Choosing the right colocation strategy is a critical decision for businesses seeking to optimize their IT infrastructure. When it comes to colocation, the decision narrows down to two primary options: shared and dedicated colocation. So, how do you determine which is the best fit for you?
In this article, we are going to explore the most prominent differences between shared and dedicated colocation, examining both their benefits and their potential challenges. Understanding the distinctions is essential for making an informed decision that aligns with your business goals and operational needs.
Shared Colocation & Dedicated Colocation: a Quick Review
Before getting into the nitty-gritty of each option and its pros and cons, let’s briefly define both types.
Shared Colocation
Shared colocation is a data center renting model offering space within a data center where multiple tenants share the same physical infrastructure. In this shared area, you can lease a portion of a server rack or a full rack, depending on your business’s needs. Your hardware and data are separate, but you share the general infrastructure with everyone else. Because of this, the full cost of the data center resources like power, cooling, security, and connectivity are divided between the tenants, making shared colocation a cost-efficient solution for businesses requiring robust infrastructure but having limited budgets. Shared colocation is recommended for organizations that don’t need much customization but want to benefit from the cost-efficiency, reliability, and professional milieu of the colocation data center.
Dedicated Colocation
While with shared colocation, the racks are shared between tenants, dedicated colocation refers to leasing an entire server rack or a private suite within a data center exclusively to one company. Depending on the company’s needs, the size of the space can range anywhere between a private room, floor, or a whole building. This model provides businesses with full control over their infrastructure, ensuring that no one else can access that part of the facility.
Dedicated colocation allows businesses to tailor their environments without interference from other tenants. Because of this, dedicated colocation is best for businesses with high-demand applications and enhanced security and compliance needs. Dedicated colocation comes with higher costs compared to shared colocation, but on the other hand, it offers the perks of performance, security, reliability, and customizability.
6 Criteria to Consider When Choosing Between Dedicated and Shared Colocation
When choosing the colocation model for your IT infrastructure, the following factors should determine what you pick.
1. Your Budget
The cost difference between shared and dedicated colocation can be quite significant. Shared colocation is more affordable and better for smaller businesses with a limited budget or businesses wanting to save. Dedicated colocation requires a higher investment for the exclusive use of infrastructure, elevated security, and high performance.
2. Scalability
Growth plans have a big say in choosing between dedicated and shared colocation. If starting out with presumably modest and predictable growth, shared colocation is better. If your business is anticipating rapid and unpredictable growth, dedicated colocation is the better option because of its flexibility and reliability perks.
3. Performance Requirements
High-performance applications can benefit more from dedicated colocation due to its guaranteed uptime and resources and the minimized risk of interference from neighbors.
4. Security and Compliance Needs
For businesses handling sensitive data with stringent security requirements, dedicated colocation would be the smartest choice. Companies in industries with strict compliance standards can benefit from enhanced physical and network security of the dedicated colocation solution.
5. Control and Customization
Businesses needing full control over their IT infrastructure with complex hardware and software configurations will find dedicated colocation more suitable. Shared colocation does offer some degree of customization in the form of smart hands services; however, it’s much more limited than what a dedicated solution can offer.
6. Available IT Team
Dedicated colocation requires a lot of management and technical maintenance, which the company has to perform. For small businesses that don’t have a team of IT specialists to deploy for these purposes, shared colocation is a better choice. Providers often offer a broad range of managed services smaller companies can benefit from.
Shared Colocation vs Dedicated Colocation: the Pros and Cons
After carefully considering the criteria above, let’s go further and look at the pros and cons of both dedicated and shared colocation.
Shared Colocation – the Pros
- Access to Advanced Facilities
Smaller businesses can reap the benefits of gaining access to technologies, connectivity, equipment, and infrastructure that they couldn’t afford independently.
- Low Cost
Shared colocation is generally more affordable as the infrastructure, power, and cooling bill is distributed among the tenants.
- Resource – Efficiency
Because resources are shared, businesses can avoid the extra costs of underutilized infrastructure. Shared colocation also benefits energy use, which not only leads to lower costs but also contributes to a more sustainable approach.
- Scalability
Renting in shared colocation allows you to scale up or down as your needs require. Because of this, it’s ideal for small businesses that need a scalable solution without significant upfront investment.
- Maintenance and Managed Services
The colocation provider can handle maintenance and offer extensive managed services like real-time system monitoring and technical support. For those about to choose between unmanaged and managed colocation, these services can be a treasure trove for businesses lacking the resources to manage their infrastructure.
Cons of Shared Colocation
- Less Control
You have less control over the shared environment, which can limit hardware and software customization.
- Security Concerns
Because the infrastructure is not dedicated to a single organization, the risk of security breaches and interference will be higher.
- Resource Contention
Performance can be affected by other tenant’s activities in shared colocation. Peak times can slow down performance and lead to lower-quality service.
- Compliance Issues
Shared colocation might not be enough to cater to the needs of businesses handling sensitive data. Meeting regulatory requirements like HIPAA can be challenging since the organization doesn’t have full control over the environment.
- Noisy Neighbours
Sometimes, the activity of other tenants can influence the overall uptime and reliability of the shared colocation infrastructure. This can, of course, affect all the tenants and influence hardware health and uptime.
Pros of Dedicated Colocation
- Granular Control
Dedicated colocation allows organizations complete control over their hardware and software configurations. Moreover, you’re free to design your environment as it best fits your needs.
- High Security
Because infrastructure use is unshared in the rented space, businesses can implement robust security measures and reduce the risk of breaches associated with shared environments.
- Guaranteed Performance
With dedicated colocation, all resources, like bandwidth, cooling, and power, are exclusively available to one organization only. Because of this, performance is consistent and highly reliable.
- Compliance
It’s easier to meet stringent regulatory and compliance standards with dedicated infrastructure, as businesses can customize their environment to adhere to the different requirements.
- Scalability and Flexibility
Dedicated colocation offers more flexibility to scale resources up or down as needed, supporting the growth and changing needs of organizations expecting to expand.
Cons of Dedicated Colocation
- More Expensive
Dedicated colocation costs much more than shared colocation because of the exclusive access and use of infrastructure and resources.
- Maintenance Responsibility and Complex Setup
Companies renting infrastructure in a dedicated environment are responsible for maintaining and managing everything. This isn’t possible without substantial time and technical expertise. Also, setting up a dedicated colocation environment is complex and requires detailed planning.
- Upfront Investment
Setting up a dedicated colocation space is expensive and requires significant upfront investment. Server layout design, installation, and configuration, all of those costs have to be covered by the company before they can use the infrastructure. Small businesses might not have the necessary resources to invest upfront.
- The Risk of Underutilization
If the infrastructure is not fully utilized, a big chunk of the expenses will be for things you didn’t use. This can lead to inefficiencies and waste of resources.
- Long-Term Commitment
Dedicated colocation typically involves longer-term contracts. This means that organizations have to commit for longer periods of time, which can limit flexibility in case needs change in the future.
Choosing a Fitting Solution for Your Needs
Selecting the right solution for your organization is a matter of your needs and goals, but your budget is an important factor as well. Smaller businesses that have moderate performance and security requirements but need a cost-effective solution with efficient resource usage: shared colocation is for you. On the other hand, for larger organizations needing high-security, high-performance, compliant, reliable environments with guaranteed resources and complete control, dedicated colocation is the better choice.
If you’re looking for the perfect colocation solution tailor-made to your organization’s specific needs, contact our team at Volico Data Centers.
