Manage colocation costs to avoid billing surprises

Last updated:April 2017

Editor's note

The colocation market continues to grow, as organizations look to meet their growing needs for compute outside of their own on-premises data centers. An expansive marketplace of providers offers a plethora of colocation services, but a strong service-level agreement between providers and users -- and understanding colocation costs -- requires more than just a handshake.

IT admins who oversee the transfer of systems and workloads from inside an organization to a colocation facility have a lot of moving parts to deal with. Security, service-language agreement (SLA) jargon and, of course, budget concerns can all be a major headache. Before making the move to colocation, consult with the business side to make sure it's a good financial decision. After the move, be sure to carefully monitor, manage and optimize colocation costs.

1SLA tips and tricks to avoid an unforgiving contract

An SLA helps IT organizations understand their colocation costs -- but it's important to read the fine print. What happens in the event of a power outage? How does the provider handle security at both the physical and technical levels? IT teams need to carefully examine each of these questions, and many others, to ensure the SLA is fully understood before it's signed. They need to understand their responsibilities, versus those of the provider, and whether colocation costs might change over the course of the contract.

2Maintain and optimize your colocation budget

If an organization needs to save money, closing down an on-premises data center may seem like the best way to cut costs. But even after IT teams ship equipment and workloads to a colocation facility, cost management is key. Carefully monitor colocation costs to make sure you aren't bogged down by extra fees and services that don't apply to your organization. Learn what to look for in a colocation bill to avoid unexpected charges down the road.

3Growth, expanded features highlight colocation marketplace

While planning your future colocation budget, be sure to factor in new and evolving colocation provider services, such as interconnectivity to the public cloud, third-party marketplaces and more. Understand the benefits and tradeoffs of these new offerings, and the overall impact they could have on your organization's colocation costs.