In today’s constantly changing technological world, it has become increasingly necessary for businesses to secure space in data centres. It allows them to store necessary IT equipment safely and flexibly.
This is where colocation data centres come into the picture.
According to Custom Market Insights, the global data centre colocation market is expected to grow from $62.46 billion in 2023 to $71.27 billion in 2024, with a compound annual growth rate (CAGR) of 14.1%. By 2030, the market is projected to reach approximately $131.8 billion.
This article tells you everything you need to know about a colocation data centre, what is it, why is it important, and its use cases.
What is a Colocation Data Centre?
A colocation data centre, also referred to as a “colo,” is a physical infrastructure where organisations can rent space to store their servers, networking equipment, and other storage devices, typically housed in data centres.
This specialised infrastructure ensures a business’s equipment is safe and secure, well-powered, and connected to high-speed networks for processing tasks. Colocation helps businesses meet most of their IT needs while still optimising costs.
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How Do Colocation Data Centres Work?
Colocation data centres (colo) let organisations lease space within their centre's space. This allows them to store their IT equipment, use the common energy infrastructure, and benefit from its strong security measures.
In the colocation concept, businesses will usually rent space within a shared data centre. This could also just be leasing rack space cupboard or a room. The allocated space however should be well-guarded and powered efficiently to ensure organisational property is not only protected but also is running its tasks smoothly.
In addition to protecting IT equipment and servers of and for individual businesses, data centres will usually automate certain tasks. These include security measures including 24/7 surveillance, biometric access control, and fire suppression systems, to protect the physical infrastructure and the valuable data stored within.
Also Read: How AI Growth is Impacting Data Centre Demand
Why Are Colocation Data Centres Important?
1. Cost Optimisation
Colocation data centres are important for cost optimisation for individual organisations especially if they only need a minimal amount of space to harbour their IT equipment. Leasing just a specific area of a data centre can help businesses avoid unnecessary costs linked to building and maintaining their own data centre.
Such expenses often include real estate costs, construction, power infrastructure, cooling systems, and security personnel.
2. Security
Additionally, colo data centres are a great way for individual organisations to secure their IT systems as the focus for such specialised infrastructure prioritises security. By housing their equipment in a secure, controlled environment, businesses can significantly reduce the risk of cyberattacks, physical damage, and other security threats.
3. Scalability
Colo data centres also provide organisations with scalability options which lets them manage their IT infrastructure according to constantly changing requirements rapidly. With growth in business, scalability becomes an imperative factor to keep up with the demands and industrial advancements.
Data centres with colocation provide that flexibility whether an organisation needs an extra room to store servers or needs to get rid of a desk not needed anymore. Colocation providers usually accommodate the changing needs of a business.
This flexibility also allows organisations to adapt to changing business demands without the need for significant upfront investments or long-term commitments.
Use Cases
1. Data Reality
Data Reality is a real estate investment trust that runs data centres around the world. This company’s colocation solution available through its PlatformDIGITAL helps organisations stay flexible, adapt quickly and leverage new opportunities.
The firm ensures organisations’ nIT infrastructure is safe from malicious actors, natural disasters, and other threats. It also encourages modernising hybrid IT workflows to improve the performance of an organisation’s applications and services. This further helps unlock innovation and efficiency and saves costs.
2. Equinix
Equinix’s colocation data centres hone in on the concept of mission-critical data centre capacity at the interconnection crossroads of an organisation’s clouds, backbone, digital ecosystems and edge.
The company provides their clients with the space to build adaptable and scalable hybrid infrastructure. This also allows them direct access to capacity across physical colocation, networking, public cloud and an organisation’s as-a-service ecosystem.
The firm has strategised its locations in an efficient manner to provide adequate traffic flows. They provide the lowest latency and the highest network capacity.
