Cloud Colocation: The Next Generation in Data Center Hosting?

Posted on May 24th, 2012


Cloud ColocationMany observers of the data center industry describe colocation as a threat of the cloud. The argument in white papers and public discussions is often guided by the general thought of cloud vs. colocation. In contrast to this dominant view, one can argue that it is much more insightful to look at colocation as an enabler of the cloud rather than an opponent. In fact, colocation might offer the ideal environment that can deliver dedicated infrastructure for the cloud to expand.


Nowadays, data center hosts witness an all time high demand for cost-efficient data center services with enough capacity and power to handle massive amounts of data. Consequently, trends of increasing virtualization to solve this issue of storage space not only emerge but are projected to soon conquer the market. With this rapidly growing demand for data space, handling one’s company’s private cloud possesses a challenge to CIOs. To adopt a realistic view, very few companies can possibly benefit from hosting their own cloud unless they are large corporations.

Colocation might be the solution to this struggle. In sophisticated, dedicated data centers colocation buyers can benefit from professional IT architecture to host their hardware. “Colocation suits companies that need to expand their physical hardware volume without losing their current level of administrative security. It involves a management company running the company’s software securely from anywhere in the world.”*


Due to it’s early origins in the telecommunications sector, colocation technology “allows multiple customers to access network, server and storage gear, and connects them to a variety of telecommunications and network service providers”**. A trusted, professional partner can provide precious digital capacity that runs on shared energy in a multi-tenant environment. Hybrid computing enhanced colocation offers immense scalability in case of rapid growth. On the other hand, if a business does not grow as fast as anticipated, there is no loss due to unnecessary pre-investments on data centre equipment.


Looking at security as one major factor, for instance, professional data centers are specifically built to protect the hardware they host with help of bullet-proof security installations. As already outlined in The Colocation Question In Canada: External Provider vs. In-House, the advantages of buying over building are manifold. The extensive argument, however, is that colocation might be the ideal sky for the cloud. According to a study by Infinity Research Limited, “many vendors are now providing cloud-based infrastructure services along with colocation services.”***


Conclusively, buyers and vendors are advised to no longer regard the cloud and colocation as entirely separate or even competitive services. When it comes to the decision between hiring a professional colocation provider or the do-it-yourself in-house model, considerations of cloud computing should play an important role, too next to other (dis)advantages. In times when cloud computing is the buzzword of an entire industry, it is advisable to settle for a colocation provider that also offers hybrid computing services and is able to integrate both in the most cost-efficient way.




*Cloud computing versus colocation: What’s the right fit? by Caroline Hunter retrieved from


**Colocation: The Logical Home for the Cloud by CyrusOne


*** Global Data Center Colocation Services Market 2010-2014 by Infiniti Research Limited retrieved from