Colocation: Cost Breakdown

Getting to Know Colocation

In the digital age, sharing and storing information is starting to become a challenge for companies. Most companies want to have access to reliable and cost-effective hosting. Colocation also termed as Colo, is a method of keeping servers and networking equipment in a data center, operated by a third party.

Cost of Colocation Services

The colocation fees depend on the hosting that your business requires. Each data center has a unique pricing policy. Whatever decision you take, consider that hiring a colocation center is usually cheaper than managing your own data center. Businesses can choose from Private, Public or Hybrid Colocation services. The colocation cost will vary according to the services provided. Below is an in-depth breakdown of the positive and negatives of each variation.

When do you need a Private Colocation?

Private colocation can provide businesses with an opportunity to have better economies of scale by high-density equipment. This kind of service will provide you with a dedicated rack space. Your business will usually get all the cooling equipment, very high bandwidth, CCTV monitoring for increased security, backup options and uninterruptible power supply in case of a power failure. The colocation fees will depend on the services provided by the private data center. Private colocation is one of the best services, but the costs are usually higher as compared to public and hybrid colocation. 

Private Cloud Summary

  • Positives: Highly secure, tailored to your compliance needs, more control, and more flexibility.
  • Negatives: Can be more expensive to manage.
  • Cost: $500 – $3000 per month (including hidden fees)

How about a Virtual Colocation and How Much Does it Cost?

When your business aims to reduce your capital expenditures while searching for a reliable colocation service provider with access to the in-house technical ability to organize your virtual resources. If these points cover your needs, then you should select a Virtual colocation service that allows you to deploy your virtual servers. The data center can allocate different resources for you using a secure virtual private network.

Hybrid Cloud Summary

  • Positives: Highly secure, scalable, and cost-effective.
  • Negatives: Can be difficult to manage.
  • Cost: $500-$1500 per month (including hidden fees)

Public Colocation Service and its Cost

Public Colocation is a recommended method for companies to resolve their storage problems. Instead of keeping large, expensive servers in-house that require a complete staff for operations. Companies are now focusing to co-locate their privately owned servers to data centers by renting out their space at a colocation site. In this type of service, the clients do not need to manage their data and equipment. The management of the data center is responsible for maintenance and management of data. The colocation Colorado fees depend on the subscription and service type you choose.

Public Cloud Summary

  • Positives: Public cloud deployments are inexpensive, scalable, and quick to deploy.
  • Negatives: Not as secure, at times not compliant, can be difficult to manage.
  • Cost: $500-$1000 per month (including hidden fees)

Colocation Wrap Up

Overall some organizations don’t want the hassle, others simply don’t have the bandwidth to provide a proper environment for their infrastructure or staff to support it. Breaking down all of the elements in play with a proper solution for your business, the price ranges listed above are what you can expect to include in your IT expenses.

To learn more about Colocation Services see our Data Center Direct Connect services.

THE COST OF DOWNTIME: HOW TO MINIMIZE SERVICE DISRUPTIONS

Downtime. It’s something a business owner can’t quite appreciate until they’ve experienced data loss or an outage. So, like many business owners, it’s not a priority until sh*t hits the metaphorical fan and outright IT crises is in full effect.

Often, the deciding factor in any business decision, including the decision to purchase a data backup service, extends to how downtime can affect the businesses bottom line, universally known as money. Ultimately this places you, the MSP (Managed Service Provider) or an IT department employee, in between a rock and a hard place. Regardless, you’re responsible for minimizing service disruptions and unplanned downtime.

It’s Math Time

Because money is the name of the game, speaking in lost profitability terms is your key to successfully introducing a data loss and backup recovery plan. In other words, you need to do some math.

There are four questions you should be able to answer off hand. These are:

1. What is the gross income of the business?

Several factors can contribute to calculating downtime. To come up with this figure, you need to understand your company uptime.

With the help of a few accounting members from the A/R department, you can determine the annual gross income of the business and work backward from there. Annual gross income divided by the total hours in a year (8760) will give you the lost revenue information to use in the formula below.

Lost Revenue = Annual gross income/Total hours in a year

2. How productive are the employees during an outage?

To determine lost productivity, you need to have the company’s fixed costs on hand. Because the formula below relates to employee productivity, the fixed costs you need to be aware of are employee salaries. During downtime, most employees are working at 50 percent capacity. Therefore, you can assume that the total employee salary divided in half is the lost productivity amount.

Lost Productivity = Combined Employee Salaries / 50%

3. What are the costs associated with restoring your system?

To get the business back to operating normal again, adding up the cost of the services and tools required to keep it running will provide you with the recovery cost estimation.

Recovery Costs = Labor + Restoration Services

4. What are your businesses intangible costs?

Intangibles can be tricky. To forecast this amount you can refer to an estimated number of sales lost due to damage. To get this number, you take your annual revenue divided by the number of sales per year and multiply that by the opportunity loss. Here’s a quick formula for help:

Cost of intangibles = (Annual revenue/annual sales) x estimated number of sales lost

Once you have all of the numbers in place, the formula below will help you calculate the final cost of downtime.

Cost of Downtime (per hour) = Lost Revenue + Lost Productivity + Cost to recover + Cost of intangibles

Through The Looking Glass

Today, on average, an hour of downtime for a small business averages around $8,000 – $10,000. But that’s just taking a microscope to a small businesses loss. For a medium to large corporation, the numbers dramatically increase into the six-figure mark.

To protect your business from data loss and downtime, map out a business disaster recovery plan then select the most appropriate backup solution that fulfills your needs and the needs of your customers.

Compromised Data: Important Backup Service Inclusions

It’s no secret – businesses are prime targets for ransomware.

All it takes is one infected user to bring a department or entire organization to a halt. In fact, 72% of ransomware victims are unable to retrieve or access their data once it has been compromised for up to 2-days. Moreover, a lot can happen in two days.

Here’s the down low on compromised data…

How Infections Happen

Phishing attacks, unpatched programs, compromised websites, poisoned online advertising and free software downloads are common ways that users of your business systems are exploited and how an infection begins.

Examples of User Infections

Ransomware is hard to detect. Because user files are encrypted with the infection, an IT Admin may not recognize that the malware is already inside the network until the damage is done. There are, however, a few ways a user can detect it. Some examples of these are:

  • A user can no longer open normal files
  • A user gets errors such as the file is corrupted or has the wrong extension
  • Window pop ups appear to ransomware programs that the user cannot close
  • IT admins see files in the company directory with names like ‘HOW TO DECRYPT FILES.TXT’ or ‘DECRYPT_INSTRUCTIONS.HTML.’

Business Repercussions

Aside from losing time and money, your business reputation is scrutinized. Which, in turn, can affect sales goals. Regarding data – once your server is infected your mission-critical files and applications become inaccessible and your customer’s data is no longer secure. This too can wreak havoc on your margins.

Compromised Data Solutions

IT admins can remove the machine from the network and reset the bios time to contain and eliminate the malware. For a company wide containment, especially when your anti-virus, firewall, and employee education programs fail, your best bet is to rely on a backup solution.

Not all businesses are built the same. Therefore a backup service should provide much more than just a simple file backup solution. However, there is a range of standard options that your IT staff should become familiar with when considering a backup service. Because backup services are a dime a dozen, we’ve come up with a list of items to be aware of during your review of backup providers.

Important Backup Service Inclusions To Consider Are:

  1. Limited versus Unlimited History

It is important to know the difference. A backup service that only retains a limited history may not be able to restore all of the critical files your business needs to clean up the infection. A proper enterprise-grade cloud backup service should maintain a complete history of your data, that way you can retrieve a recovery point that is reliable.

  1. Detection Ability

Some Cloud Backup Services include Anomaly Detection that alerts your IT admin when the number of “new” or “changed” files increase dramatically. This feature is important to have so you can quickly isolate a ransomware infection and recover data before the entire network is frozen.

  1. Backup Protection Coverage

An infection is not limited to just one device. To protect all of your data and all your devices from mobile phones to Exchange Servers, you should select a program that offers backup services from device-to-device.

  1. Compatibility

Not all cloud backup services are created equal. In fact, many of them have limitations. Some services do not allow file sharing or storage. So, before you pull the trigger on a service you selected, make sure your IT staff does a system compatibility check to avoid any “ooppss” moments after you have signed the contract.

  1. Fees

Some backup service plans include retrieval fees per GB. Most of the time, the service provider will maintain an uptime of nearly 100 percent; however, as part of their service agreement, you can receive credit for those occasions when you get less than 99.9 percent. Be sure to keep an eye on any notifications about interruptions.

  1. Accessibility

Accessibility is important. Being able to manage all of your settings quickly and easily provides flexibility. Most service providers offer a web browser interface giving you the ability to view alerts, load balancing, status checks, manage groups and tags, deploy app versions, view configuration details as well as events. Be sure to inquire about what monitoring systems are available.

To protect your company from data corruption invest in a cloud backup service that is scalable based on your businesses requirements.