How Colocation Data Centers Have Evolved and Why?

Last updated on September 3rd, 2022

The Colocation data centers have much more than the server warehouses, network connectivity, power, and security. Ofcourse, they have not evolved overnight by a series of years have brought upon a significant change in them. Or maybe the change will not be the right word to say. You can say the Colo data centers have evolved with time, producing advanced modifications. Here is the brighter insight into the evolving fact of them. 

Charter Communications and Comcast together had begun investing in an EdgeConneX. It was the time of the year 2013. The Edge ConneX was a contemporary operator of colocation data center facilities that were typically smaller. At that time of their investment into this operator, Jim Kerrigan noticed that something new and possibly significant had just evolved in his industry.

Out of nowhere, the two largest cable network operators in the United States have joined the Akamai. It was the content delivery network and an enormous mass of the market around the globe. The reason behind skipping most analysts’ attention was actually the fairly well-reported investment at that time. The TV viewers were hopping on to the cloud-based recording. 

They were replacing their TiVo boxes with the cloud DVR. The essential factor was the delivery of speed. Though the big cloud services were incorporating the satisfied capacity, still the expected speed was missing.

To acquire the speed goal and give the television viewers faster response times, the competitors desired to collab, establishing the market partner relationship to create a more definite delivery channel. It was when the edge-computing manifested and became a reality. Kerrigan helped Comcast to roll out 22 US ranges for sustaining cloud DVR. They all were the colocation data centeres that served the edge-computing goals. Kerrigan is one of the leading data center real estate brokers in the United States. He is currently directing his own practice. 

You definitely would want to know in a little more depth how the data centers have evolved over years and how cloud had changed the game inbetween, let us give you the highlights on that too in the following sections.

How Data Centers Have Evolved in Years

Change has been the only consistent factor in everything. The business environment, IT models, computing market, and other areas have always been evolving and changing all the time. Thus, the data centers also have emerged and modified according to the IT market requirements. From just being a space filled with systems to host client’s computers, they have brought about many more things into such locations throughout their evolving journey. Let us get down into the memory alley to comprehend and know their evolution from the past years. 

The early 1990s:

They were the years of big spaces incorporating computers when the computer bugs were literally the big machines’ live bugs.


With the advancement in Internet technology along with client-server computing, the data centers got the boom and reputation in the business industry. Many big data center companies got attention amongst the IT industries. 


This period of the twenty-first century had seen all the principal developments in technology. The demands of data center services shoot up, shared hosting came into the way, managed services had great demand, ISP’s, ASP’s and many such technologies found their fast way into the industry. In major cities, to exchange the essential information, the data centers meant a central source for the networking. And, in around 2005, the design of modular and portable data centers introduced its existence. 


In these years, the focus shifted towards enhancing the established technologies. The power efficiency, cooling technologies, and management facilities were what companies start looking for, and that is what raised the competition between the data centers. Because of the environmental concerns, green technologies came up. The efficiency factor was common in every kind of service that the companies desire the most. 

Talking about the current time, it is a bit complex to decide about the pick amongst various data centers. You have a wide range of options to choose from, such as wholesale co-location, setting in public clouds, private clouds, hybrid strategy alternatives, etc. There is no definite comparison amongst them. It will be best for you to analyze which design will suit your requirements, business, applications, and other aspects. 

As you have grasped with the knowledge of data centers’ evolution, the succeeding section explains how the cloud has changed Colocation data centers’ game.

Cloud has Changed the Game for Colocation

The managing principal at Intelligence & Strategic Advisors, Todd Bateman, once conveyed that the expensive sums per kilowatt rates for the services related to data centers are because the hardware are incorporated. The leasing rates were around $900 per 1kW, and the colocation providers charged approx $150. 

That was the scenario before the public cloud approached the market. IT deployments started becoming hybridized. Edge computing has become the conversation amongst enterprises. The choice of deploying informational technology assets in smaller, multiple, and diverse locations hover over people’s minds. If you look and research around you in the ongoing time, you will find all deployments are hybridized effectively. 

Not only the assets but various other objectives have been distributed between the cloud and colocation. You can further observe that things have become complex but not complicated. We all are articulating in three dimensions now in the current era. Everyone is looking to make the best out of whatever they are operating on board. 

New starting points

Over the last five to six years of period, Colocation data centers have considerably become a new industry. Many companies are directing their departure from their on-premises data centers to the colocation services. Most of them are yet to understand the real meaning of “the edge” in data centers’ evolution. Still, they have already been introduced to the multicloud facilities.

Whereas, many big organizations are taking their step back from the cloud, or all-cloud, deployments towards the colocation data centers. That is because of the inability to manage the data volumes under the cloud systems. Further, the unaffordability factor also adds to the reason for moving back to the colocation data centers. The fact that brings up the Colocation data centers challenge is that they are still real estate and property development firms at their roots.

Digital Realty, the world’s second-largest data center colocation provider by revenue, has created various moves to get into more concrete stages in recent years. That displays engagement frameworks, discovery sessions, engineering briefings, and on-site workshops to help clients and corporations comprehend how a global data center stage can thoroughly resolve their edge requirements.

Deeper Engagements

The world’s largest colocation provider, Equinix, has introduced the condition to its sales and consulting teams to bring up the deeper engagements. The condition conveys that they will ask the clients about their requirements and discover the ideas to make clients aware of the rest of the current information. 

Equinix is on track to make out a migration plan that will incorporate studying and analyzing how interconnection may facilitate when the workloads and applications look for distribution at different sites. It will help conclude which workloads and applications will be best at the public cloud and what data can move into the colocation data centers.

If you compare the data center of the early 1990s with the colocation data center industry now, you will know how they confront a different world and a very different market in today’s world.


Having gone through the evolution ride of the colocation data centers, you can examine how the digital economy provides new business growth possibilities. The IT departments are scaling up the operations and ensuring companies the cost-effective solutions. Therefore, for this fact, while considering the site selection matrix, almost all companies, no matter small or big, are looking up to third-party colocation and cloud deployments from the traditional data center infrastructure. This move will enable them to reduce downtime, improve operational proficiency, accelerate enterprise cycles, and secure business continuity. 

Which enterprise would not want such peculiarities? Not a single one!

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Arpit Saini

He is the Director of Cloud Operations at Serverwala Cloud Data Centers Pvt Ltd and also follows a passion to break complex tech topics into practical and easy-to-understand articles. He loves to write about Web Hosting, Software, Virtualization, Cloud Computing, and much more.

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