Companies frequently grapple with the decision of whether to handle a product or service internally or outsource it to a specialized vendor. This dilemma extends to telephone and computer services, demanding a careful evaluation of the most advantageous approach.

The optimal choice concerning technical services hinges significantly on your specific circumstances at any given moment. It is advisable to reassess these decisions periodically, perhaps annually. While the merits of internally managing your telephone and computer systems might be clear, it’s equally crucial to understand the upsides of outsourcing.

Let’s delve into a particular outsourcing model known as colocation, which shares some similarities with cloud computing. Colocation involves relocating your telephone and/or computing infrastructure to a dedicated facility known as a colocation center or carrier hotel.

Colocation can take various forms. The most common scenario involves physically transferring your data center equipment to a colocation facility, where it is reinstalled, often by your team or the facility’s staff, within a secure, enclosed space inaccessible to other clients.

The rationale behind this approach lies in achieving economies of scale across several domains. For instance, you’ll only realize real estate savings if space is limited or if you’re currently paying a premium per square foot in a high-rent location. Beyond physical space, colocation facilities offer equipment racks, robust power supply, efficient cooling systems, and comprehensive security measures. They provide ample power capacity and HVAC systems to dissipate heat generated by powerful servers and switches. Additionally, they often feature backup systems to mitigate concerns about power failures, which can be particularly beneficial in areas prone to storms or unreliable electricity.

Many organizations opt for colocation centers to gain access to plentiful, cost-effective bandwidth. While “cheap” is relative, bandwidth costs per Mbps at these centers are typically more favorable than what you’d find at your facility. Multiple carriers often converge within the same building, establishing points of presence for their fiber optic networks. This translates into minimal construction expenses, as connecting to a carrier’s network often involves a simple drop from their cage to yours. If bandwidth limitations, lack of fiber options, or exorbitant construction costs are concerns, relocating to a colocation center can effectively address these issues. You can still maintain communication with remote locations using T1 lines or other available bandwidth solutions.

Beyond infrastructure, colocation centers provide round-the-clock staffing—a considerable advantage for smaller companies unable to afford a dedicated 24/7 technical team. Even larger organizations can benefit from having server specialists readily available near their equipment. You retain the option to manage your equipment or delegate upgrades and patching to the center’s personnel.

Furthermore, numerous colocation centers offer equipment rental as an alternative to ownership. This eliminates the need for significant capital expenditures on new servers every few years (or even months) by allowing you to lease fully managed servers dedicated solely to your requirements. This approach can extend to telephone equipment as well. Instead of shouldering the costs and staffing requirements of an on-premises PBX system, you can utilize a remote PBX system procured and maintained by a specialized provider.

These considerations lie at the core of make-or-buy decisions. Increasingly, businesses are discovering the advantages of renting from a large facilities provider over maintaining comparable systems in-house. Could your business potentially benefit from a colocation center? Explore this option by obtaining colocation services prices and availability for comparison with your current costs, enabling you to make a well-informed decision.