The cloud isn’t the only buzzword being embraced by a growing number of businesses. Companies are also warming up to colocation services in an effort to reduce their overhead expenses and improve their efficiency. This upward trend hasn’t gone unnoticed by analysts, who have predicted a compound annual growth rate (CAGR) of 13.6 percent for colocation services through 2018.
There are plenty of reasons why businesses are now counting on colocation for their data storage and management necessities.
Colocation offers lower expenses than in-house data hosting.
In the old days, businesses relied on in-house hardware along with their own IT teams to handle their data needs. However, the up-front costs of designing and building a data center, along with maintenance costs and the steep expenses required to power and cool that equipment, often proved formidable to a company’s bottom line.
These days, paying a third party to utilize their dedicated facilities and equipment has proven more cost-effective than using in-house alternatives for data storage and management. To the average CFO, paying monthly fees for colocation makes more fiscal sense than the initial and long-term outlay for an in-house data solution.
Colocation centers are highly equipped for a business’s needs.
Colocation also packs a punch when it comes to computational power. These facilities not only have a much smaller footprint than most in-house solutions, but they’re also more powerful than most designs put into place in most in-house builds. This offers the average small and medium-sized business a definite advantage: access to the fastest and most efficient infrastructure available.
Businesses are growing more concerned with data security.
Thanks to highly publicized data breaches and other security failures, businesses are concerned about the security of their data more than ever. There’s also the issue of compliance with a growing number of regulatory statutes, and each has its own set of concerns for achieving and maintaining compliant status.
Instead of worrying over digital and physical security with an in-house setup, companies are handing off those concerns to seasoned experts within the colocation industry. Most colocation facilities have the staff and the training to remain up-to-date on the latest security threats and to address other security needs when warranted.
Businesses want to keep up with the latest technology.
The swift currents of changing technology often mean that some businesses can’t keep pace—at least not when it comes to their data infrastructure. The in-house infrastructures of old are quickly giving way to new and improved technologies that promise greater efficiency and lower costs.
For example, many companies are turning to their colocation providers for localized monitoring and management instead of using their own staff to remotely handle their colocated equipment. This allows in-house staff to remain focused on their core competencies while leaving the burden of continual development and training of new technologies to the colocation providers.
Given these benefits, it’s not hard to see that colocation is offering businesses many advantages when it comes to handling their data infrastructure. As businesses continue to refine and streamline their business strategies, colocation and other innovative services will see continued gains in the competitive marketplace.