There is virtually no company or even entrepreneurship that doesn't have at least some minor digitalization. Online corporate presence has become practically indispensable for success. Social media and websites allow businesses to contact each other and make themselves visible to potential clients. They can communicate with their customer base and offer better services online.
Beyond communication with partners, clients and suppliers, businesses also need an internal data processing system. Some are more heavily data-based than others, but all of them need to manage information. They have backlogs of contact data, records of their own activities, digital accountancy and many other sorts of data that they use for their activities. Physical files and folders have been replaced with digital files, and just as once paper was replaced by a computer, now on-site data storage and processing are mutating into off-site storage and digital services.
This is a new market niche for hosting and colocation providers as well as an opportunity for businesses to increase their efficiency and scale up their activities by accessing processing power that goes beyond their onsite capacity. There are many things to consider on how to outsource and how to find the right model, because there are at least three different schemes available: colocation, hosting and the cloud.
To put it briefly, colocation is about renting space for your hardware outside of your company campus. This space is conditioned with all machines need: security, conectivity, cooling, power suppliy. Colocation often takes place in multitenant data centres (MTDC), large offices where you rent as much space as you need and place your own computers there.
Hosting takes a step further by renting not only the space and the power, but also some of the equipment. You get the hardware you need but you don't possess. By going even further and renting the whole infrastructure you have cloud storage, which is the complete outsourcing of your data systems. You get remote access to the data, as well as applications and all software, but all physical elements of these systems belong to another company.
When digital files started to replace physical files, onsite data storage was the only sort of infrastructure available. Companies built larger and larger data servers under their own roof, and that was a big investment in capital, time, personnel and training. One of the main advantages of outsourcing is that businesses don't need to incorporate a new sector they're not familiar with and they lack experience on. Lack of experience leads to unnecessary costs, mistakes and reduced efficiency. Also, new space and energy doesn't have to be occupied with the new sector.
The main attractive of colocation is that you can access the latest trends in intelligent datacentres, while placing your hardware in a fully conditioned environment which is already profesionally managed and mantained by experts, without having to build it yourself with all the expense and time that it takes. In terms of data outsourcing, colocation is the most similar thing to onsite data storage and processing, but with very interesting cost efficiency and professionalism.
Location itself can be an advantage if your headquarters are built in a place that is vulnerable to any environmental conditions that affect computer hardware negatively. In example, you can run a business in the countryside where power shortages are more common, but hire colocation in London thus decreasing the risk with power supply. Other usually dangerous conditions include areas with high risk of hurricanes or flooding.
Coins have two sides, and many of the advantages of colocation also have their negative aspects. Perhaps the main disadvantage of colocation is that you own the hardware, and thus you are responsible for mantaining and servicing it, even retrieving it, but it is placed far from where you are. Colocation often means that you will have to travel, perhaps long distances, every once in a while to check on your hardware.
Also, relocating your software in case you have problems with your provider can be a hassle, especially if relocation is due with short notice. If you find out that your provider isn't as good as you thought and you need to switch to a new one, you will have to face the costs and trouble of moving your computers. Also, the way your provider manages resources such as power and bandwith is out of your control, even if you sign an agreement on service terms.
You need to weigh the pros and cons on colocation before you make your final decision, so you make sure that at the end of the day, you made your best choice.
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