March 27, 2023

What is colocation and do enterprises need it?

Colocation refers to the practice of housing a company's servers and other computing equipment in a data centre facility. In today's digital age of big data, where enterprises are generating and storing vast amounts of information, colocation has become an essential business service.

Enterprises looking to ensure that their critical IT infrastructure remains secure, reliable and scalable should use colocation to keep costs down. By using a colocation facility, companies can avoid the significant expenses associated with building and maintaining their own data centres. They benefit from access to advanced technologies, robust connectivity options and round-the-clock support from trained professionals.

What is colocation?

Colocation is a type of data centre facility where multiple customers can rent space for their servers, storage and networking equipment. Colocation facilities provide power, cooling, connectivity and physical security. Service providers are responsible for the cost of maintaining and operating these data centres. Given South Africa’s electricity crisis, choosing a data centre that is not affected by loadshedding has become increasingly more important for enterprises. Teraco, for example, offers excellent power redundancy that is supported by multiple generators and solar energy.

While colocation and data centres are related concepts, they are not the same thing. A data centre is a facility that houses a large number of servers and other computing equipment, typically belonging to a single organisation or company. Data centres are often used to support mission-critical applications and services that require high availability, scalability and security.

On the other hand, colocation refers to the practice of renting space in a data centre facility to house a company's own servers and computing equipment. Essentially, colocation is a way for a company to outsource the physical infrastructure required to run their IT operations while still retaining control over their servers and data.

Both data centres and colocation facilities are used to house servers and other computing equipment, but the main difference between them is ownership. In a data centre, the equipment is owned and operated by a single organisation, while in a colocation facility, multiple companies share the same physical infrastructure.

Which types of enterprises need colocation?

Colocation can benefit a wide range of enterprises across various industries. For the most part, any enterprise that relies on IT infrastructure to run their business can benefit from these services. Colocation can provide these organisations with access to enterprise-grade infrastructure without the high upfront costs.

In particular, colocation is well-suited to enterprises in e-commerce and financial services. E-commerce requires high-performance, reliable and scalable infrastructure to support online sales platforms. Similarly, enterprises offering financial services rely on the availability and security of their IT systems to conduct transactions, manage risk and comply with regulatory requirements. For both these types of enterprise, colocation can provide the necessary infrastructure to meet demanding networking and security requirements.

Similar to financial services, healthcare providers need to ensure confidentiality and data integrity for their customers. Colocation can offer these providers with a secure and compliant environment to host their electronic health records and other sensitive data.

While data security is essential for those processing highly sensitive customer data, it is also critical for the success of any digital-enabled business. A data breach can be highly damaging to a company’s reputation, ultimately affecting the customer and other end users. .

Another data-intensive industry is gaming and online entertainment. Online streaming requires low latency and high-bandwidth connectivity to provide a seamless user experience. Colocation can provide these companies with access to high-speed network connections and low-latency routes to end-users.

Colocation in South Africa

There are a number of colocation facilities in South Africa, mainly located in or around major metropoli; Johannesburg, Midrand, Cape Town, Port Elizabeth and Durban. Energy is a significant issue for colocation centres, pushing providers to increase the use of green energy sources.

Colocation facilities in South Africa, like in other parts of the world, vary in their energy efficiency and use of sustainable resources. Some colocation providers in South Africa have implemented green initiatives to reduce their carbon footprint and minimise energy consumption.

SEACOM provides colocation services to South African enterprises. Our facilities are purpose built in line with global standards and best practices. We ensure high availability power and cooling to ensure optimal performance at all times. Our services deliver highly efficient connectivity and traffic flow, with flexible options and open-access. For more information or to get a quote for colocation, email us at marketing@seacom.com or leave us a message.


SEACOM operates Africa’s most extensive network of information and communications technology (ICT) infrastructure, including multiple subsea cables and secure internet connections tracing both sides of the continent. This is partnered with broad terrestrial fibre networks in Southern and East Africa, extending services to these regions.

Today, SEACOM provides holistic ICT solutions covering connectivity, cyber security, cloud, smart networking and communication products that provide African businesses with the necessary building blocks to deliver world-class solutions to their clients. We are privately owned and operated, making us agile and adaptable to the needs of our customers.

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