What’s the difference between cloud computing and colocation?

What's the difference between cloud computing and colocation? My company, Lifeline Data Centers, is often asked this question. And whether its a Google search or a conversation at a cocktail party, we're hearing the question more frequently.

Here's a simple version:

  • Cloud computing is a fancy name for software and/or hardware that is available via the Internet.
  • Colocation is high-tech real estate, or outsourced data center space, where you can operate your company-owned software and hardware.

Here's another way to look at it:

  • Picture cloud computing as a highly reliable (99.995% uptime) computer room full of network equipment, servers, disk storage, software and connectivity, all ready to use for a monthly fee.
  • Picture colocation as an highly reliable computer room that's empty, waiting for your network equipment, hardware, disk storage, software and connectivity to complete the picture.

Both approaches have value. Smaller companies and startup companies may prefer a cloud computing model because it does not require much internal Information Technology expertise to operate. Startup costs can be low with cloud computing, and the barriers to entry are usually small.

Larger companies and companies with strong Information Technology departments often choose colocation, also known as wholesale colocation or wholesale data centers, to house their computer rooms. These companies value colocation's flexibility for growth and change. Data center capital costs are enormous, and building your own no longer makes sense for many companies that need high levels of reliability. Many cloud computing data centers are housed in wholesale colocation facilities, because the cloud services vendors appreciate the control and cost management benefits of wholesale colocation.

It is also very common for companies to have both internal data center space and cloud computing services. Many companies use software-as-a-service(SaaS) such as Salesforce.com, LinkedIn.com, and ConstantContact.com in addition to having hardware and software of their own.

Both approaches can solve problems like data center compliance and certification requirements, which are expensive and difficult to maintain. SAS 70 data centers, SSAE 16 data centers, TIA 942 certifications and required by many clients and vendors as a condition for doing business. Wholesale colocation and cloud computing services can meet these compliance requirements with little or no extra work from the client company.

Which solution is right for you? For more information, give us a call at 317.423.2591.

Alex Carroll

Alex Carroll

Managing Member at Lifeline Data Centers
Alex, co-owner, is responsible for all real estate, construction and mission critical facilities: hardened buildings, power systems, cooling systems, fire suppression, and environmentals. Alex also manages relationships with the telecommunications providers and has an extensive background in IT infrastructure support, database administration and software design and development. Alex architected Lifeline’s proprietary GRCA system and is hands-on every day in the data center.
Alex Carroll