Colocation services are for those that require complete control over their server configuration.

Colocation is a service in which a company will connect a server that you own to the internet. If you do not already have one, some companies offer to build a server for you. This is the key difference between dedicated servers and colocated servers. In a dedicated environment, the server itself is owned by the web hosting company, whereas in a colocated environment, the server is your own.

There are two costs associated with colocated servers – rental fees and connection fees.

Rental Fees – These are the costs associated with actually having your server located in the web host’s datacenter. Ranging from 1U to a full rack, this measurement is the height of the server(s) being hosted. Most servers come in either 1U or 2U configurations. Servers with a large number of harddrives can be as big as 3U or 4U.

Connection Charges – Instead of measuring the total number of gigabytes transferred per month, a connection average is usually used. So a 1 mbp/s connection means that you can average 1 megabyte of transfer per second for the entire month. Getting more complicated now, there are two other things to consider.

Firstly is how this transfer is measured. Some simply take the amount of bandwidth used that month, divide it by the number of seconds in that month, and come to a figure that way. Much more popular though is a system called ’95th percentile’ in which bandwidth measurements are taken every 5 minutes. At the end of the month, the top 5% of readings are discarded, and the highest remaining reading left is what the user is billed at.
This brings us to the second point – burstable connections. While you may be allowed to average 1 mbp/s, you can suddenly burst to a higher transfer rate. With a system of measurement such as 95th percentile, you have to make sure that you do not need to burst your connection often.

Since you are entrusting your server in the hands of another company, there are other things to be aware of –
Facility – It is important to know where your server will be physically located.

Physical Infrastructure – Natural disasters can and do occur. You want to ensure that your server and the data it contains is kept safe.

Security / Access – Just as you would not allow anyone into your server, you want to make sure that only people with the proper authorization will have access to your server.

Bandwidth – Not all internet connections are equal. For more detail, please refer to our page on differences in bandwidth.

IPs – If you want to be using features such as Anonymous FTP, private nameservers, or game servers, having multiple IPs can become important. The host should be checked for how many IPs they can provide and at what cost.

Support Options – This is important with any type of hosting. You want to make sure that the people that work with your servers are both knowledgeable and helpful.

Cross Connect Fees – This is a more advanced feature. In certain places, you can actually physically co-locate your server with one host, while having the internet connection provided by another host. These additional fees are called cross connect fees.

Uptime Guarantees – Just as they are very important in virtual hosting, it is extremely important to ensure that your host has guarantees in regards to the performance of your connection.

Contract – The fine print is always important. Things to be noted include the terms of service, an uptime guarantees, and the contract length.
If you are looking for a company to colocate with, we ourselves use Rack Space