What is Colocation? [Beginner’s Guide]

What is colocation? Colocation, sometimes referred to as collocation, co-location, and colo, is a type of hosting service in which customers rent or lease physical space for their servers, storage and networking devices, and related information technology (IT) hardware within a third-party data center.

In addition to providing the space, colocation providers are also responsible for delivering what is known in the data center industry as ping, power, and pipe.

Ping represents that the servers and other hardware can be accessed remotely through the use of assigned IP addresses such as IPv4 and IPv6. Power represents electricity and the power circuit delivered to the physical data center space. Pipe represents internet connectivity and bandwidth speeds.

Configuring colocation services

There are different types of configurations for colocation services. Most colocation providers offer their colocation services based on the space, power, and connectivity requirements of the customer.

Remember that colocation is a typically multi-tenant meaning more than one customer within a data center and even at the rack level. By the way, a colocation rack is similar to a locker but for your servers. It is a mesh enclosed container with shelving units or rails for installing servers and related IT hardware.

Colocation space options

Colocation space can be configured for individual servers, also known as per unit (U). It can include quarter racks, half racks, cabinets, private cages, private suites and data center halls. Keep in mind that not all colocation providers offer subdivided rack space such as per U, quarter racks and half racks. Some require a full rack or cabinet minimum of 42-44U.

Colocation power options

In terms of colocation power, colocation providers typically configure power circuits to meet customer electricity requirements. This is measured in watts (W), kilowatts (kW), and sometimes megawatts (MW) for large, wholesale colocation providers. A typical server requires anywhere from 200-500W of continuous power.

Colocation connectivity options

Most colocation providers offer internet connectivity with their colocation service. Think of it as a bundled service. The customer has the option of selecting a full rack of colocation with 2kW of power and a 100 megabit per second (Mbps) internet connection. They may also have the option of selecting a blended internet connection which combines multiple telecom carriers and ISPs or dedicated internet which uses one provider.

Along with internet service, customers are able to ask for blocks of IPv4 and IPv6 addresses. This is used in creating computer networks and subnetting for specific devices and applications.

Responsibilities for the customer?

Customers are responsible for providing their own hardware – servers, storage devices, routers, switches, power supplies, and cabling. They are responsible for installing their hardware in the colocation data center. And in most cases, they are also responsible for maintaining and managing their hardware.

Responsibilities of the colocation provider?

Colocation providers on the other hand are responsible for providing the colocation space, ping, power, and pipe. They are also responsible for providing security and redundant systems for the delivery of data center power, connectivity, and cooling.

Redundant systems ensure data center uptime – the availability of the data center to remain operational despite failure or one or more systems.

Physical security of the data center

Colocation data centers are hardened facilities. This means that they are built to withstand natural disasters and attacks. They are typically constructed with reinforced concrete and have no windows. They are located in unsuspecting areas such as industrial areas or business parks and have no signs or banding that would indicate that the building is a data center.

These facilities are physically monitored and patrolled by onsite data center staff, technicians, and security officers. They are digitally monitored by closed caption TV (CCTV) systems. Customers entering the facility are required to be registered in the system, present government identification, and sometime provide biometric authentication such as the reading of a fingerprint to access data center rooms, suites and halls.

Backup power, UPS and power conditioning

Colocation data centers often include one or more backup power generators and uninterruptable power supply (UPS) systems. They also includes internet and network connectivity options from multiple telecommunications carriers and internet service providers (ISPs). This is often referred to as a carrier-neutral data center.

Cooling system redundancy

Cooling systems are critical to data center environments and hardware. Most colocation data centers of one or more backup cooling systems to ensure temperature and humidity levels are set to optimal levels. Colocation data centers are cooled by many different methods.

Is colocation right for your business?

Who uses colocation services? Colocation is best suited for individuals and companies that want to control their own IT infrastructure by owning and managing their own hardware in an offsite, secure and private data center environment. For many customers, colocation offers the best option for hosting reliability, availability, security, and cost-effectiveness.

It is used by individuals, startups, small and medium-sized businesses. Colocation is also used by large global enterprises, cloud service providers (CSPs), and telecommunications carriers.

Well-known technology companies that use colocation services include Amazon’s AWS, Microsoft, Google, AT&T, Verizon, T-Mobile, Colt, euNetworks, Nokia, eBay, NVIDIA, Tesla, TikTok, Pinterest, and Twitter.

Many other types of companies use colocation, especially those in the financial, legal, energy, and healthcare industries. This includes companies like JP Morgan Chase, Bank of America, Citi, Nationwide, Exxon Mobile, Chevron, Kaiser Permanente, United Healthcare, and Anthem.

But it is not just large business and enterprise customers that use colocation hosting services. As mentioned previously, colocation is used by individuals, startups, and small businesses to host their databases, test and run their applications, and backup their data files. In fact, you can host a single server, gaming server, storage device, router or switch, desktop computer in a colocation data center facility.

Colocation is also used by governments. Federal, state and local government agencies, systems and departments also use colocation hosting services for various purposes including data backup and storage.


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