As more UK companies go digital, many are missing critical cost factors when choosing colocation data centres, with location, power bills and regulatory compliance proving far more expensive than many anticipate.
With insights from Pulsant, a digital edge infrastructure provider, we take a look at true cost of colocation.
What It Really Costs
There are many costs to factor in beyond the renting rack space. Power and cooling can significantly impact the overall expenses, whilst bandwidth charges vary wildly depending on usage. Then there’s the migration costs, cabling work and support contracts. These are costs that often blindside companies without proper planning.
Rental models need to be considered carefully too. Whether you opt for charged per rack, per kilowatt or per square foot, each carries different implications for your business’s bottom line. Getting this wrong means you could run into budget issues down the line.
Why Location Matters
The location of a data centre makes a real difference to price. For example, facilities in Milton Keynes or Newcastle charge more because property and running costs are higher. But you get better connectivity, more reliable power and you’re closer to major business hubs.
Go for a cheaper site in a remote area and rental costs drop, but so might connection quality and service levels, which can hurt performance.
The Compliance Premium
For healthcare and finance firms, regulatory demands add another layer of expense. Stricter security rules, encryption requirements and privacy obligations aren’t optional, they’re the price of staying legal and protecting data.
Other sectors get off lighter, with more freedom to shop around for cheaper options and potentially better returns.
Building Your Own vs Renting
Companies comparing colocation to running their own data centres face a straightforward trade-off: control versus cash.
By owning your facility, you control everything, but you’re looking at big upfront spending on servers, kit, cooling systems and backup power. Then there’s the ongoing costs: maintenance, upgrades, energy bills and paying people who know what they’re doing.
Colocation sidesteps the capital hit of putting all the infrastructure in place yourself. You pay a monthly rental fee and get access to professional grade facilities, backup power, tight security and fast connections.
Cutting Costs Without Cutting Corners
There are ways to keep colocation costs down. By planning capacity properly, you can avoid paying for space you don’t need. Energy-efficient kit and virtualisation can help cut power bills too. Regular audits spot can also prevent you from wasting money on underused servers or inefficient cooling.
But the big one is scalability. Fast-growing firms need providers who can expand capacity without forcing expensive migrations or major hardware purchases.
Do Your Homework to Avoid Expensive Mistakes
Colocation beats building your own facility and often costs less than unpredictable cloud bills. But before making the decision it’s important to do your homework, factoring in total costs, growth plans and sector specific requirements.