Wholesale Data Centers Versus Colocation Services in 2020 

Wholesale Data Centers Versus Colocation Services in 2020 

Forward-thinking companies understand the importance of their IT infrastructure, especially in today’s digital economy. Leveraging data and digital assets offer companies both a competitive edge and an opportunity to optimize business performance. This is especially true as performance relates to the speed of information, and the necessity of cloud and internet connectivity in the current digital landscape.  Each of these activities are supported by a data center environment.

Data Centers offer both Wholesale and Colocation solutions. 

Simply put, data centers are the location where computing facilities and networking equipment are centralized.  Companies can choose to rent the space and power required for their IT infrastructure at a data center through either a colocation or a wholesale provider.  When it comes to managing the tremendous demands of high-density data storage and properly maintaining IT infrastructure, data centers are indispensable for businesses. Because of the different business computing applications, it is essential to choose the right type of data center to fit your requirements.

Wholesale Data Centers versus Retail Colocation Solutions 

First, let us identify the difference between a wholesale data center and colocation services.  Much has changed in the data center market.  In the past, wholesale offerings were geared to very large enterprises who opted to lease or build their own data center for their space and power needs.  Once the space was constructed, a wholesale tenant was then responsible for handling all IT operations, including managing staff and hardware.  Delivering internet connectivity to the facility required further buildouts such as cross-connects, installing dark fiber routes, and bringing together a diverse set of carriers to the building.

Customers who could not afford the cost of building a data center facility would lease a small footprint within a retail data center where several tenants would run IT services, or “colocate,” from their primary location in a shared computer room space.  Customers were offered an established service menu for internet and network connectivity.   However, in 2020, the definitions which formerly separated retail colocation and wholesale have disappeared, as data center providers offer more hybrid solutions that integrate cloud services to the marketplace.

Defining Wholesale Data Center Solutions in 2020

Compared to an owned data center, where the company is responsible for running the entire facility, wholesale data center and colocation facilities offer large enterprise customers the ability to lease space and power for deployments requiring 1mW or greater.  The main difference, beyond the size of the IT deployment, relates to how power usage is priced; in wholesale data center environments, the power is often metered.  Therefore, if there is a surge one month and traffic slows the next, the customer will pay for the energy consumed.  Wholesale customers often tend to require a great deal of customization. The level of control, certifications, and other regulations needed to meet their specific company requirements means they often  provide their own staff for technical services.

Defining Colocation Services in 2020

Colocation facilities refer to data centers that have been sub-leased by multiple tenants, so the total facility cost and capacity are shared across the lessees.  This is a perfect fit for companies with small to medium IT requirements, as they appreciate greater flexibility in how their digital platform changes over time.  IT installations can be easily adapted by adding another rack or additional bandwidth to the service agreement, with nearly immediate results as the facility manages the technical services remotely.  As a result, tenant customers receive a turnkey solution for their mission-critical IT that often includes:

  • Space
  • Power
  • Internet
  • Network on-ramps
  • Physical security and critical system monitoring,

Colocation customers enjoy an all-inclusive service leased by rack, space within a rack, or a caged off area.

The bottom line is, there is a solution out there for every company and every situation.  Element Critical offers dedicated data center services ensuring the redundant backup of your critical systems, an uninterrupted power supply, environmental controls to support the longevity and optimal function of your equipment, and a secure environment for your IT’s efficient operation stack.

To learn more about our wholesale colocation and colocation data centers in Silicon Valley, Chicago, and Northern Virginia, send us a note at [email protected] or visit us at www.elementcritical.com


Nisa Hunt, Marketing Manager, Element Critical Nisa Hunt | Element Critical | CDCP Certified

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