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What is Colocation?

Last updated: 13 Apr 2023

As technology has migrated to the cloud and to as-a-service solutions, the IT landscape has become increasingly complex. Colocation vendors are rising in visibility across nearly all industries due to the possibilities this type of arrangement can present. As a company leader, choosing to colocate infrastructure services has pros and cons. A full assessment of both sides of the coin is essential in making the best decision for security, scalability, and future needs.

How Colocating Works

Colocation is an effective way to use advanced hardware and services without the immense technology investment traditionally required to do so. Providers of this service license space and hardware to an organization for a fee and handle all of the maintenance and expansion that may be required. For a vendor specializing in this service, there is a growing list of responsibilities. Data center efficiency, cost, equipment stability, security, scaling, and evolution are important topics of conversation.

Other considerations that are important to colo vendors are architecture design and infrastructure management. Without optimized arrangements and careful configuration, resources may be wasted, vulnerable, or inefficient. Future scaling must be done deliberately and with utmost security in mind. Failing to lock down new hardware is an oversight that can be disastrous. One measure that helps identify a colo vendor with thoughtful processes is to ask about annual SOC, PCI, HiTrust or other industry certification audits the vendor may have obtained.

Industry Know-How

Early colocation offerings were mostly limited to just a few industries. Today is a different story as both small and large companies and interesting new categories of businesses are finding it to be a viable solution. Vendors may find themselves in a situation where they must learn more about the trials and tribulations of this new market and familiarize themselves with typical operations. The types of stakeholders involved will vary substantially, so providers must be versed in speaking to higher levels of leadership as well as technical contacts.

To a buyer, this means that the procurement process must be thorough. Work with the vendor closely to ensure that industry-specific needs and certifications can be satisfied before signing a contract.

Changing over Time

Colocation vendors have an urgent need to stay informed. This is not only related to new technology tools but also to new market opportunities. As business evolves and consumers define new trends, the provider can ideally exploit the opportunity and offer fitting solutions.

From a buyer’s perspective this means that the list of providers is constantly changing. Prices will fluctuate as competitors enter different markets, so it’s important to have a technology partner looking out for the company’s bottom line. As big data grows and more IoT devices enter the scene, colo vendors are generally well equipped to help the company adapt quickly.

Target Market

As with any company in business today, colocation providers often have a demographic that they specifically target. Some are well equipped to handle large technology and telecommunication providers and even have resell agreements with them. Others may specialize in niche businesses. Often they have partnerships with cloud companies and SaaS vendors to provide a wide variety of services on one invoice.

Colocation has become a powerful, flexible IT tool. As with any option, there will be both risks and advantages to its use. Education and conversation will help decision makers choose the best solution for their company. To learn more about the pros and cons of colocating and selecting a qualified vendor, contact BlackPoint IT Services today.

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