colocation is where you buy your own server, with your own hardware and you store it in someone else’s data center. The company that owns the data center will provide you with security, air conditioning, fire protection, and dedicated internet connection because you owned the server that means if the server have hardware malfunction and need to be replaced it is your job to get a replacement for the damaged hardware.
So it is a good idea to have a stock of hardware for your server in case some of the hardware need to be replaced. The hardware can be replaced by yourself if you live near the data center, or you can send the hardware to the data center owner and ask them to replace the hardware although this usually requires you to pay some service fees.
Company and individual choose colocation hosting because they have the complete control over the hardware, they can tailor the hardware exactly based on their preferences. If you have a program that only works for certain combination of hardware, colocation hosting would be a great choice because you buy the hardware by yourself so you are certain that the program will work on the server.
The other advantage of buying your own hardware is that you can be completely sure with the quality of the hardware that you bought, this is something that you cannot know for certain when renting a server.
colocation hosting is for those who wants a complete control over the server hardware configuration, and also for those who need a custom server for a custom made program that requires a special piece of hardware.
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