As your business expands, your existing IT resources become increasingly insufficient to run your operations smoothly. This can lead to significant challenges, including system downtime, slow processing speeds, and reduced productivity. Businesses need to provide additional capacity to meet their growing IT demands so that they can mitigate these challenges.

One key decision businesses face when expanding their IT infrastructure is whether to build a data center or lease a space in a colocation facility. It is a crucial decision that can significantly impact your business’s long-term success. In this article, we’ll explore the pros and cons of both options to help you determine which the better option for your business is.

Building

Building a data center gives a company complete control over its infrastructure. It allows companies to customize their data center to meet their needs and requirements. Building a data center also allows companies to scale their infrastructure as their business grows.

However, building a data center is a time-consuming and expensive process. It requires a significant upfront investment, and the ongoing costs associated with maintaining and upgrading the infrastructure can be high. Additionally, building a data center requires data center design, construction, and management expertise. Companies must also consider factors such as power and cooling requirements, security, and compliance with industry standards and regulations.

Building a data center can also lead to a waste of resources as it is almost impossible to predict the exact amount of IT resources a business will need in the future. It is often challenging to keep adding more resources to your on-premises data center. Thus, companies often build more resources than they currently need in expectation of future growth. However, these additional resources remain unutilized, eating up the profit.

Leasing

Leasing a data center provides companies with access to infrastructure without the significant upfront costs associated with building a data center. It also allows companies to avoid the ongoing costs of maintaining and upgrading the infrastructure. Additionally, colocation data centers have a team of experts responsible for managing and maintaining the infrastructure. Leasing space in a colocation data center allows companies access to their expertise. 

Colocation also provides companies with the flexibility to scale their infrastructure as needed. Most data center providers offer a range of service options, including different levels of support, bandwidth, and others.

Additionally, colocation centers implement the required security measures to protect your IT infrastructure from cyber-attacks and physical harm. Creating such a robust security system for an on-premises data center is often not a financially viable option, especially for small and medium-sized businesses.   

While offering all these benefits, leasing a colocation center also means giving up some control over the infrastructure. When you rent a data center, you must rely on the colocation provider to manage and maintain the infrastructure and may have limited options for customization.

Build vs. Lease Data Center: Which Is the Better Option?

Whether to build or lease a data center depends on a company’s specific needs and requirements. Building a data center is the better option for companies that require complete control over their infrastructure, have particular customization needs, and can afford the upfront and ongoing costs associated with building and maintaining a data center.

On the other hand, the companies that require flexibility and scalability, have limited resources or expertise in managing a data center, and want to avoid the upfront and recurring high cost of building and maintaining a data center should go for colocation. 

Generally, leasing a data center is more convenient for most companies. If you need significant customization, ask your colocation service provider the relevant questions and explain your needs. In most cases, they will be able to accommodate your customization requests. However, if you need complete control over your IT environment, you have no other option but to build your own on-premises data center.   

At Coloco, all your needs will be taken care of!