- 22 May 2025
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Knowledge HubTM
How much do colocation services cost?
- Date Posted:
- Read time: 2 min read
- Written by: Exa Networks
Colocation is great if you’re looking to reduce the admin burden and capital expenditure of building your own data centre – but you’ll still need to bear the upfront cost of your equipment. So how much do colocation services cost?
In this article we’re going to look at the factors affecting colocation services’ cost, including upfront cost for hardware and any additional charges.
Factors affecting the cost
The main elements that affect the price of colocation services are:
- • Location of the data centre
- • Space
- • Power
- • Bandwidth
Location of the data centre
Where the data centre is situated can play an important factor in the price. If you want to rent space in a major data centre such as Equinix or Telehouse it will come at a premium because they have major peering points with the London Internet Exchange, making it easier for organisations wanting to connect directly to companies like Google and Amazon.
Space
This is literally the amount of space you need in the data centre for your equipment. Often, this will be called rack space and is usually the price you will see on a vendor’s website.
Power
One of the biggest factors that will influence cost is how much power you want and how much power is available. Most providers will charge for the allocation of power, which could also include backup generators, as well as power usage. It’s important to bear in mind that each colocation data centre will offer varying levels of redundancy.
Bandwidth/IP transit
The amount of bandwidth you require and the IP transit will also have a bearing on the price. You will need to consider where your data is being transported to as well as how often, if you require it guaranteed 24/7 then you can expect to pay a premium.
Additional costs
Hardware
When you’re looking at colocation services you need to consider how much it will cost to buy the hardware you need housing in the data centre. This usually isn’t provided by the data centre so you will need to take this into account as it will be a one-off upfront cost and may be pricey. £200 to £200,000.
Interconnecting fibre
Directly connecting to other organisations within a data centre is something that you need to consider when choosing your service. Whilst you may think it is necessary it can also be extremely costly with charges upto £1,500 for a single bit of fibre.
How much does colocation cost?
Now that we’ve given you a breakdown of the factors, we’re sure you’re thinking ‘that’s great but how much will these colocation services cost me?’ The honest answer is, it depends and the difference in pricing is huge, ranging from £2000 to £250,000 annually.
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