, knowledge-driven decisions. These gains lead to a less expensive, more highly available, and more efficient ecosystem.


How is the data center designed? The way that a data center is laid out must make way for cloud hosting, edge computing, and other growing methods. Because methods are in rapid flux, adaptability must be built into architecture. Flexibility makes it possible to pivot to meet different applications and needs. On the flip-side, what colocation centers do not want is minimal service options or stranded capacity. Addressing these issues requires a sustained focus on density and the support of mixed-density rows. Right-sizing can be achieved through modular design so that colocation firms do not overprovision from the outset. These vendors must think about the extent of resiliency that they want to implement and how far to go in that direction – keeping in mind that high resiliency, like high density, is expensive. Additionally, safety must be considered as an element of design, especially since higher density, in and of itself, poses a greater risk to staff.


Top Reasons for Choosing Colocation


The primary reason companies feel hesitant to choose colocation is a sense that they will lose control. Anyone who chooses this route knows they are handing their servers over to someone else.


Well, so then why do people do it? For one thing, yes, you lose day-to-day control of your servers in a physical sense, but you do retain much more control over them than in many hosting scenarios (most notably cloud, since that option is often juxtaposed with colocation). It is still your equipment and your software.


Beyond that, reasons vary. Small and midsize businesses can use it to affordably access a more sophisticated computing environment than they have onsite.


Another key, organization-nonspecific reason that colocation is used comes from Michael Kassner of TechRepublic: “[M]ost managers said their colocated equipment was mission critical, and the colocation providers were able to meet their requirements at a lower cost than if the service was kept in-house.” Sounds simple enough.


Here are a few additional ideas from Susan Adams of Spiceworks on the advantages of entrusting your servers to a colocation facility:


  • Improved physical security (think access logs, cage locks, and cameras)
  • Helpful support (well, if you’ve chosen the right provider)
  • Better uptime, since you’re getting access to cutting-edge uninterruptible power supply (UPS)
  • Better cooling so that your hardware gets better care
  • Scalability, since all you have to do is send the data center more machines
  • Connections with various major ISPs through dedicated fiber.


Colocation is often more cost-effective than using your own datacenter since the amount you get billed is inclusive of HVAC costs and power. “Even without those cost savings, though,” says Adams, “you’re paying for the life-improving peace of mind of an enterprise-quality, stable, and fast data center.”


How to Approach Colocation Smartly


How can you succeed with this infrastructural method? First, be prepared by understanding that you need to start with your own software and servers.


Once you have all your machines ready, Adams advises to start monitoring resource consumption so that you successfully stay within any resource limits related to your plan.


Also, switching from your own datacenter to colo involves various moving parts. Build in extra time, and be prepared for potential snags so that everything proceeds forward smoothly.


Finally, in order to facilitate usability, you want to have a strong connection to the colocation facility – as can be achieved with a Border Gateway Protocol (BGP) circuit and BGP tail.


Moving Forward


Are you considering colocation for your infrastructure? At Total Server Solutions, all of our datacenters are robust, reliable, and ready to meet your challenges. Discover our reach.