Rack Colocation vs Cloud Connectivity – What’s Best for Your Business?

Rack Colocation vs Cloud Connectivity – What’s Best for Your Business? 

Digital transformation is quickly becoming a priority for businesses across all sectors, but the rapidly growing and diversifying telecom industry can make it difficult to agree on a strategy. Should you hire an in-house IT department or go through a Managed Service Provider (MSP)? Should you invest in fibre optic connections or stick with copper cables? Is a colocation provider the best solution, or should we go through the cloud? 

The good news is a lot of the time these considerations aren’t mutually exclusive, and each product offers a variety of benefits. The real question you should bask is: What are my objectives, and how can I best serve my customers?  

Let’s compare colocation and cloud connectivity to help you decide which service will work best for your team.  



Colocation is an IT service that enables businesses to lease power and space in a physical location called a data center. Data centers are purpose-built to efficiently store and connect IT infrastructure for many different companies. Colocation is a service provided by the data center where they host your IT hardware (like servers) outside your place of business to enable greater security and efficiency.    


Cloud Connectivity 

Cloud connectivity refers to applications or software that can be accessed through the internet instead of physically through a computer or hard drive. The cloud can be accessed by any device with an internet connection, facilitating real-time collaboration and enabling workers to access files outside the office. 




Colocation is a highly secure, efficient and scalable way to manage company data.  

Data centers employ state-of-the-art security measures to protect your equipment from physical and cyber-attacks. These include robust backup systems, video surveillance and fire detection tools to keep your information safe from damage.  

Colocation providers can connect to multiple internet providers for robust, low-latency connections. They offer fully redundant network connections to ensure that your business operations always run smoothly and without interruption.  

Finally, colocation enables your business to expand its bandwidth as it grows without purchasing additional equipment. If your business grows, your colocation provider can offer you the new infrastructure to support you quickly and with less investment from your team.  



Digital infrastructure and software require frequent and usually expensive upgrades to function efficiently, in addition to routine maintenance from third-party professionals. When businesses transition to the cloud, these expenses fall to the cloud service provider – saving the customer time and money on maintenance and enabling them to focus on their core business.   

Growing businesses can quickly increase storage capacity with the cloud to support larger workloads, more data and more users. Cloud service providers can manage your expansion end-to-end to ensure the process is as quick and seamless as possible.  

Additionally, migrating to the cloud can improve IT performance and end-user experience. Applications and software hosted by the cloud can be easily scaled to reach more users. Businesses expanding to new locations can establish multiple Points of Presence (PoPs) globally to ensure that all customers enjoy the same experience and speed, regardless of location.   




Colocation requires that businesses provide their own servers and infrastructure to store in the data center, which may cost more than migrating to the public cloud but is more secure, as your company has complete control over your digital architecture. Selecting a colocation center far from your office could also be costly if your in-house engineers or IT department need to travel to visit the site for routine maintenance. 



Most cloud providers offer rigorous security measures to protect your data; however, they can still fall victim to hacks, data loss and theft. Also, partnering with a cloud provider means they have complete control and oversight over your infrastructure. This can be a source of relief for many companies, but it’s important to remember that you won’t have access to several administrative tasks.  



To summarise, both colocation and the cloud offer businesses a flexible, efficient and scalable way to store their data. Partnering with a third-party provider enables you to host your IT infrastructure in a secure environment with professional temperature and power controls, ensuring your equipment is safe and functions reliably. Both solutions can offer cost savings for businesses when compared with hosting equipment on-premises and can help your organization provide better service to your customers.  

While the cloud is popular across many sectors, it has drawbacks in terms of privacy. On the other hand, colocation is a great service for businesses in metropolitan areas but can be less accessible for those without a data center nearby. Ultimately, these factors need to be considered through the lens of your operational objectives and goals to pursue the right solution for your business.   


Procure with Cloudscene    

Cloudscene is a free digital procurement platform that helps network buyers search, find and connect with telecom providers. Businesses can use Cloudscene to find network solutions such as rack colocation, cloud connectivity, cybersecurity, ethernet, dark fibre, wavelength, IP transit and internet access. 

Simply outline your requirements, time frames and budgets so that we can connect you with a provider that meets your specific needs. Explore our directory to find a colocation or cloud provider that’s right for your business, or get in touch with our friendly team to learn more about the platform.