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Considering Colocation? From One IT Executive to Another

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September 25, 2014
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In the nearly 15 years Peak 10 has been a colocation services provider we’ve pretty much seen it all, including the rapid evolution of cloud computing and our own services extension into clouds of many types. However, colocation continues to be core to our business model.

CIOs and businesses decide to collocate for many reasons, including for  simple things like HQ relocation. The challenge of finding and retaining reliable vendors and/or in-house staff is a growing concern. Issues with availability or regulatory compliance can drive CIOs in search of a more robust infrastructure. The cost per square foot of a data center refresh is daunting, and swapping CAPEX for predictable monthly OPEX can be compelling. We’ve even seen companies buy their first big SAN, only to discover they couldn’t power it up because of inadequate energy. Mid-size and smaller organizations typically have more trouble keeping up in these regards than do large enterprises with several big data centers.

Whatever the reason, deciding to place your trust in a third-party to host your servers can be nerve-wracking, like sending your only child off to boarding school for the first time. At least your son or daughter returns on holidays and in the summer. Colocation, on the other hand, is a mid- to long-term decision (even though you may visit frequently). Changing providers in mid-stream is very disruptive to business, and can be to careers as well.

So, getting it right the first time is very important. Getting it right means not only the physical space but the people to whom you are entrusting your business growth engine, i.e. your servers. The less attention you pay to the human side of the equation in your selection process, the more it will return to haunt you later.

We’re “CIO by committee” at Peak 10. I share the role with Jeff Biggs, EVP of technology and operations. I’m responsible for the automation, tools and processes side of things. By having this role at a provider of datacenter and cloud services, I see matters from both sides and can easily empathize with CIOs challenged with selecting the best colocation provider to support their business. I hope the following recommendations provide some useful guidance.

What’s the track record? Steer clear of start-ups and companies with colocation as a sideline unless you want them triaging their business on your nickel. You want to mitigate your issues, not take on someone else’s. Customer references should include businesses similar to your own in terms of size and budget.

Where is it located? Proximity used to mean down the hall. Now you’re about to run IT operations remotely; how remotely is the question. Many factors can go into determining just how far is too far. Staying local does keep costs down in terms of travelling to and from the colocation facility to implement changes or do maintenance. Farther away may be preferable if placing your systems out of harm’s way (weather, geography, personal safety, crime) is a concern. There often are tradeoffs that must be made. Also be cognizant of the utilities and communication services the provider relies on to deliver infrastructure; they should be reliable, plentiful and redundant.

Is there regulatory compliance? For some business, complying with industry or government-mandated regulations is a critical concern. While you can’t offload responsibility for compliance to a provider, the provider can make it easier for you to achieve compliance. Accordingly, the provider must undergo independent annual compliance assessments to ensure its infrastructure meets or surpasses the rules and regulations for PCI, HIPAA, SSAE 16 and/or any number of other guidelines for data security and protection, as well as operational integrity. This is important to about 25 percent of Peak 10’s colocation customers. Regardless of whether it’s of direct importance to you or not, placing your trust in a provider that takes security and compliance seriously is to your advantage.

Is the provider proactive? Make no mistake, you are entering into a business partnership with your colocation provider. Like many partnerships, they can be good or bad or mostly one-sided. Some providers limit interaction to Web access or the telephone. The best ones invite interaction, want to know about your business, answer questions willingly and ask questions frequently. They are willing to step in in a pinch to help resolve an equipment issue. Their staff is highly skilled, accessible and view themselves as an extension of your own IT team.

What else can they do? Earlier I noted that you should view colocation as a longer term commitment. As you become more at ease with your provider and adept at getting the most value from the relationship, and as your requirements change and grow, you’d do well to have a provider that can accommodate your needs. Many who began as Peak 10 colocation customers gradually added more services – patch management, managed hosting or disaster recovery, for example. While not a requirement certainly, it is satisfying to know extended services are available when you need them.

Peak 10 has a great deal of information and planning guides about colocation on our Web site.

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About Peak 10

"Our values are the foundation for everything we do at Peak 10, and are ultimately what enable us to earn our customers' business and their trust."
David H. Jones,
Board Member, Peak 10 + ViaWest