Colocation pricing trends

Why Colocation

Data Centers are growing very fast. The Reason is all information is managed in these only and these are now business critical. It is very vital to keep the cost of IT related expenses for organization. All companies need to have dedicated data centers as it might not have proper Return on investment. Colocation is solution to such companies and businesses. Building your own datacenter need lots of efforts, Time and money. In Colocation, Service provider provides you facility and some bundled services at affordable price.

Colocation provides some and more of following services to you to have datacenter established.

  1. Space: It can be measured as Rack space or Square fts.
  2. Cooling: Cooling remains one of basic necessity along with space.
  3. Power: Electric power along with appropriate Power backup is also part of bundle service.
  4. Physical Security: Only authorized people will have access to colocation area.
  5. Facility related Services like fire safety, battery room, cleaning, sanitation etc are part of real estate and offered along with colocation.
  6. Internet Links and other Communication services are charged separately and optional.
  7. Managed Services like managing your servers and other infrastructure pieces are also offered.

Colocation cost varies from $1000 to $2600 per cabinet/Rack. It also depends on all factors we considered.

This list is very specific to Service provider or Colocation service and most of times these services are customized for customers so that it suits best to customer requirement.

As the trend for colocation is increasing day by day, these services are becoming more affordable and have better return on investment. Factors mentioned above influence the cost for colocation services. There are few more factors which affects the costing offered by services provider:

Geographical Location of Colocation Data center:

Location of datacenter influences the real estate value of datacenter hence impacts rental value for colocation. Also how suitable is facility for the Disaster Recovery is considered factors.

How much do you need?:

More space you need provider will give better pricing. It is same as retail vs wholesales services.

Diversity Provided by Colocation provide for Communication links:

Are the internet, WAN and other telecom related links have robust and redundant paths. To provide this kind of facility, service providers have common area for Telecom service providers. This enables customer to select from multiple options.

Term or duration for which customer is looking for Colocation services.

Contract time duration also affects cost offered by Colocation service provider. Longer you stay more economical services are.

Scope for future growth and expansion

Colocation Service provider also enables you to expand or modify your space as and when needed. This keeps you out from worries of capacity planning for future.

Most of times colocation is one of the best options for housing your business critical systems. With time Colocation service are getting more effective and affordable. It helps to keep your IT budget low compared to having your own data center. Colocation Service provider also provides better professional services for facility, Security, Cooling, Power, Power backup etc. Also have scope for future growth as needed.

With time colocation is becoming more and more competitive and cost effective. The Future is Colocation for small and medium sized businesses.


Data Center Talk updates its resources everyday. Visit us to know of the latest technology and standards from the data center world.

Please leave your views and comments on DCT Forum.

KEYWORDS: Data Center, Datacenter, Colocation , Electrical system, data center power design, Datacenter power monitoring.