The Benefits of Moving to a Colocation Data Center

Posted by Annie Eissler on October 8, 2018

One of the price tags of digital transformation is the pressure of scaling up your data center. When considering your options — retrofitting, expanding or collocating — the first question to ask is: what are your priorities?

Do you want to focus on your core business while scaling IT infrastructure cost-efficiently? Then it makes sense to shed some of the IT functions that are peripheral to your business, and move the burden of facilities to a data center that was designed with a variety of scenarios in mind.

A colocation center is a turnkey solution for rapidly scaling your IT needs and shaving weeks or months off your deployment. BCC Research estimates the global colocation market will expand between 2016 and 2020 at a global compound growth rate of 15.4 percent, to $54.8 billion. Cost may be one reason: BCC Research says colocation helps enterprises save on IT infrastructure, security compliance, and disaster recovery.

Let’s look at some of the advantages of moving to a colocation center.

Redundancy and Reliability

A poll of 800-plus organizations surveyed by ITIC found that 81 percent require a minimum of 99.99 percent availability. And the costs of downtime have been increasing, with 98 percent of large enterprises reporting that just one hour of downtime per year costs them more than $100,000. For 81 percent, those hourly costs exceed $300,000.

Data centers are built to withstand failures, with redundant environments for power, heating and cooling, communications, and other systems. They invest significantly to ensure uninterrupted power for guaranteed uptime, whereas in-house you’re likely only covering the bare-minimum requirements.

Disaster Resiliency

The redundancy of power is especially important given the disaster-prone U.S. geography. Just about every geographic area has some sort of natural calamity that can cripple your business in no time.

Power outages are not the only type of emergency that affects your data. Is your facility prepared to withstand a flood — especially if your data center is in the basement, as it often happens — or a fire? Colocation facilities are designed for both scenarios, offering raised floors as well as sophisticated fire suppression.

Cost Savings

Computer Economics estimated an increase in IT outsourcing last year to 11.9 percent from 10.6 percent in 2016 — the highest growth in five years. It named data center operations as one of the functions with the most outsourcing potential. Why? Because providers can offer economies of scale.

You can reduce your TCO through both capital and operational expenses. Some examples include:

  • Eliminating the need to provide your own, costly N+1 power supply and backup
  • Lowering power bills, especially if you have a computing-intensive environment
  • Keeping low staff overhead by shifting the burden of 24/7 staffing and monitoring to the provider
  • Reducing overall facility and equipment maintenance costs


A data center that is certified with specific compliance credentials gives you the peace of mind that you are complying with your industry’s standards and requirements for data security. Additionally, since many regulations require annual audits, you can inherit the audits of your data center. Just make sure an independent party conducts them.

When you use a compliant data center, you’re not just simplifying your own compliance. You’re also saving tens of thousands of dollars on auditing costs.


Some data centers only have access to a few network carriers, but others may provide as many as several dozen options. The ability to choose from various global carriers has several advantages, including costs and broader service options.

In addition to the vendor-neutral benefits, a top data center will have redundant network connections, ensuring your mission-critical applications run uninterrupted.


Data centers typically offer superior security to what you may be able to provide in-house. This includes both network security — with the latest technology and protocols in place — and physical security with 24/7/365 onsite personnel and other measures.


Dust and humidity may not be the first thing on your mind when you’re running your data center, but they do impact the performance of electronic equipment. No matter how clean you keep your building, it’s not likely to match the low-humidity, dust-free, consistently cool environment that data centers are built for.

If low-latency I/O performance is important to you — and it typically is — you can also improve quality by choosing a local colo center. Which brings us to the final point: location.

Why Location Matters

While outsourcing your data center may be a smart business move, make sure you’re choosing the right location. Besides latency issues, location also impacts:

Physical access — if you want easy access to your racks and facility visits, consider a data center in your area, or at least a location close to a major transportation hub.

Connectivity — look for solid infrastructure like dark fiber, to make sure you’ll get fast and reliable connectivity.

Price — being in a major tech corridor sounds great, but you’ll be paying for it accordingly; you may be surprised that a less popular location just a few miles away can save you quite a bit of money.

There’s no one-size-fits all solution when it comes to your data center. Whatever option you’re considering, make sure it gives you the flexibility to accommodate not just your current needs but also future business growth.