Copyright (c) 123RF Stock Photos
Copyright (c) 123RF Stock Photos

Many companies need their IT infrastructure to be available 24 hours a day and 365 days a year. Between employees spread in multiple time zones and customers who access data outside of business hours, the concept of a nine-to-five peak time is obsolete. With this in mind, a company has two choices in developing an always-on infrastructure:

  1. Build a data center that has adequate physical security, redundant bandwidth, and multiple power sources to ensure up-time.
  2. Rent colocation space in a third-party data center.

Unfortunately, some companies are choosing a third option: to host their IT infrastructure in an inadequate data center. This exposes them to the risk of data loss, down time, and lost market opportunities.


Colocation is the practice of renting space in a data center provided by a third party. Third-party colocation centers are typically purpose-built facilities that meet high standards. A colocation center will usually be very physically secure while offering ample bandwidth and power supplies backed up by generators. The companies that build these facilities are usually experts in the field and have the resources to both design and manage the center to a standard that most businesses are not equipped to equal.

Colocation’s Benefits

  • Up-time. Many colocation centers offer generators, battery backups, and, in carrier-neutral centers, multiple network connections. The center could lose power and lose a major network connection, and it wouldn’t go down
  • Efficiency. Shared spaces can use larger and more efficient cooling equipment while also amortizing the cost of power saving technologies over more users and more servers.
  • Flexibility. Colocation allows companies to easily shrink or grow their infrastructure by giving up space or renting additional space on an as-needed basis.
  • Reduced cost. With colocation, companies are freed from making their own capital expenditures to build and constantly update their data centers.
  • Support. Many colocation providers also provide support services that can help users manage, configure, and upgrade their servers without the user having to go to the site.

Colocation Candidates

The obvious candidate for colocation is a company that needs a highly reliable data center but can’t justify the expense of building it for itself. However, companies that have their own data centers also turn to colocation providers. For them, the redundancy that can come from having systems distributed across multiple company- and third-party-owned centers provides additional security.