10 Keys to Choosing a Data Center Colocation Provider

9 minute read
Choosing a Colocation Provider

Editor's Note: Sirius and Forsythe are now one company. Sirius acquired Forsythe in October 2017 and we are pleased to share their exceptional thought leadership with you.


In the 1990s, Friends was huge on TV, mainframe ruled in IT and the majority of today’s data centers were born.

Since the average U.S. data center is 18 years old, many enterprises are relying on infrastructure that was built when 16 MB RAM was considered to be a lot of storage and smart devices were the stuff of science fiction. These aging facilities were designed in a different compute era, are no longer efficient and require perpetual cash to maintain.

Most enterprises now have a hybrid data center model — a mix of legacy, private cloud and public cloud infrastructures. Owning a data center, even a small one, is like owning a home — you have to pay for everything and keep up with all the repairs. If you cut corners and fail to upgrade your equipment when necessary, you may put your enterprise at risk.

For these reasons, many enterprises are choosing to house their data in a colocation facility.

A colocation model offers the following benefits:

  • Owning and operating a data center is not a core competency for most businesses. When you choose the colocation model, you can focus on supporting your business and customers — not supporting the data center.

  • Colocation and its related services offer flexibility, so you can scale your IT environment to align with the business over the contract duration.  Companies are no longer viewing colocation services as just space, power and cooling but seeking a vendor that can provide a data center solution.

  • You need to heighten your physical security to meet third-party audits. Many security audits are becoming standard and no longer just apply to healthcare and financial organizations. To pass these audits, you may need to increase the physical security and access around your data center. Colocation facilities often have much better physical security than private-owned facilities.

What should you do before you search for a colocation provider?

It costs a lot to pick a provider, move in and become operational. If you make the wrong choice, the costs of moving out later will be much higher than the costs of moving in.

Before you sign a contract with a provider, you must begin with the end in mind.

Here are some questions that will help you determine your colocation requirements:

  • What do you want to achieve? Understand not only your day-one requirements, but also what you want to achieve in the future (e.g. transitioning to the cloud, going to a high-density environment, using managed services, etc.).

  • What are your business and IT requirements? For example, determine if you need to replicate and/or archive your data. Do you need additional colocation data center locations for replication and data archiving?

  • What does your growth plan look like? Your colocation provider should help you scale in space and power, so you can move in different directions in the future.

10 things to look for in a colocation data center

The average colocation contract is three to five years, while a wholesale colocation contract ranges between five and 15 years. Even if you have a short term contract, you don’t want the costs, hassle and potential downtime related to changing data centers every three years. That is why it is vital to choose a provider who not only meets your current needs but who can also meet your future requirements.

Here are 10 things to look for in a data center colocation provider:

1. The power density to support both current and future technologies.

Data center power densities have been steadily increasing due to newer technologies and many clients require up to 10 kW per cabinet. However, not many colocation providers offer the power densities to support future technologies. A majority of colocation data centers were constructed prior to the density "boom" and can only support an average of 4 kW per cabinet. In order to support high-density environments vendors will distribute the load over a larger footprint or have to implement a supplemental cooling system. Both of these approaches address the power density issue, but increase the cost of the contract.

2. Flexible master service agreement (MSA) and service level agreements (SLAs).

Contracts are written to protect the provider. Be proactive in addressing contractual and SLA items that are critical to the business. Initial discussions will provide insight to vendors that are willing to include or revise verbiage to better protect the client. One crucial mistake we see is waiting until the selection of the vendor to address contractual or SLA concerns instead of including them within the search criteria.

3. Network carrier redundancy.

A corporation-owned facility is usually limited to a small number of network carriers that provide telecommunications services. Look for colocation facilities that are carrier neutral and have a variety of network carriers that can provide connectivity within the facility. Various network carrier options will allow for a competitive pricing situation to reduce costs and provide the ability to incorporate a redundant vendor network design. It is also important to understand which providers are "lit" within the building and identify others that can provide services through a connection from a carrier hotel. The carrier hotel will increase the provider options to the client, but will add costs associated with the additional cross-connect. Finally, understand the redundancy associated with the routing to and within the colocation facility.

4. High-density environments.

More floor space doesn’t equal a better data center. If you can be efficient and fit the same amount of equipment in a smaller space, you’ll reduce your operating costs. Forsythe analysis shows non-recurring costs (NRC) can be reduced by approximately $10,000. Monthly recurring costs (MRC) can be reduced by $3,000 for each cabinet consolidated.

5. The right location.

Many companies are transitioning to “lights out” facilities so they can manage everything remotely. Decide how far you want to be from your data center. Does it need to be located far away from natural disasters such as hurricanes and tornadoes? A “lights out” facility is the most risk-adverse and cost-effective option. However, the farther you are from your data center, the greater your networking costs. Choosing a data center that is close to home makes it easy to respond to issues. For fast disaster recovery, your replication data center should be located no more than 50 to 100 miles from your primary data center.

6. High levels of physical security.

Ideally, you should have multiple levels of physical security both inside and outside the data center. Before you select a colocation provider, ask what perimeter and external areas are covered by camera. Also understand vendor security procedures and if you can add your own security cameras within their space.

7. Alignment with disaster recovery and business continuity plans.

The power, cooling and networking in your replication data center should match — or be better than — what you have in your primary data center. This will help you remain up-and-running during outages. Vendors should also have technical expertise and the capabilities to support clients with the development and testing of a disaster recovery plan. Also look for a data center that has workspace for your technical team to use for disaster recovery testing and declarations. Many providers don’t have this feature or they sell the workspace to multiple clients and hope that they do not declare a disaster at once.

8. Compliance.

When it comes to compliance, many colocation providers say they offer certain Tier availability and may look like Uptime-certified data centers but they aren’t really. Be wary of false claims and verify your provider’s certification with the Uptime Institute. Also, clients should verify that colocation facility is SSAE 16 compliant and that the provider will support 3rd party audits at no additional cost.

9. Transitional services.

At a minimum, your provider should offer a comprehensive managed service portfolio, so you won’t need to dispatch your technical staff to flip a switch. Also, it is critical that your provider can evolve along with your IT and business objectives over the duration of the contract. Taking advantage of managed services will free up your team’s time to support business objectives while ensuring that your infrastructure operates smoothly.

10. Future growth.

With technology changing so rapidly, it is impossible to know where you will be in three, five or 10 years. Look for a colocation provider who allows you to expand in areas such as power and space. If you’re considering additional services, ask if your colocation provider will let you modify your master service agreement as your business changes.

7 keys to a smooth RFP process

Reviewing requests for proposals (RFPs) from potential colocation providers can be a daunting task. Here are seven tips that will help you sort through the hype and select the best option:

1. Get your data center requirements straight or you won’t get a straight answer from colocation providers.

If you don’t at least know your space and power requirements, you may not know what additional requirement questions to ask in the RFP.

2. Once you understand your colocation requirements, send an RFP to six to eight providers in your ideal locations.

The RFP should be designed so you can easily compare providers who are within and outside of your ideal locations.

3. Ask tough questions.

It can help you really find out each colocation provider’s strengths and weaknesses.

4. Get as much information as possible from vendors.

For example, ask about their SLAs, MSA, environments, cost models, physical security features and managed services options.

5. Understand the vendor’s pricing model.

The data center pricing model has moved from paying per square foot to paying for power. Determine how much power you will get, so you can compare apples to apples.

6. Look at how much detail each vendor provides in your RFP.

If they don’t show interest in the RFP, what will they do once they win the contract?

7. Schedule site visits.

Price should not be the only determining factor when selecting a colocation provider. Site visits are also a major part of the selection process. However, make sure you ask as many relevant questions as possible in the RFP, so you can take your site visit to the next level.

Choose a data center solutions partner not just a colocation facility

The physical characteristics of the colocation facility are just the start. How the colocation facility is operated, how long-term clients are treated and what kind of flexibility the facility has on space, power and cooling for clients to grow is important to understand. Find out what additional services are available. All of these factors are critical to whether your experience with the colocation provider will be a success.

Moving to a colocation facility can help you cut your CAPEX while gaining access to the latest data center technologies. You can also quickly evolve by taking advantage of managed services, greater power density and the hybrid cloud. It is important to select a colocation provider that is your partner and who can help you scale your IT over time.

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