Mixing colocation and public cloud providers without getting a hangover
A colocation data center (or colo) is a type of data center where equipment space and bandwidth are available for rental to retail customers. They rose up quickly in the last 10 years as businesses looked for more economical ways to host their expanding number of servers. Moreover, many businesses wanted to get out of the business of maintaining their own data center, which was a constant burden and expense.
Colos provide space, power, cooling, and physical security for the server, storage, and networking equipment. This includes high-speed Internet connectivity, or maintaining a dedicated circuit back to the enterprise.
Of course, colo providers are not cloud providers. Enterprises often get them confused, since many colo providers themselves hype their services as cloud services. The fundamental difference is that colo providers offer data center space and infrastructure, whereas public cloud providers offer specific services such as storage, compute, applications, etc..
The problem is that many colo providers see the value of cloud computing hype, and are now positioning themselves as cloud computing providers. Indeed, many of them offer up public cloud-type services, including storage and computing on-demand as part of their offering.
However, most colo providers are not true public clouds. They don’t provide some of the core services, such as self- and auto-provisioning, they don’t provide usage service billing, and they don’t have well-defined APIs that offer access to the cloud resources.
Of course, you know how this goes. We can call anything a cloud, if everything is a cloud. As a cloud computing specialist who’s trying to help enterprises figure all of this out, I have to consider each offering on a case-by-case basis. Generally speaking, most colos don’t provide true public cloud services as we would expect from the larger and more popular public cloud providers.
In many instances, they provide access to public cloud services directly from their colo infrastructure for their customers, such as AWS storage services that are brokered by the colo provider. This is a horse of a different color, and may be a path that colo providers can follow that will increase their market share, at the same time providing their customers with a less invasive way to access public cloud providers using a managed intermediary.
Figure 1 depicts how this configuration typically works. The colo provider (as well as managed services providers) maintains a services catalog that includes all of the native services that the colo provider offers, including storage, networking, and compute services. Also in the services catalog is a list of public cloud services as well, such as the many services offered by AWS, Google, and Microsoft.
Figure 1: Many colocation providers offer gateways to public cloud services. This may be a good option for some enterprises that are moving to the cloud.
Thus, those who employ the colo provider can mix and match their own services that they host within the colo provider, as well as services that the colo provider offers, and then public cloud services that are provisioned and managed from within the colo provider, but ultimately supported remotely by the public cloud provider.
The question emerges: Why leverage a colo provider, or a managed services provider, to access public cloud services when you can access them directly? There are a few reasons:
- The colo provider is able to act as both an intermediary/broker, as well as a services manager. Thus, enterprises that employ colos don’t need to create their own agreements with public cloud providers; they simply provision through the colo, using prearranged agreements that the colo provider made with public cloud providers. This removes some complexity in dealing with public cloud providers.
- In some cases, through economies of scale, the colo provider is able to offer the public cloud services at a discount that the enterprises may not be able to obtain. What’s more, the colo provider can monitor the usage of the public cloud services along with the other services the enterprises consumes, and provide a single bill, and thus a single way to analyze and understand the costs of all services, from on-premise to the cloud.
- The colo provider is able to offer common security, management, and governance services that exist on top of the services within the colo provider or public cloud services. This provides a “single pane of glass” for an enterprise looking to leverage public cloud services, and manage these services with existing legacy systems, using a single management and governance interface.
The typical fit for the colo/cloud model is for small to mid-sized businesses that don’t want to maintain their own data center, and really want others to manage any interaction they require with public cloud providers. The cost justifications are easy to determine, including justifying the use of a colo with cloud that can better accommodate the business as priorities and processes change.
While the case for small to mid-size businesses is easy to make, perhaps there is value for larger enterprises as well. More Global 2000 companies are looking to get out of the data center business, either deferring new construction and leases to leverage colo or managed services providers, or leveraging public clouds where possible, or both.
The value of this model to larger companies is its ability to balance workloads between systems that are hosted on colos, which are functionally on-premise systems, and the use of any number of public cloud services. If the colo manages the provisioning and operations of the public cloud services, then that simplifies the use of services that are owned by the enterprise, and services that are maintained by public cloud providers. Thus, enterprise IT is able to mix and match services to form and reform business solutions, but does so through a managed layer that’s maintained by the colo provider.
The value of this sort of approach remains to be determined, considering that colo and managed services providers are just getting these gateways up and operational. However, enterprises are balking at the use of colos to get to public cloud providers, opting instead to access providers directly. While smaller businesses seem to focus on cost when leveraging the colo/cloud model, larger enterprises to seem to focus on control.
In some instances, this is just the older colo model attempting to ride the cloud computing wave, although there is some value to be gained here, if leveraged correctly. As enterprises continue to move toward outsourcing data center operations to colos and managed services providers, the ability to leverage public clouds using colos could be a good approach for many enterprises.
The long-term viability of this model is still a bit in question. Issues that could arise include dealing with support across multiple providers, as well as responsibilities around security and governance services. The colo provider will have to take the ultimate responsibility for everything, if this model is to provide value to enterprise IT.
The bottom line is that, if you’re in a small to mid-sized company, then this model should be in consideration. Those organizations will most likely find value here. If you’re in a large company, then you need to run the numbers and consider all of the potential issues and advantages.

