If you’ve ever asked, “How much does colocation cost?” you know the answer is: “It depends.”
Unlike cloud pricing, where you pay for what you spin up, colocation hosting involves more factors like space, power, bandwidth, and support. The good news? The right colocation plan can save you money compared to building your own data center or running certain steady workloads in the cloud.
But you need to understand where the costs come from and where the surprises can hide.
Big names like Equinix, Iron Mountain, and TierPoint all offer flexible colocation models but the basics are similar:
Space: Usually sold by the rack unit (U), cabinet, cage, or private suite.
Power: Billed per kilowatt (kW) or kilowatt-hour (kWh). Higher-density deployments cost more because they need more cooling.
Bandwidth: Some include a set amount; others bill per Mbps or GB.
Remote Hands: Charges for on-site staff to reboot, replace hardware, or run cables.
Cross-Connects: Connecting your gear to carriers, clouds, or partners can be an extra fee.
Setup Fees: One-time charges to move in and connect your servers.
A 2024 report from Equinix showed that power and connectivity are two of the biggest cost drivers for modern deployments especially with high-density AI workloads.
Colocation pricing varies widely depending on your space, power, bandwidth, and location. Here’s a ballpark look at common ranges from well-known providers:
| Provider | Estimated Monthly Cost* | What’s Included |
|---|---|---|
| Equinix | $500–$2,000 per rack unit | Space, power up to certain kW, basic support |
| TierPoint | $1,000–$3,000 per cabinet | Space, power, bandwidth package, 24/7 support |
| Iron Mountain | $1,200–$4,000 per cabinet | Space, high security, compliance certifications |
| Cyxtera | $800–$2,500 per cabinet | Space, power, blended bandwidth, smart hands |
| Digital Realty | $900–$3,000 per cabinet | Space, power, carrier-neutral connectivity |
| QTS Data Centers | $1,000–$3,500 per cabinet | Space, power, direct cloud on-ramps, support |
*These ranges are general estimates and can vary greatly by city, power density (kW per cabinet), contract term, and additional services.
For example:
Equinix publishes starting pricing ranges in customer case studies and their investor reports (Equinix Investor Relations).
Industry sources like Datacenters.com, Data Center Frontier, and 451 Research frequently publish market rate trends.
Always ask your provider for a custom quote with full power usage, remote hands rates, and cross-connect fees so you can compare apples to apples.
Top providers are upfront, but here’s where costs can sneak up:
1. Remote Hands Fees:
Emergency support or frequent hardware swaps can add up fast.
2. Power Overages:
Going over your contracted kW may mean premium charges.
3. Bandwidth Spikes:
Heavy usage or DDoS attacks can drive up data transfer costs if you’re not careful.
4. Cross-Connect Fees:
Some providers charge monthly for each connection to carriers or cloud on-ramps.
Always ask for a detailed quote with all fees, so there are no surprises.
Even big providers like Equinix, TierPoint, and Iron Mountain share these cost-saving tips:
Right-Size Your Space: Don’t rent more racks than you really need.
Use Energy-Efficient Hardware: Better servers = less power draw = lower bills.
Plan for Growth: Ask about volume discounts or phased expansion to lock in better rates.
Consolidate Bandwidth: Use blended bandwidth solutions to avoid per-Mbps markups.
At Arkitech Group, we help clients figure out the total cost of ownership up front — and build a plan that can grow as your business grows.
Colocation isn’t free but for the right workloads, it can be a smart long-term investment that gives you control, predictable costs, and better uptime. The key is to know exactly what you’re paying for — and pick a provider that’s transparent about pricing.
If you want help comparing costs for your next colocation project, reach out to Josh Mitchell and Man Wong at Colocapacity. We’ll help you find the right space, power, and network at a price that works for your budget.