Compare On-Premise vs. Colocation vs. Cloud: Future Trends in Business


Compare On-Premise vs. Colocation vs. Cloud

If you operate a business with IT resources, you have likely had to deal with data storage requirements at some time.

Smaller businesses that increase their IT system must discover methods to store more data and identify the best strategies for the scenario. 

Presently, the IT sector allows us to use several data storage solutions. Some firms opt to employ a combination of these to meet their IT infrastructure demands. 

On-premise data centers, colocation, and cloud computing are the three major methods a corporation may use to store and manage all of its data. 

You’re probably thinking about which solution is best for your organization right now and what you can expect in the future as the business grows and expands.

Exabytes provides information and services on all of these three methods of managing data. 

Below are some of the distinctions, benefits, and drawbacks of each data storage option, as well as which is appropriate for your case. 

Continue reading to learn where to store your information and why one option may be superior for you to another.


Of course, this is the tried-and-tested answer, the way things were always accomplished before us being aware we had an alternative.

The main benefit of having the core of your IT estate on-premises is control. In this circumstance, there is rarely a choice that goes beyond your power.

You can decide what to buy, when to deploy it, and how through an on-premise option. You don’t have to be concerned about some unknown person making configuration changes with which you disagree when you opt for on-premise data storage.

You do not need to be worried about transferring old apps to a new technological platform and dealing with compatibility concerns when using on-premise methods.

You also don’t have to stress about a provider losing business, changing their policies, or changing their pricing structure.

Aside from the problem of control and avoiding unnoticed difficulties, there are some practical benefits to doing things the old way.

  • Compliance: As more compliance laws are enacted, many firms must hold confidential or personal information at a place that is under their supervision to stay compliant, this is possible with an on-premise option.
  • Total and speedier access: Being on-premises involves having access to every one of your systems and infrastructure at all times.
  • Granular customization may be applied to any and all components of your data centre.

However, as is customary in life, having authority comes at a cost. The following are some of the drawbacks for having complete control with on-premise:

  • CapEx: On-premise is the most capital-intensive strategy since your company must fund all facility development and renovations.
  • Lack of flexibility: While you may have initially rightsized your data center to meet your company’s demands, things change over time with an on-premise option. Regrettably, there is no method to scale your physical space dynamically.
  • Labor issues: To maintain control, IT personnel are required. IT knowledge is not cheap. Ironically, you will be competing for talent with cloud computing and colocation companies.

Related: Capital Expenditure (CapEx) Definition, Formula, and Examples

The following are the disadvantages of colocation:

  • Reduced access: While colocation data centers are available 24 hours a day, one must still travel there when a significant hardware malfunction arises. This might have an impact on the effectiveness of hardware maintenance chores.
  • Limited versatility: While colocation providers provide room for your equipment, they do not provide a way for you to remotely monitor it.


A colocation vendor provides you with the physical space and infrastructure to house your computing devices. Power, ventilation, and security are also provided by the provider. 

What you accomplish with the equipment you rent is entirely up to you. You should still maintain and set up all of the equipment involved.

Even though users have no authority over the hosting site, they have full control over the infrastructure. 

This method has several significant advantages:

  • Greater dependability and redundancy: Colocation providers build their hosting infrastructure with resilience in mind from the start.
  • Higher Quality Systems: Colocation suppliers have extensive ventilation, security, and UPS data backups because of their big budgets and efficiencies of scale.
  • Scalability and adaptability: Increasing the capacity is as simple as placing another server inside the rack in colocation.


hybrid cloud computing

Then there’s the cloud, which doesn’t require hardware. This implies no purchase or maintenance expenditures and no worries. This is among the most appealing elements of cloud computing.

Because of the scarcity of hardware, cloud computing option is flexible and agile, which is exactly what digital transformation is about.

Because traffic may be dispersed over numerous data centers in different geographical locations, large cloud computing suppliers can provide even more resilient architectures than colocation models.

The numerous benefits of cloud migration have been thoroughly discussed over the last five years.

The numerous benefits of cloud migration have been thoroughly discussed over the last five years. Among the key advantages are the following:

  • Scalability: Cloud computing allows you to right-size your IT estate effortlessly, which is difficult with hardware-based approaches.
  • Budget predictability: No more worrying about updating pricey servers nearing the end of their life cycle or failing equipment with cloud computing.
  • Less labor intensive: Cloud technology not only eliminates the duty of hardware care but also eliminates boring duties such as repairing and upgrading because cloud computing servers and apps are constantly up to date.

But don’t expect cloud computing to be a cure for perfection. It also has certain disadvantages.

  • Transparency: You are slightly out of the loop if you do not have any influence over hardware resources.
  • Compliance: Some compliance requirements ban the hosting of certain data types in cloud computing
  •  Faith dependency: Moving all of your digital assets to the cloud computing necessitates a high level of trust in the cloud computing provider of choice.


An organization with a significant IT budget and complicated compliance needs, for example, will consider an on-premises option far more practical and appealing than a startup with a single server. 

However, for the average business, colocation offers the optimum mix of performance and price. If you are interested in exploring either of these services, you can contact an Exabytes professional today.


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