Advantage of Colocation Services

Businesses are often faced with make or buy decisions. Do you create a product or service in-house or go outside to a vendor who specializes in that field? The same question arises related to telephone and computer services. So, what’s the right answer?

Like most everything, technical services decisions are very specific to your particular situation at any given time. That’s why you should revisit these issues on a regular basis - say yearly. You know what the advantages are to buying and managing your telephone and computer systems in-house. What are the advantages to going outside?

I’m going to focus on a very specific set of services you can buy, called colocation. Colocation is not quite the same as going to the “cloud,” but there are some similarities. What colocation really means is moving your telephone and/or computing resources into another facility called a colocation center or carrier hotel.

As you might suspect, there are various degrees of colocation involvement. The one that generally comes to mind is packing up your data center equipment and shipping it to a colocation facility. Within this facility, you or the facility staff re-install your equipment in a locked caged area that is not accessible to other customers of the colocation center.

What’s the point of that? It’s an economy of scale in several areas. You’ll only save on real estate if you are pressed for space now or are paying a premium per square foot in a high rent building. But it’s not just the physical footprint that’s important. The “colo” center provides equipment racks, electrical power, cooling air and physical security. They have all the power you can possibly use and the HVAC equipment to carry away the heat from high performance servers and switches. They also have backup systems in place so that you don’t need to worry about power outages. That can be important if you are located in an area subject to storm outages or questionable power lines.

Many companies move to colocation centers simply for access to unlimited amounts of cheap bandwidth. Cheap is relative, but bandwidth costs per Mbps at colocation centers are probably better than you can get at your facility. There are multiple carriers located in the same building who establish points of presence for their fiber optic networks. Construction costs are minimal, if anything, because it’s just a matter of getting a drop from a carrier’s cage to yours. If you are in a location where you are bandwidth limited, with no fiber options or sky-high construction costs, simply relocating to a colocation center can solve the problem. You still communicate with your remote facilities using T1 lines or other available bandwidth.

In addition to facilities, colocation centers are staffed around the clock. This is a real boon to smaller companies that can’t afford a 24/7 tech staff. Even larger companies may benefit from having server experts literally a few feet away from their equipment at all times. You can maintain your own equipment, of course, or hire the center personnel to perform upgrades and patches.

You also have the option to rent equipment rather than supply your own at many colocation centers. Why come up with the capital expense for new servers every few years (or few months) when you can rent fully managed servers dedicated for your use only? This approach can also make sense for telephone equipment. Why have an expensive PBX phone system on your premises and the staff to keep it running, when you can use a remote PBX that an expert provider buys and maintains?

These questions are the heart of make-buy decisions. More and more, companies are finding it makes more sense to rent from a large facilities provider than maintain equivalent systems in-house. How about your business? Could you do better at a colo center? Find out by getting colocation services prices and availability that you can compare with your own costs to make an informed decision.