Cloud vs. Colocation for SMEs and Startups


Cloud vs. Colocation

When small firms and startups begin to grow, they frequently outsource their data storage and processing needs.

Colocation and cloud services are two high-potential choices for information storage that really can eliminate a costly in-house server.

While they seem to have comparable tasks at first look, they have significant differences in terms of benefits and features. 

While storage solutions are always evolving, and an early 2000s IT professional would be astounded by how drastically the market has reduced storage devices, cloud services storage is still not inexpensive. And merely storing information is only half the battle.

Companies must also be able to move, upload, and download data at a rate that does not cause Windows to anticipate a 2092 ETA.

Exabytes offers both services of colocation and cloud storage, and you can explore both options based on your requirements. 

In this blog, we’ll go through the key distinctions between cloud services and business colocation so you can determine which is right for your company.

What is The Cloud?

hybrid cloud services

The Cloud refers to servers which can be accessed by anyone over the internet. The could be a host to software, databases and many other services These cloud servers are available in data centers across the globe.

Defined – putting your data in Cloud means saving it on the web rather than your own computer.

The biggest advantage of using cloud computing is that companies don’t need to physically manage the servers themselves to run applications on their private machines.

As a business, various options are made available to you when you plan on storing your data on Cloud; let’s look at a few types:

Three Types of Clouds – Public, Private, and Hybrid Clouds

Public Clouds

This is an infrastructure with many servers utilized by a range of businesses. Those are all cloud service providers’ Infrastructure-as-a-Service (IaaS) and Platform-as-a-Service (PaaS) offerings.

In many circumstances, the customer only pays for the CPU, RAM, and storage capacity that they utilize.

Private Cloud

This is infrastructure in a data center, either on-site or off-site, devoted to your data and adapted to your needs.

This private network is only for the company’s usage. Colocation is a private cloud service where an entity purchases its own equipment and servers and keeps it in a data center in its own space requirements.

Related: Enterprise Private Cloud Solution

Hybrid Cloud

This is the situation in which public and private cloud infrastructures coexist. Hybrid cloud computing combines on-premises or colo servers with public clouds, permitting files to flow back and forth for increased agility, safety, and cost-effectiveness.

What is Colocation?

why do i need server colocation hosting

In business colocation, the data is still stored on a hard drive at a specific place owned by the cloud-based company you use, but you only have access to the digital data, not the actual storage device.

In colocation, you are keeping your data at a remote specific address owned by a third party, similar to how cloud service storage works.

Unlike with the cloud services, you are accountable for procuring and maintaining your own servers.

Cloud-based systems are also a suitable option for large organizations that don’t want to regularly replace hardware as it reaches the end of its life cycle, which is usually every 3 to 5 years.

However, such investment returns are only seen on a vast scale. Colocation or a hybrid solution is frequently the best answer for most enterprises.

The Difference Between Cloud and Colocation

Colocation is a service where you provide the gear, and the colo provider hosts it in their data center, providing space, rack, power, and bandwidth.

The cloud is not a physical location; rather, it is software and technology that is accessible over the internet. 

Smaller businesses and startups typically prefer the cloud service over colocation due to its scalability, minimal overhead, and lack of the requirement for an IT team.

Larger corporations frequently utilize colocation to host their servers since it minimizes money usage in the long term and provides the advantage and mobility that comes with complete server management.

Similarities of Colocation and Cloud

Both cloud services and colocation minimize expenses for enterprises, with cloud service providers offering digitized shared public resources.

The resources included within cages and racks are not shared; these are exclusive to the company that owns them.

Colocation refers to shared infrastructure within a data center, although the resources included within racks and cages are not. Shared resources in a business colo facility include:

  • System redundancy and cooling
  • Power and resilience systems
  • Security system

Colocation vs. Cloud Cost

Although cloud services are less expensive and easier to use than colocation for a small startup, the reverse will rapidly and significantly become accurate as your firm expands.

A few gigabytes may be inexpensive to host online but try to find a supplier who will supply a 128 GB RAM, 210 core configuration for a fraction of the price of hosting your personal database server at a colocation site.

Colocation vs. Cloud, which one should you choose?

Choosing between colocation and cloud services is completely dependent on your business needs and requirements.

Primarily, it depends on how much involvement you want your company to have when it comes to storing the data over the internet.

When you put your data out on a public cloud, the provider manages all the low-level support for multiple services.

If there are any outages whatsoever, the cloud services provider is responsible for looking into them.

However, colocation lets you have more control over the data that is being stored. Another important parameter of choosing between colocation and cloud services is your budget restrictions, depending on the amount of data to be stored and the budget you have for the same, you can choose between colocation or cloud services.


Based on your requirements, you can decide the best option between colocation and cloud services that is suitable for your business needs.

Alternatively, you can get in touch with a professional at Exabytes to understand both offerings in detail.

Professionals at Exabytes can help determine your business need more comprehensively and help streamline your data storage through the multiple services they have on offer for server colocation.

Contact Us

For more information:

Exabytes Singapore Data Centre (Server Co-Location)

Exabytes Malaysia Data Centre (Server Co-Location)

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