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Is Colocation Still Worth It? 5 Things to Know When Choosing a Provider

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Why Businesses Still Choose Colocation in 2025

Many companies use public cloud for some workloads but that doesn’t mean colocation is outdated. Colocation hosting still makes sense if you want full control of your hardware, predictable costs, and reliable uptime without building your own data center.

But not every colocation setup is the same. The wrong provider can lead to surprise costs, slow support, and headaches when you grow. So before you sign that contract, here are five things every IT leader should check.

1. Know Your True Total Cost of Ownership

Colocation costs more than just rack space. You’ll pay for:

  • Hardware (servers, switches, storage)

  • Power and cooling

  • Remote hands support when you need help on-site

  • Internet bandwidth (make sure you know what’s included)

Run a five-year total cost of ownership (TCO) plan. If your workloads are steady and high-performance, colocation can save money compared to public cloud. Colocapacity can help you build a custom cost comparison.

2. Location and Network Performance Matter

Your data center’s location affects how fast your apps run. Look for a facility close to:

  • Major internet exchanges (for low latency)

  • Your users or branch offices (for edge workloads)

  • Diverse carriers for redundancy

Ask your provider for route maps and latency reports so you know what to expect.

3. Check Certifications and Compliance

Security and uptime depend on strict standards. Look for:

  • SOC 2 Type II reports

  • ISO 27001 certification

  • PCI-DSS or HIPAA if you handle sensitive data

Always ask for up-to-date audit reports. If your business has special compliance needs, your colocation provider should help you meet them.

4. Plan for Easy Growth

You don’t want to outgrow your rack space in a year. Good questions to ask:

  • Can you add more racks or private cages later?

  • How much extra power is available?

  • Are there cross-connects for multi-cloud or hybrid setups?

Colocapacity can design a flexible plan so you’re ready to expand without moving everything later.

5. Don’t Overlook Support

Colocation means you still own the hardware, so you may need on-site help. Good providers offer 24/7 remote hands. Ask:

  • How fast can they respond if you need a drive swapped at 2 a.m.?

  • What’s their average ticket resolution time?

  • Do they have real on-site staff or just on-call contractors?

Read reviews or ask for references — you want a partner you can count on.

Final Thoughts

Colocation hosting is still a smart option for many businesses that want control, uptime, and predictable costs. But the provider you choose makes all the difference. Take the time to compare your true costs, growth plans, and the support you’ll get.

If you’re wondering if colocation is still the right fit for your company, talk to us!. Our team can help you plan for today and the future.

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