The Key Business Benefits of Colocation Hosting

Due to the many benefits of colocation hosting, more organisations are opting for this IT solution. In fact, Market Research Future‘s recent study predicts a 14.4% growth in the data centre colocation market by 2030.

Keep reading to discover: 

  • What is colocation hosting?
  • 10 colocation benefits for your business
  • What to look for in a colocation provider[a]


What is colocation hosting?

Colocation hosting is a service that enables businesses to rent space (usually cabinets) within a secure third-party data centre facility. The space is used to store privately-owned servers and networking equipment.

You can store other computing equipment and hardware depending on the colocation service or data centre. Aside from cabinet space, colocation (or “colo”) typically includes bandwidth, power, security, cooling, and a public IP address.


Colocation hosting examples

Let’s dive into some colocation hosting examples to understand how the service works and why companies might opt to host their computing equipment in a data centre rather than on their premises.


Offsetting an unreliable national power grid

Many businesses opt for colocation in locations where the national power grid is unreliable. In South Africa, for example, enterprises can experience power loss for 10 to 12 hours a day due to the instability of the national power grid.

These power outages significantly reduce productivity and stop critical business operations. Colocation provides a reliable power source and mitigates the expense of running an on-premise generator to account for outages.


Startups and remote businesses

Opting for a colo service requires less upfront capital than building and operating an on-premise facility to run your servers and store IT equipment. Through colocation, smaller businesses can access the capabilities of a large-scale IT department without the price tag.

Meanwhile, businesses operating under a remote (without a premise) or agile model can use a colocation centre as an off-site facility to safely store critical IT equipment without interrupting operations.


Accounting for disaster recovery

Disaster recovery is a critical element of business continuity. In the United States, it’s common for organisations to host their IT equipment and infrastructure across multiple data centres as part of their continuity strategy.

Doing so ensures critical business functions are uninterrupted in the case of a disaster. And using a third-party colo service is far more cost-effective than building multiple facilities from scratch.



10 benefits of colocation for your business

The benefits of colocation are plentiful, from business continuity to scalable infrastructure, network and physical security, and more. Here are some advantages colocation offers companies across multiple industries and sizes.


1. Long-term financial savings

Using a data centre colocation service to store servers and IT equipment means you don’t have to pay the capital expenditures (CAPEX) associated with building and maintaining a specialist facility of your own.

Although the initial outlay of purchasing servers and other computing equipment can be an expense, a third-party colocation solution will work out cheaper for the long haul. This is because you avoid the long-term running costs of hosting servers, which can become more expensive over time than using a third-party data centre.

Plus, as your business grows, colocation allows you to expand your data storage capacity as needed without upgrading an on-premise space or leasing an entire facility.

2. Network security

A third-party data centre facility will have premium network security. That means you can access the latest firewalls and IDS systems to locate and stop anyone from gaining unauthorised access to your systems.

Access to premium network security is key to preventing cyber threats like distributed denial of service (DDoS) attacks, data breaches, and other issues that could undermine your cybersecurity.

It will also provide your team with the infrastructure to access data safely without compromising network security.

3. Physical security

Aside from network security protections, colocation data centres provide top-notch onsite physical security. Most facilities will offer security guards, 24x7x365 monitoring, CCTV, heavy-duty locking, perimeter fencing, biometric access controls, and fire detection and suppression systems.

That means the data centre will protect your private data, servers and other IT equipment from harm within a highly secure facility and specialised staff.

Colocation data centres must comply with mandatory regulations and standards while staying ahead of emerging risks. So your data and equipment are safe and in line with government or industry-enforced regulations, and you’re future-proofed against emerging threats.

4. Redundant power supply

A colocation facility offers redundant critical systems, including a redundant power supply. The facility achieves power redundancy through multiple power grids, battery backup systems, generators, mechanical equipment and top-notch maintenance.

That means a single piece of IT equipment (your server, for example) has access to two or more power supplies to ensure uninterrupted operations and service resilience.

5. Multiple network connections

You’ll gain access to redundant network connections through colocation so your business-critical applications will run uninterrupted, even during national power outages.

A third-party colo facility achieves this by offering a diverse range of connectivity feeds so you can customise a network strategy to offset a connection interruption or overload. The range of internet service providers also ensures the best connectivity and speed capabilities.

6. Business continuity

Premium network and physical security, alongside better connectivity, redundant power supplies, and network connections, provide the kind of reliability and standard of performance that ensures business continuity.

Further still, adopting a colocation computing model means you’ll benefit from fire suppression, temperature control, and air filtration systems that keep your equipment running smoothly.

Redundant cooling systems will also maintain the right temperature to keep your IT components functioning. Your IT equipment will be held in a dust-free, temperature-controlled environment for optimal performance.

7. Third-party maintenance

A key benefit of colocation is that you can outsource maintenance and facilities management to dedicated teams and specialists within the data centre.

A data centre’s facilities management service could include air conditioning, cable management, fire suppression, security, and power management specialists. And specialist systems designed to ensure continuous service.

Meanwhile, you and your in-house systems engineers retain the autonomy to visit and maintain your servers and networking equipment to meet core business IT objectives rather than spending time on facilities management.

8. A step towards cloud adoption

Having a plan in place can make cloud adoption easier so you can access the benefits of cloud computing. Cloud migration can reduce IT costs and improve collaboration efficiency—making it an attractive option for many organizations.

A colocation service provides you with a stepping stone towards cloud computing. And that means you can transition in phases to reduce error margins or stay with a hybrid model.

Either way, hosting some of your IT equipment in a secure third-party colocation data center (often with better connectivity and performance than an on-premise option) will give you an insight into whether a complete cloud migration is right for your business.

9. Bursting capability

A colocation hosting service will allow you to increase your bandwidth to account for increased network traffic—without having to spend heavily on capital investments. Bandwidth costs will remain affordable as the data centre spreads data spikes across time and multiple users.

10. Room for future growth

Alongside bursting capability for an agile response to network demand, colocation provides scalable infrastructure so you can grow your business without the stress of investing in new resources or building space.

You’ll also benefit from reliable third-party power and cooling capabilities that can quickly scale to meet new business demands as you grow—a feat that can be challenging and expensive to achieve internally.



What to look for in a colocation service provider

If you decide that colocation suits your business model, you’ll want to choose the best service. Here’s what to look for in a colocation provider.



In most cases, every customer’s colocation requirements will differ. When looking for a colocation provider, make sure they have bespoke ICT options to suit your individual needs.

Network Platforms: flexibility in action

A common occurrence we see from our customers is that they require a position of the rack rather than a full rack. So, at Network Platforms, you only commit to the rack space required. We offer half rack (20u of rack space) and shared per u rack options—which is helpful if you only have to co-locate a few devices (a server, switch, and router, for example).

We also offer colocation with or without bandwidth. Even if you don’t need dedicated internet access and would prefer to connect with other providers or customers through the data centre, we can offer a solution.

Modular add-on services

Aside from security, fire suppression, and temperature control that come as standard when co-locating in a data centre, you might need additional services beyond housing your equipment safely in a third-party facility.

The best colocation service will provide modular add-ons. These add-ons complement your colo service, reduce cost and give you peace of mind knowing external specialists can manage the required additions.

Network Platforms: modular add-on services in action

As part of our modular add-ons, we allow customers to select two internet service providers. You can co-locate in our cabinets, and we’ll provide Direct Internet Access (DIA). But you can also interconnect with another provider within the data centre as a secondary backup DIA.

Other modular add-ons include:

  • Replication or automated backups of your co-located servers to minimise downtime and ensure business continuity.
  • Monitoring solutions so our specialists can address issues quickly and maintain the stability of your business operations.
  • Firewall as a Service (FWaaS) to protect your servers.
  • DDoS protection or an SDWAN solution.
  • In some cases, we offer customer service options from within the data centre.


Some customers prefer to be as hands-off as possible, and others would like to stay in the driver’s seat with their servers. Regardless of your preference, a quality colocation provider will support you as needed while giving you autonomy regarding your rented space and computing equipment.

Network Platforms: autonomy in action

If a customer chooses only to co-locate a server, Network Platforms allows you to manage your Firewall and co-locate that with your server. Alternatively, if you don’t want to purchase or even manage your own Firewall, you can opt for our Firewall as a Service add-on, and we’ll take care of it for you.

Opt for our Remote Hand’s Service if you don’t have in-house specialists. Our specialists can then rack, connect, move cables or reboot equipment without you having to visit the data centre. But we also offer you the option to access and maintain your equipment.

For complete autonomy, we offer 24-hour unsupervised access to the data centre for clients who commit to a dedicated half rack. Meanwhile, if you opt for shared colocation, we provide book-in-advance data centre visits, and a Network Platforms engineer will accompany you.



The bottom line on the benefits of colocation

Colocation enables business owners to rent space within a secure third-party data centre to store servers and other IT equipment. As part of the service, you’ll typically receive a public IP address, bandwidth, power, security, fire suppression, and temperature control, depending on the provider.

Colocation benefits range from ensuring business continuity, long-term financial savings, scalable infrastructure, and third-party specialist maintenance, to name a few. However, choose a service provider that offers you flexibility, modular add-ons, and autonomy to get the most out of colocation.



Contact us to discover how Network Platforms can transform your connectivity through personalised and reliable colocation hosting.


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