As with many other products and services, in hosting there is a choice between owning and renting. What is colocation: Colocation is a hosting platform that lets you use a shared datacentre. Businesses that use colocation services own their own equipment.This equipment can either be purchased from a vendor or from the provider of the colocation service and hosted in the colocation provider's facility. The equipment owner takes care of all aspects of managing the server unless a maintenance agreement has been purchased together with the colocation cost. Datacentres providing colocation services provide physical security, fire detection systems and power backup and cooling systems. Dedicated servers Dedicated servers are leased on a monthly or yearly basis. They are owned by the datacentre providers and come pre-loaded with the operating systems of your choice. These servers come with shell access that can be used to configure the server. Once leased, the end user’s third party software, operating systems and data can be loaded onto the server. You also have an option to ugrade to a more powerfull server or ugrade specific resources. Which one should I choose This depends on your long term business goals. Dedicated servers have a low cost of entry but are usually limited by the hardware provided by the datacentre operator. This may be a drawback for specialised operations that require higher than average processing power. Dedicated servers also have higher longer-term overall cost. Therefore this type of model is recommended where you need to rent for a relatively short period of time( less than 2 years is ideal). Options to Check out from the provider before purchasing a dedicated server: Dedicated VLANs – which isolate IPs and network traffic from other customers. Dedicated bandwidth pipes. Does the datacenter have more than on bandwidth provider? More providers generally means better network uptime. Custom Server Configurations. Hands free remote reboot or remote management cards. Remote hands support. Low setup costs, Monthly contracts On the other hand, colocation provides the flexibility and scalability to deploy equipment that best fits your needs and also to add servers and increase connectivity as your business needs grows. You also have physical access to your equipment whenever needed. The colocation cost is usually significantly less than dedicated server lease but high upfront investment in equipment purchase. In a nutshell, the choice between colocation and dedicated server lease can be evaluated by assessing your companies technical needs, budget, internet traffic and growth projections.
It really depends on what you need - for example, if you could afford to invest in your own hardware, colocation will be cheaper than renting a server from a DC. Cheaper, in terms of monthly fee, however, the DC might (will) charge you for every labor on your server (adding a new HDD, more RAM, replacing a component, etc.), also if your hardware fails, you are responsible for it . On the other hand, if you need more flexibility, it's better to directly rent a server from a DC - you're not reponsible for the harware, you do not pay upfront for the server, you could cancel at any moment. As for the poll - my vote is for a VPS, because the first step for a website to take after it is outgrown the shared hosting is the VPS - it's the cheapest option, does provide good amount of resources (limited however - for example CPU/Network/ i/o) and is very flexible environment for your website (you could add some custom software (depends on the virtualization) ).
Unless you have multiple servers, colo isn't worth the effort. In colo you need to have replacement hardware onsite incase there is a failure. As a result turn around times are slower. Dedicated the hosting provider carries the responsibility, and because they are monitoring the server 24/7, they will know ahead of time before there is a failure and be able to swap out the hardware preemptively. With any hosting solution uptime is important. Redundancy in your servers/network is key. VPS is good because redundancy is built in, but if you require a lot of resources, then VPS won't last you that long and you'll be upgrading soon