Data Center Colocation is Booming 

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451 Research recently released it’s latest report on the state of the data center colocation industry. The main takeaway from the report is that data center colocation will be a $33 billion dollar a year business by 2018.

Who stands to gain from data center colocation and why is the market booming? Let’s take a closer look at each of these topics in order gain clarity on the state of the data center colocation market.

Onsite vs. Colocation vs. Cloud

Now more than ever, organizations are finding that data center colocation gives their business more flexibility in deploying hardware and managing servers.

Onsite data centers have proven to be costly while cloud gives organizations the ability to buy infrastructure on a per minute basis. The happy medium between onsite and cloud is colocated servers in strategic geographic location. Businesses are rapidly moving their workloads into colocated data centers for a variety of reasons.

One big reason that organizations have given colocation a second look is the fact that colocated data centers are carrier neutral, giving your end users amenities such as a faster connection to website applications, a lower ping time to the outside world and lower latency on the apps that your business hosts.

Build Your Own Cloud Using Colocation

openstack-private-cloud | Deluxe company The biggest barrier to entry for public cloud computing is security. After all, if your business is renting someone else’s equipment just as you would with any IaaS provider, how do you know exactly where your data resides?

Colocation gives businesses the ability to deploy their own cloud using customized security policies. Open source cloud platforms such as OpenStack are free to deploy while more proprietary cloud stacks such as Azure stack and Eucalyptus can also be configured.

When your business provides its own hardware, rents space in a colocation facility and sets up its own cloud using a suite such as OpenStack, this setup is referred to as a private cloud. With a private cloud, your organization owns the hardware and pays the colocation leasing fees while end users can spin up servers and request additional storage space on the fly.

Hybrid Cloud is a Motivating Factor for Colocated Data Centers

While many organizations prefer to use their own hardware, IaaS definitely has a place in today’s ever-changing technical landscape. As a result, businesses are increasingly using colocated data centers to host their private cloud infrastructure while simultaneously connecting that infrastructure to public cloud infrastructure.

The end result is a hybrid cloud infrastructure. Hybrid cloud uses both public and private cloud hosting simultaneously. The advantage to hosting your private cloud in a colocation data center is the 100% network availability guarantee and the ability to retain full control over the data center hardware that you deploy.


Jon Biloh
Jon Biloh

As president I'm responsible for developing and executing our global strategy, generating new business opportunities, enhancing the customer experience and ensuring that ColoCrossing provides world class service!