What are Cloud Services vs. Colocation Services?

March 5, 2020 By CM Group

Today we’re asking for more and more of our IT departments. We want them to deliver new innovative services in shorter timeframes, all while contending with leaner budgets and smaller staffs. Part of this evolution includes replacing aging on-premise technology and equipment with more flexible counterparts, such as colocation and cloud-based infrastructure services. But the challenge remains: with so many options out there, how do you know what is best for your business? 

Finding the right path

The simplest answer is that it depends on what your most prominent business needs are. Companies generally turn to cloud and data center colocation to gain efficiencies, cut costs, and deliver services on-demand. The key to achieving optimal value is understanding the similarities and synergies between traditional colocation services and cloud-based infrastructures.

What is cloud computing?

The topic of cloud computing is everywhere these days – and it shows no signs of slowing down. In fact, according to a recent study by IDG 77% of enterprises have at least one application or a portion of their enterprise computing infrastructure in the cloud. (Source: IDG). Cloud computing is best thought of as a set of tools, services, and technologies that are delivered over the internet. This includes a model that enables on-demand and convenient access to shared pool resources. This might include networks, servers, storage, applications, and services. Sometimes called an Infrastructure as a Service (IaaS) model, users can access cloud computing resources, networking services, and storage on-demand without having to buy or manage the physical infrastructure. 

Azure, AWS or the Google Cloud platform are good examples of public cloud services. 

These companies deliver cloud services, but they don’t necessarily handle managing the actual workloads or IT functions. Managed cloud providers, on the other hand, care about the entire IT service framework for your business. According to the National Institute of Standards and Technology (NIST), cloud computing infrastructures include five primary characteristics: 

1. On-demand

2. Broad network access

3. Resource pooling

4. Rapid elasticity

5. Measure service (Source: NIST)

How about colocation services? 

Colocation generally refers to a facility that contains all the components needed to run a data center, such as power, backup systems, internet, redundant connections, cooling and HVAC systems, and security devices. Colocation services shift a company’s CAPEX investment once allocated for new IT equipment and data center space, into a monthly operating expense model that’s more predictable. Colocation services are powerful because they give companies the ability to scale quickly. Today’s colo partners are also getting even more sophisticated as well. Many now deliver everything from data center space to managed IT services, and hybrid cloud capabilities. Colocation services may also include giving companies direct connections to the top public cloud providers such as AWS or Microsoft Azure.

Why not both? 

Most organizations today are finding the highest ROI by layering in cloud services with colocation. Why? It shifts companies away from focusing on an infrastructure and operations mindset, to a laser focus on innovation and growth. Utilizing both services is becoming easier because of partnerships between colocation and cloud providers. Customers should look for partners that deliver low-latency connectivity to critical cloud-based apps to reap the biggest benefits. What else should you consider? Let’s dig deeper.

  • Don’t forget about integrations – The tricky part about cloud environments is that they’re not all fully compatible. Most companies need a hybrid cloud network where public cloud providers like AWS and Azure, for example, connect to a private cloud using integrations. Make sure a cloud partner can manage public and private cloud integrations and can properly map data for the best performance considering critical application dependencies. 
  • Look at Service Level Agreements (SLAs) carefully – Cloud providers should offer guarantees around availability based on SLAs. It’s also critical to understand how partners control access to the environment, how they’ll manage infrastructure resources, and how they address making changes as demands change. 
  • Consider compliance needs – Any company that handles credit or debit card information needs to be aware and adhere to PCI DSS requirements. Make certain colocation partners can determine the optimal place for data and can safeguard data as it crosses colocation, public cloud, and private clouds. 

Making your move

Both cloud services and colocation offer alternatives to a traditional in-house data center and on-prem computing approaches. Companies should consider their requirements and weigh their options carefully balancing costs, compliance, and privacy, and needs around availability and uptime. Taking an open-minded and deliberate approach can often serve you best.