When small businesses and startups start to scale, outsourcing their data processing and storage requirements is often the next step.
There are two high-potential candidates for data storage that can replace an expensive in-house server: colocation and cloud services.
While they appear to have similar functions at a glance, these two greatly differ in terms of features and benefits.
In this article, we’ll outline the main differences between colocation and cloud services so you can decide which one is best for your business needs.
What is Colocation?
Colocation is a service provided by data centres wherein businesses can rent space to house their servers and other computing hardware.
This way, they don’t have to worry about the upfront cost of building and maintaining a data centre, as well as the bandwidth and power consumption required to keep their servers up and running.
Colocation services usually come with additional features such as 24/7 monitoring, security, and cooling to ensure that the servers are always online and running optimally.
What are Cloud Services?
Cloud services, on the other hand, refer to a type of outsourcing where businesses can rent access to a remote server or group of servers.
Unlike colocation services, businesses don’t own the hardware when they subscribe to cloud services.
Instead, they’re only renting the use of the server (or group of servers) for an agreed-upon period.
Cloud services are typically delivered through the internet, and they can be divided into three main categories:
- Infrastructure as a Service (IaaS): This type of cloud service provides businesses with access to a remote server or group of servers, which they can use to run their applications and store their data.
- Platform as a Service (PaaS): PaaS provides businesses with a platform, usually in the form of an operating system, on which they can develop, test, and deploy their applications.
- Software as a Service (SaaS): SaaS is the most common type of cloud service. It refers to applications that are hosted on a remote server and delivered to users through the internet.
5 Differences Between Colocation and Cloud Services
Here are the five main differences between colocation and cloud services:
1) Ownership of Hardware
One of the primary differences between colocation and cloud services is how data is stored.
With colocation, businesses rent space in a data centre to house their servers. These colocation facilities provide a dedicated physical space where businesses can store their servers, as well as the necessary power and cooling to keep them up and running. Unlike data storage centres, these server racks are not shared with other businesses.
Cloud services, on the other hand, handle data storage in a completely different way. Instead of a physical server, the cloud provider’s servers are all maintained and secured virtually, as far as the business is concerned. This means that hardware costs won’t be a factor when using cloud services, as businesses will only be paying for the use of the server itself. They’re also shared among other businesses.
2) Additional Costs
Colocation services often come with additional costs, such as the cost of renting space in a data centre, power consumption, software licenses, support and bandwidth consumption. While these incurred costs can add up, they pale in comparison to the upfront cost of building and maintaining an in-house data centre. They’re also often shared with other businesses.
Cloud services, on the other hand, are paid for on a subscription basis. This means that businesses only need to pay for the use of the server (or group of servers) for the agreed-upon period. In some cases, cloud providers will also offer support and maintenance services as part of the subscription fee.
3) Physical Access
One of the main advantages of colocation is that businesses have physical access to the facilities. This means that they can easily install and configure new hardware, as well as troubleshoot any problems that may arise.
With cloud services, on the other hand, businesses don’t have physical access to the server. This is largely because of privacy and security concerns, especially considering that the server is shared with other businesses. As such, businesses will need to rely on the cloud provider for any installation, configuration, or troubleshooting that they need.
Learn more about cloud vs colocation at MDC.
4) Level of Customer Support
Colocation services have an in-house IT staff that is responsible for maintaining the data centre and ensuring that the servers are always up and running. This team is also responsible for providing support for their clients should any issues arise.
Cloud services, on the other hand, are typically harder to get in touch with when problems occur. They may also not be able to provide the same level of support as an in-house IT team. This is because they’re dealing with a large number of clients and may not have immediate access to the necessary hardware.
5) Security & Compliance
Another advantage of colocation is that it’s much easier to comply with data security and privacy regulations, such as PCI-DSS.
This is because you have complete control over who has access to your servers and what they can do with them.
With cloud services, on the other hand, you have to share responsibility for security with your provider. This limited freedom to choose your own security controls can make it more difficult to comply with cloud regulations, especially if your business requires strict compliance.