Is The Future of Data Centers Hyperscale and Colocation?

Whenever we talk about data centers, we talk about the fact that many businesses, even large enterprises, have moved to a cloud version of a data center, allowing someone else to manage their servers, storage, and other network elements. But colocation, born in the cloud DVR era, has started to make a comeback and is in fact, its own type of business. What’s driving this trend, and is it the future of data centers?

Jump to Section:

• What is Colocation?
• The Cost of the Cloud
• The Value of Space
• Some Benefits of Colocation

What is Colocation?

Colocation is essentially where instead of installing servers in a certain area or a certain room in your business location, you rent space for your servers and equipment in an established data center owned by a third party. This space can consist of a small area, a room, or even a cage of sorts. Since the data center already has the power and cooling capacity needed to house servers, a business doesn’t need to invest in building and equipping a new space of their own.

Colocation started as a way for two companies, Comcast and Charter Communications worked with yet another company to set up a data center that could provide users of online “cloud DVR” services with the speed they needed to “re-stream” content they had recorded.

Today, colocation companies are really real estate brokers of sorts: they sell or rent space that meets a company’s specific needs. Space is located within a large (sometimes very large) data center where “tenants” share the cost for power, cooling, and maintenance.

But why the surge in popularity now and is the future of data centers?

The Cost of the Cloud

When data reaches a certain speed and volume needs, a cloud data center can sometimes be more expensive than a physical network. Businesses, as they grow, often discover this, and move at least part of their cloud computing back onto colocated servers where they own and maintain their own servers.

Another reason involves data sovereignty requirements: certain data cannot cross country or other boundaries, limiting the type and location of cloud data operations a company can use. The need for additional physical protection of data also feeds this trend.

Edge computing, the option of deploying IT assets in multiple, smaller, more geographically diverse locations, is changing the conversation around data centers. Digital assets are widely distributed between the cloud and colocation and the objectives of this type of distribution is constantly changing depending on company needs.

The Value of Space

One key here is space. Often a smaller business might only need a single rack of space: others might have greater needs. Ensuring that any rented space is used to the best advantage is key: the less space used, the lower the cost. After all, data center relocation companies are often simply real estate and property brokers, and many don’t understand exactly what their customers are trying to accomplish and what needs they might have.

But to “sell” their services effectively, they need to learn the language of computing rather than real estate. Square footage and “a killer window vies” must be replaced with terms like workload, performance, speed, and reliability. It’s important that they can share with customers how colocation in a large data center can meet their computing needs.

However, in another way, it’s important that the business understand things like an efficient use of rack space such as using Zero U cable routing systems, power allocation, proper cabling and labeling, and the physical protection the data center offers their network.

Some Benefits of Colocation

There are several benefits of colocation vs. building your own data center in your own business space.

• Reliability – An established data center and shared computing with other businesses means your uptime is assured, and you have greater peace of mind when it comes to reliability.
• Security and compliance – There are a variety of standards regarding physical and digital data security, and a colocated data center already meets those requirements. These concerns are more difficult to deal with when you have an on-site data center.
• Cost of ownership – all the concerns related to data center security and reliability come with costs: those costs can quickly escalate. Colocation keeps those costs steady.
• Scalability – Should you grow and need to scale your own data center, that could be quite costly. The potential space you have available in a colocated space makes scaling much simpler.
• Interconnection – Being located with other businesses means you can do business together and share resources.
• Hybrid cloud options – many colocation data centers also include cloud servers, meaning a hybrid cloud approach can be easier to adopt.

Of course, as with any data center solution, there can be some drawbacks. However, there are only a few, and most are related to cloud vs. colocation issues, including cost factors. These often come into play when a company is at a “tipping point” in growth, where they are on the verge of needing colocation, but cloud solutions are still working for them.

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