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Data center colocation can help small organizations keep up with larger competitors.

3 ways data center colocation helps you keep up with competitors

Small organizations can work with a colocation provider to access resources that they wouldn't be able to afford on their own. This access to robust data center assets can prove ideal for small or medium-sized businesses that have robust technology requirements and compete with larger companies that have significantly more resources. Colocation can level the playing field in this situation, freeing smaller companies to establish the innovative solutions they need in a cost-effective way.

Three distinct aspects of colocation that help level the IT playing field include:

1. Cost-efficient leasing models
When a small business is highly dependent on sophisticated technologies, it is at an immediate disadvantage in the market. Large organizations in tech fields can build robust data centers and hire the staff they need to manage them. For example, a major cloud vendor can custom build a state-of-the-art facility to meet its specific needs, while a startup cloud provider will likely lack the funds to put so many resources into its own facility.

Data center colocation vendors offer incredibly reliable, resilient and advanced data centers with space for lease, allowing smaller companies to get exactly what they need without having to find the capital resources that would be required to build a private facility.

2. Robust network systems
Data center connectivity is a priority for smaller organizations, especially as more companies depend on distributed workforce and technology models. Colocation providers can offer access to high-performance interconnects and are well placed relative to operator networks. These network strategies empower colocation clients to move data quickly between locations and out to customers without having to invest too heavily in expensive WAN solutions, making it easier to keep up with larger competitors.

3. Scalability
Consistent growth is the goal for any business, but dealing with unexpected expansion spikes is a difficult challenge for small businesses. When a company suddenly gets a huge new client, but lacks the infrastructure to support the customer, it is faced with a difficult financial decision. A colocation provider offers scalability, making this kind of situation much easier to deal with. In this case, small organizations don't need to commit to a huge data center expansion, but can just lease some more space to meet their new needs and avoid making huge financial commitment. This scalability makes it easier to sustain growth in a healthy way.

There is a lot of talk about cloud computing as an equalizing in the IT world. However, tech-focused companies will often have sophisticated or sensitive data and apps that won't reside well in the cloud. Colocation can be an ideal option for these businesses.

Cloud computing is fueling data center colocation industry growth.

Data center colocation rising at a 17.6 percent CAGR

The meteoric expansion of the cloud computing is good news if you are a colocation provider. A recent study from MarketsandMarkets found that the colocation industry is poised to experience significant growth moving forward, with much of its rise coming as organizations turn to colocation to complement their various cloud strategies.

The news source explained that the colocation industry experienced revenues of approximately $16.65 billion in 2014. Moving forward, increased enterprise dependence on cloud computing is going to leave organizations for a more cost-efficient, stable way to host their corporate data center resources. This and the rise of other Internet-based services will lead the colocation industry to revenues of approximately $49.57 billion in 2019, creating a compound annual growth rate of 17.6 percent for the period.

According to the study, data center colocation is rising across a wide range of verticals because it is able to offer finely tuned data center services in an efficient way, creating an environment in which it is easier to meet regulatory compliance standards.

Colocation can be a powerful regulatory compliance solution because a colocation vendor that also serves as a data center services provider can manage all of a client's systems in line with regulatory laws, making it easier for organizations to attain industry excellence without disrupting its own IT staff.

Data center colocation promotes financial efficiency in a variety of ways.

4 ways data center colocation promotes fiscal efficiency

Businesses that partner with a colocation provider give themselves an opportunity to improve their financial flexibility and health. Maintaining a robust IT setup is a costly manner, and not just when it comes to pouring money into technology systems. Managing your staff, staying ahead of the competition, sustaining innovation and improving efficiency. Organizations that rest on their laurels are prone to fall behind the technological curve as businesses become more dependent on IT resources to get the job done. Finding IT solutions that promote fiscal health is integral to continually improving functionality because it frees financial resources to ensure the budget is flexible enough to support continual growth.

Data center colocation plays a vital role in helping organizations maintain the fiscal elasticity they need to operate in an agile way. Four ways colocation can promote this flexibility include:

1. Reduced capital costs
In most cases, subscribing to a colocation plan will be less expensive, from a capital cost perspective, than building your own data center. Freeing capital resources can play a key role in giving organizations financial freedom because they can repurpose those funds for special projects that drive innovation or improve day-to-day efficiency. For example, spending less on the data center itself can create more space in the hardware budget, allowing organizations to purchase higher quality systems that will last longer, staving off a hardware refresh and creating even more capital spending flexibility.

2. Scalability
Data center colocation providers have excess floor space and power capacity built into their facilities to enable clients to add hardware as needed over time. In many cases, organizations turn to modular methodologies, which can be employed in diverse ways, to make it even easier to add new capacity over time. This flexibility ensures that you can cost-effectively adjust your configuration as needed, making sure that space limitations do not hold back your IT plans. At the same time, this scalability is delivered much less expensively though colocation than it would be in a corporate data center.

3. Sustainability
Colocation facilities generally feature a fairly homogeneous architecture so that the data center can support a variety of clients without any trouble. This prevents colocation providers from taking on extremely unusual and creative efficiency plans. However, the economies of scale that go into colocation free vendors to put more resources into efficiency strategies than most businesses, giving them freedom to establish robust sustainability plans. In many cases, colocation vendors can significantly reduce your utility bills through efficiency programs, leading to lower ongoing costs and greater freedom to put money into special projects.

4. Easier access to new technologies
Many businesses find themselves in situations where they want to invest in new technologies, but need a corresponding data center upgrade to support the project. This makes the cost of innovation prohibitive. A colocation plan creates the facility freedom needed to reduce the costs of making IT upgrades and investing in new projects. For example, a company that wants to purchase a high-performance computing system to support big data plans often needs a specialized data center environment. Colocation facilities can support these types of systems in a cost-efficient way, creating the fiscal freedom to make the upgrade effectively.

All of these issues are not directly tied to finances, but the technological capabilities, such as scalability, discussed here play a key role in creating long-term fiscal health. Data center colocation has so much potential in promoting financial stability because it has a meaningful positive impact in so many areas of facility operations. The result is more financial freedom that creates a smooth path for continual IT progress and operational efficiency.

Data center colocation and the cloud often go well together.

Data center colocation can ease cloud security concerns

Many cloud vendors will work with a colocation provider to establish secure, efficient data center setups. At the same time, businesses can use colocation as a way to solidify their cloud plans and establish a configuration that eliminates many security and data protection concerns.

According to a recent TechTarget report, the control, ownership and security issues commonly associated with the cloud is giving organizations pause when it comes time to make technology decisions. In response, many organizations are establishing a private configuration in a colocation facility and connecting it directly with a public cloud. While this type of setup is rarely available directly through public cloud vendors, it is emerging as a popular way to deal with cloud concerns like ownership, control and security.

Furthermore, the news source explained that the superior LAN speeds offered by colocation providers can improve cloud performance. In the end, a model that combines colocation and the cloud is often more expensive than a typical cloud setup, but the advantages are worth the cost.

Creating value through data center colocation is possible in a variety of ways. In many cases, businesses that leverage colocation gain access to network, security, flexibility and advanced facility resources that make it easier to establish sophisticated IT systems.

Data center colocation offers a variety of security benefits.

5 ways data center colocation supports security advances

Establishing a secure IT setup is an incredibly challenging prospect that can be made much easier by partnering with a colocation provider. Improving security is not simply a matter of sticking infrastructure in a third-party facility, but there are many aspects of a colocation service that empower organizations to improve security. This is especially true as colocation providers offer nuanced service options that combine physical asset protection, logical data security and regulatory compliance. Five ways that colocation can promote security advances include:

1. Layers of firewalls
Colocation providers are able to offer customers a variety of network services that simultaneously isolate the internal connectivity systems within the colocation facility and improve data security moving out to the WAN. The result is a situation in which it is easy to establish multiple layers of firewalls to segregate different data sets and ensure that information moving between systems is not being exposed to unauthorized access.

Most colocation vendors offer advanced data center interconnects that provide a closed, controlled link to operator networks that deliver data through the WAN. A firewall at the entry and exit points of the interconnect can combine with firewalls surrounding your specific systems within the colocation center to ensure that hackers are not able to gain access to your systems through the network.

2. Access control
Highly secure systems behind firewalls are difficult to breach via the network, and some hackers will turn to physical methods when facing such a challenge. Instead of using the network to intrude into the infrastructure, these individuals will try to find a way to gain direct access to systems, often through getting into the facility where systems are stored. This can be accomplished via an insider threat or by sneaking into a data center that lacks proper security protocols.

Data center colocation vendors are able to offer a variety of access control solutions, and need to do so as part of their core business model. Because colocation is built around a multi-tenant environment, most providers will segregate different parts of the facility based on client permissions and even add locks to specific racks or cabinets depending on operational needs. At the same time, vendors will usually have multiple layers of access control to get into the facility itself, providing holistic protection that is expensive to match in a private data center.

3. Regulatory compliance
Security isn't just about keeping unauthorized people from accessing data. It is also necessary that organizations follow infrastructure and data management best practices to ensure information is not lost and that any configuration changes do not create an opportunity for a data breach. Regulatory compliance standards establish specific practices that help an organization provide a minimal acceptable level of data protection for the industry they work within. Many colocation providers are able to fine tune their services, including any management consulting or operations that they offer, in light of specific regulatory guidelines. 

All told, a colocation service can play a huge role in simplifying regulatory compliance. This is especially true because many regulatory standards tell you what you need to accomplish, but give you freedom, and uncertainty, when it comes to getting there. Colocation providers can offer expertise and management help that puts your organization in the best position to comply with industry standards.

4. Data center services
It may not be the most sophisticated reason for a data breach, but many security problems emerge simply because businesses don't have time to update software, adjust the configuration to avoid a vulnerability or make a similar change. Many colocation vendors will also act as a data center services provider if you want to subscribe to such a plan, giving your IT team the help it needs to handle the kinds of day-to-day management tasks that create a secure configuration. A variety of aspects of IT configuration management come together to promote security, ranging from network hygiene to performing efficient application releases, and the help offered by data center services can be invaluable in helping organizations stay ahead of the operational curve.

5. Control
Maintain control over the IT configuration and data is a key component to keeping information safe. Many companies will choose not to move some apps and services into the cloud specifically because they lose some element of control. A colocation plan enables organizations to take advantage of third-party data center resources without giving up any control of the infrastructure. Businesses still own the hardware and have the ability to manage it in person.

Using data center services alongside colocation can enable the provider to manage the configuration for you, but you can establish a service level agreement that controls who can access your systems, what data and apps they can interact with and how they document these practices.

Security needs to be a priority for businesses, and data center colocation is among the third-party IT service options that can have a huge positive impact on data protection.

Data center colocation can be an ideal option for cloud providers.

3 reasons data center colocation is attractive to cloud vendors

Conversations about similarities between working with a colocation provider and turning to the cloud are fairly common. This is highlighted in the growing trend of cloud providers hosting their infrastructure in colocation facilities to avoid the costs and complexity of building their own infrastructure. The advantages of such a setup are numerous, but three benefits stand above the rest to demonstrate why colocation services can deliver a huge return on investment to cloud providers.

1. Scalability
The ability to scale application and infrastructure resources based on user demands is one of the hallmarks of cloud computing, but those benefits are only applicable if the cloud provider has the data center space needed to add new hardware to the configuration once existing system resources are used. However, cloud vendors cannot afford to have large portions of a private data center left unused, as the waste in terms of initial configuration costs and ongoing problems in everything from airflow management to resource optimization is considerable.

The scalability offered by colocation providers gives cloud vendors the freedom to build just the right amount of extra resources into their existing configuration while still being able to expand their configuration by adjusting their deal with the colocation provider as necessary to lease more floor space.

2. Management help
Many colocation providers will function as data center services providers, helping clients manage their infrastructure based on specific service level agreements that designate precisely what the vendor will provide. While many cloud companies will likely want to handle most day-to-day management tasks themselves – handling their cloud systems is their core competency after all – they can use data center services for help with the initial data center move, and infrastructure changes that need to be made or in emergency response.

3. Access control
Cloud vendors need to carefully manage who can access which systems and document related processes to comply with regulatory standards. This extends out to physical access to servers and storage machines, and access control is a major priority to prevent unauthorized users from interacting with systems and data. Data center colocation facilities feature access control strategies that go well beyond what many companies can establish on their own, making it much easier to comply with regulatory standards.

Cloud providers are facing an infrastructure arms race in which even small vendors need to be able to offer configurations that keep up with the giants of the industry. Working with a colocation provider can give any cloud vendor the data center resources they need to establish a solid foundation for success.

Data center colocation and the cloud often intersect.

Data center colocation closely linked to the cloud

Partnering with a colocation provider and working with a cloud vendor present many similarities. In fact, colocation can offer many of the benefits of the cloud while giving organizations control over their infrastructure. However, colocation and the cloud are not interchangeable, creating an environment in which the two industries are linked, but not likely to have a huge impact on one another.

A recent Gigaom report making predictions for 2015 suggested that colocation and cloud computing are both set for growth, but colocation will not swipe significant profits away from cloud providers. While data center colocation is able to give clients some advantages over the cloud, the market situation is one in which different types or organizations will be looking at colocation than those that would consider the cloud.

The news source pointed out that the mainstream cloud customer is not going to want to deal with the technical nuances of colocation, even though the service model is moving beyond its reputation as a glorified real estate industry.

Data center colocation does indeed offer much more than real estate. Leasing space in a colocation facility gives companies a wide range of technical benefits because the state-of-the-art resources available through a colocation plan empower IT leaders to establish a more robust and sophisticated configuration with the data center.

Standardization is vital when moving to a data center colocation facility.

Process excellence key when making a data center move

The rise of data center colocation has contributed to an environment in which organizations will likely experience more frequent facility migrations. A recent TechTarget report explained that the combination of colocation and a focus of centralizing IT assets has made data center moves more common. For a long time, IT leaders never spent much time focused on transitioning to new facilities. This type of project was looked at as a once-in-a-lifetime situation, so putting significant resources into figuring out the best way to make the move didn't make much sense. With centralization and colocation as common themes across the IT sector, IT teams need to be ready to move more frequently, and striving for process excellence becomes critical.

Considering the complications of a data center move
Transitioning to a new data center is an incredibly complex and difficult process. This issue has always been central to any migration plan. The problem facing organizations is not really about new complexity or challenges when making a move, those issues are the same as they always have been. Instead, the major  concern hitting organizations is all about the frequency of moves. The news source explained that trends like data center consolidation are making moves much more common, something that industry expert Danny Aldham explained is problematic because most organizations do not have standardized processes surrounding data center migration.

"People will go out and wing it, but you end up on your third or fourth [move] and think, 'Why are we doing this alone?'" Aldham told the news source. "Other people are in the same boat."

Aldham went on to tell TechTarget that there are many move-related processes that are the same regardless of the organization. For example, something like needing to physically move servers between locations will present pretty much the same challenges and issues regardless of the specific details of your company. Similarly, tracking inventories and shutting power down to systems requires the same core processes regardless of what business you work for. The result is a situation in which organizations can standardize many move functions, something that can make it much easier to ensure a smooth transition to a new facility as companies complete data center moves with greater frequency.

Understanding the growing role of process standardization
With moves becoming more frequent across the data center sector, the desire to create standard best practices within an organization makes plenty of sense. David Cappuccio, a research vice president at Gartner, told TechTarget that performing a dependency mapping exercise is an example of a key process that should be considered a standard part of any data center move. He explained that the dependency map, when completed down to the level of IP addresses, shows organizations which systems rely on one another and how shutting different infrastructure down will impact data center functionality. Creating this transparency in a standardized way can reveal precisely when different systems can be moved without risking unplanned downtime, allowing for a much more stable and efficient migration.

Standardizing processes during a move becomes important because organizations cannot afford to take a new approach to every move they make. The data center without walls movement is promoting a situation in which organizations will work to consolidate their core IT functions while leveraging various data center services to handle everything else. The result is a need for an incredibly robust primary facility and increased reliance on solutions like colocation. Working with a colocation provider can help companies establish data centers in remote locations with relative ease – to reach distant customer bases, support corporate expansion or create a backup configuration. This can lead to a large number of migration processes, and having a clear strategy for these moves can ensure a smooth transition to the new service model.

Not everything can be standardized
Aldham told TechTarget that while a wide range of processes are easy to standardize, there are also plenty of aspects of a data center move that are not as easy to repeat over multiple moves. In particular, software issues stand out.

"There are only so many ways to move a server, but for applications, the procedure will change every time," Aldham told the news source.

Taking full advantage of colocation during a data center move
A colocation partnership is often a relationship built around common gains. Both the colocation provider and the client stand to create value from the partnership, and some vendors take these mutual benefits to heart and will take a consultative role in helping customers get the colocation plan off to a good start. Many vendors will help you make a data center move into their facility, creating a situation in which you can take your standardized processes and refine them with the help of the vendor to meet the specific demands of moving into a data center colocation site.

A good entry plan is key when subscribing to data center colocation.

5 tips to get a data center colocation plan off to a good start

A partnership with a colocation provider can deliver value in a variety of ways, and organizations that want to maximize their success need to make sure they get their effort off without any hitches. Getting a colocation plan off to a good start ensures that your organization is well placed to maximize the value of the service model from the outset, creating an optimal return on investment. These quick tips will help you get a colocation play off on the right foot:

1. Develop a good partnership
Some colocation providers may be happy to have you lease space in their facility and do with it what you will. However, the ideal situation is one in which the partnership is built on mutual trust and benefits, allowing you to work well with the provider to optimize your configuration within the facility setup. A good partnership can ensure a smooth start to any colocation project.

2. Don't neglect the data center move
Migrating to a new data center, whether you are moving existing systems there or building out a configuration with new infrastructure, is an incredibly complex process. Make sure you pay plenty of attention to the process of moving to the new facility to avoid any unnecessary problems during the transition.

3. Consider data center connectivity services
The high-performance interconnects, WAN optimization and WAN acceleration systems that are common with colocation can deliver incredible value throughout a colocation partnership and ensure that you don't run into any network performance issues at the outset of a plan. Taking the time to identify how you can leverage connectivity solutions offered by the vendor can pay dividends throughout the life of your colocation strategy.

4. Take advantage of data center services as needed
Many colocation vendors will also serve as a data center services provider, a role in which they will manage your infrastructure for you. This can be valuable in a variety of ways, particularly if you are trying to establish a configuration in a relatively distant facility – perhaps to expand to a new market or support disaster recovery.

5. Consider long-term plans
Colocation partnerships are generally a flexible, scalable data center hosting option. As such, getting into the partnership with a long-term vision in mind can position you to refine and adjust the configuration over time to maximize its value.

Data center colocation can deliver value in a variety of ways, and businesses that get their partnership off to a good start can position themselves well for long-term gains.

3 ways data center colocation isn’t like the cloud

Many organizations think of working with a colocation provider as another way to turn to the cloud. The confusion is understandable. Many people define the cloud as delivering IT services, be it infrastructure or apps, via the Web, and colocation services often use the WAN to deliver customer resources. Furthermore, plenty of cloud services are delivered via colocation facilities. All this said, the uncertainty is understandable. However, there are plenty of aspects of colocation that stand separate from the cloud. Three ways colocation varies substantially from the cloud include:

1. Ownership confusion isn't an issue
One major problem with the cloud is that there is some uncertainty about who actually owns data assets. Service level agreements are dealing with some of these concerns, but colocation plans eliminate any of the uncertainty in this area. Organizations leveraging data center colocation own the hardware, they can manage it themselves if they don't want to subscribe to data center services and they can control who has access to systems. This control eliminates all issues of ownership, as the organization leveraging colocation maintains all of the key infrastructure elements in play. With colocation, the primary focus is leasing data center space, eliminating any ownership fuzziness when it comes to the IT configuration.

2. Colocation can handle performance-sensitive workloads
Cloud computing's heavy dependence on virtualization and automation layers makes it difficult to support high-performance systems in the cloud. Data-rich apps and services can struggle to perform adequately hosted in a cloud environment, but organizations can put whatever IT setup they need in the colocation facility, making high-performance workloads viable in the third-party environment. Furthermore, the advanced WAN optimization and acceleration systems in place as part of colocation data center connectivity plans ensure that information supporting these apps can get where it needs to go with minimal latency. The resulting technology environment is ideal for performance-sensitive workloads, something that is much more difficult to obtain in a traditional cloud environment.

3. Colocation creates configuration freedom
Unless you're building your own private cloud, most cloud strategies involve some form of out-of-the-box functionality. You are limited by what the provider can offer. As colocation is about leasing facility space, not IT resources, the service model actually empowers you through a more flexible data center setup. This leaves organizations with the freedom to build the type of configuration they need in the colocation facility, eliminating many of the restrictions of the cloud.

Data center colocation and the cloud have some similarities, but in the end the two service models are distinct in significant ways.

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