Co-location is a good choice for companies that want all the benefits of a large IT department but not the hassle and cost that goes with it. The servers are housed in a data center or ‘datacenter’ that has the optimum environmental conditions for perfect operation, with controlled temperature and humidity.
Normally in this type of hosting is paid by renting space in a’ rack’. A rack is the name or metal cabinet shelf where you can place multiple servers or machines of standard dimensions. This kind of hosting is used by large e-commerce sites or companies using ‘mission-critical applications.
As with most things, Colocation has some disadvantages and advantages. It is usually cheaper than hosting your own dedicated server, but it is more expensive than the basic web hosting service. If of web hosting is all you need, then that is a smart choice. Initial costs for space at a data center and the server itself are not cheap. After these initial outlay you will continue to pay for the bandwidth normally and to maintain job security. This cost will change depending on the amount of bandwidth that has been used. If particularly large volume of data have been transferred in the month, then you might have a fairly large increase in the cost of this month. Of course, this will also work another way when things are quiet.
As prices fluctuate month to month there isn’t the safety net of knowing the exact amount you will be spending. Unlike managed hosting, you also have to pay when your server equipment needs updating.