Colocation vs Cloud Hosting: Integrating the Cloud into your Business

The benefits of the cloud are clear: these technologies help companies scale, increase productivity, and provide better service to customers. With many new businesses entering the cloud market daily, businesses can have a range of options at their disposal. They can implement cloud solutions in full, or in part. As the hosting market continues to evolve, questions arise as to which option, Cloud hosting or Colocation, is a better deal. Aging infrastructure is forcing many companies to get out from under their on-premises data centers and opt for more efficient (and affordable) cloud-based infrastructure.

So, how do you determine which is best for you? It depends on what your organization’s needs are. Colocation and cloud offer some comparable benefits, but each is best suited to satisfy different scenarios.

What’s colocation?

With colocation, companies own, use, and maintain their own equipment, but share the cost of power, cooling, communications, and data center floor space with other tenants. Colocation makes sense if your company needs complete control over the equipment. This is especially true if your organization needs to satisfy compliance or regulatory statutes dictated by your industry.

Colocation is a great choice when a company is running out of space in its existing data center. An industry survey found that 36 percent of data center facilities will soon run out of space, power, or cooling capacity.

“Colocation requires you to purchase your own servers, storage, switches, and software. Second, your IT staff’s time will still be taken up by monitoring and managing the equipment and conducting backups and maintenance. However, many providers also offer managed services that can be leveraged to monitor and manage your infrastructure. Look for a provider that offers a la carte options so you can choose what functions you want a third party to manage and which you want to maintain control over.” – Forbes

What are cloud services?

There are some distinct differences with a cloud-based infrastructure service. Similar to colocation, cloud-based infrastructure offer cost savings through the use of a shared facility. With cloud services, the cloud provider manages hardware infrastructure, such as: servers, storage and network elements. This reduces CAPEX and OPEX, as the provider is responsible for daily administration, maintenance, troubleshooting, and problem resolution.

Nevertheless, if your organization is subject to compliance ordinances, such as HIPAA, PCI DSS, or Sarbanes-Oxley, you will need to select a provider that is able to demonstrate a high level of compliance, certifications, security and has transparent financials. Regardless of an SLA, the burden of compliance still lies with your company.

So, which do I choose?

Colocation and cloud services offer alternatives to traditional in-house data center approaches.

“…you will want to weigh your compliance and privacy needs, your need for direct control, as well as your need for always-on availability and uptime when deciding between colocation and cloud” – Forbes