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Colocating vs renting dedicated servers

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  1. #1
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    Question Colocating vs renting dedicated servers

    Is buying a server and colocating it any cheaper than renting dedicated servers? If you add the cost for colocating and WHM/cPanel license then the cost is almost the same as renting a dedicated server, or more. What are others thoughts on this?
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  2. #2
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    Colocating your own hardware can be cheaper, but it also comes with its own unique set of challenges.

    I would say Colo is only cost effective once you need at least a half rack (typically 21u).
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    I've been so close to pulling the trigger on colo a number of times but at the end of the day leasing is so much simpler and easier to maintain. Even HostGator leased but that might have changed since they got bought out.
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    I would say if it's just a single or a couple of servers I would think leasing.
    Leasing anything has so many advantages, if it has a failure it's not your problem.

    Making the move onto your own hardware is something I would not do until I needed at least a rack and had multiple spare parts for each server and ample staff to visit the data center and make repairs. As Laurence said some very big firms leased for a long time and I expect some still do.

    I'm a big fan of Infrastructure as a Service (IaaS) and how owning equipment is slowly becoming a thing of the past.
    I think in response to your question you have to make the choice of do you want to own hardware or lease in one way or another.
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    Colocation is sometimes cheaper, with renting you don't have to worry about remote hands fees and management cost stuff like that. When you colocate a server there is always hidden fees stuff like that. Usually if you find a nice cheap managed host and colocate with then your looking at $99 for a 1U server which is hella cheaper than renting a dedicated server something depending on the server processor.

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    Pros and cons for both, but colo is cheaper, most of the time. One nice feature of renting a dedicated server is being able to rely upon the provider to handle hardware failures. There's never a good time for hardware malfunction, but typically recovery time is a lot quicker when the server is rented, because the data center should have spare hardware on hand, whereas with colo, you may be in a bind for certain issues.

    Once you have a half-rack to a whole rack, colo becomes exponentially more appealing, as your per-slot pricing reduces, and you're typically better prepared for the aforementioned situations.

    Buying new hardware can be very expensive as a smaller host, though. The data centers are able to leverage their relationships with hardware providers and often pay as much as 50% less than purchasing hardware for a single server. Lots to consider.
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    Colocation is cheaper but you have to use your expensive knowledge.

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