An Understanding of Colocation Pricing

A colocation is a great option for businesses needing to rent data center space. There are many factors to consider when shopping for colocating servers. Also, there are various colocation costs that you need to account for. This article will explain what colocation is, how pricing works, and what businesses are most likely to benefit from colocating a server.

What is Colocation?

Colocation hosting (called “colo”) refers to a service where servers are dropped off at a business and shipped to ServerMania, securing the data center and connecting to power and network.

Colocation hosting offers businesses a secure, climate-controlled location, guarded 24×7 by security officers, and staffed 24/7 with technicians to handle any physical server tasks (remote hands). These facilities provide reliable server hosting services with redundant power, networking, and cooling.

Who Uses Colocation?

Customers who colocate typically rent less space in cabinets or cages, but require high network connectivity and cross-connect services. The following definitions apply to colocation customers:

  • SMEs looking to outsource their data center needs
  • Large corporations with massive IT expertise and needs.
  • Cloud service providers and Software-as-Service
  • Content delivery networks
  • Content, internet media, and social platforms
  • Network service providers and telecommunication carriers
  • Government bodies

What is Colocation in a Data Center?

A colocation server center is a physical space that can provide power, cooling, and networking to house servers, storage devices, networking equipment, and other IT infrastructure. A colocation provider will sell this capacity to customers as cabinets, cages, or private suites.

These colocation data centers are available to customers with individual power requirements of less than 1 megawatt (MW) and deployments sizes from 500 to 10,000 sq. feet. Customers can increase or decrease the amount of space, power, and connectivity as their needs change.

Also, Read: What is the Future of Data Centres in the State Of Gujarat?

How do Colocation Data Centers Work?

Colocation data centers make essential distinctions between the roles of provider and customer.


The facility’s day-to-day operations include providing sufficient power, cooling, security, and access to telecommunications carriers.


Customers who use a colocation data center are responsible for operating and maintaining their equipment in private rooms, cabinets, or cages within the data center.

Customers will purchase physical servers and networking equipment such as switches, storage devices, and routers. To put it another way, the colocation data centers don’t rent out servers to customers.

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How Much Does Server Colocation Cost?

Server colocation pricing varies according to the application. It can range from $79/month on a single server to $599/month on a 42U rack.

Prices for colocation vary depending on the units required, where they are located, and the power and bandwidth needed. We recommend getting a quote to find out what your exact needs are.

Why Do Businesses Use Colocation?

Colocation is an attractive IT service for businesses because it helps solve problems or achieve complex results that may not be possible by the company on its own. There are four primary drivers that colocation should be adopted: cost, performance, and compliance.


It is costly to build a fully-featured data center. And it can take years to create a new data center. Businesses must spend tens of millions of dollars to purchase, deploy, and maintain it, not forgetting taxes.


Businesses require a global footprint. But, global presence also means access to international applications and data. One data center cannot support all the global needs of users.


Global businesses also have to comply with increasing government regulations that affect how applications work and how data are managed and secured.


A single traditional data center is a single point-of-failure vulnerability for the company. Floods, fires, earthquakes, storms, and artificial and natural disasters can cause disruptions in connectivity and damaged facilities. This can impact the availability of critical applications.

What are the Obstacles of Shifting to a Colocation Data Center?

While it might seem easy to switch to a colocation provider, the adoption process can be difficult and time-consuming. While the initial investment for colocation is less than for a data center, it is a business decision that should be carefully considered, as colocation agreements can have long-term commitments or constraints.

Response Times

If there is a problem with a local data center, the business takes responsibility for it. The staff, resources and tools are meant for the business’s needs. A company that owns the data center manages the availability and response time.


While colocation providers will be happy to rent more space or resources, there are usually limitations to what they can offer. There is often a delay of weeks or even months before the contract can be modified. There may be a limit to how many changes can be made in a short time.


Modern businesses must be able to see what’s happening in the data center. Transparency is key to ensuring the availability and health of client workloads, provider compliance to SLAs, and client security and regulatory compliance.

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