Yep, that's about right, you just got a good price on your leased server.
That is the standard for colocation though, do you have a location in mind?
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Colocation is generally cheaper in volume. You can usually get say 1/2 rack of colo space for cheaper than say 10 dedicated servers.
It's a toss up. Colo is great for situations where you need to get servers into the data center and don't need an INSANE amount of bandwidth. You can get a decent rate on bandwidth for colocation. However, if you really want to eat bandwidth, there are many deals on dedicated servers out there. Generally speaking, bandwitdth tends to be cheaper per meg with dedicated servers than with colo.
I use colo because I like using specific server and network hardware. I also run application servers, and the hardware required would be much more expensive had I gone with dedicated servers.
I just spoke to someone today that wanted to colocate 1 server in Orlando, but knew nothing about server administration and wanted to use a server that was about 8 years old.
I told him for the price to colo 1 server, he'd be better off going dedicated.
As silly as it may sound I think it all boils down to overselling. As you move up the hosting 'food chain' the provider expects you to actually use closer to 100% of the resources that you are buying. Colo is the 'top' of the food chain and therefore the most expensive.
A single server with standard bandwidth usage, etc. is not what colocation is for. Colocation is for special cases, where you have multiple servers, possible database servers that don't use much/any bandwidth, any systems where you need specialty hardware, etc. It is easier for a data center to manage homogeneous equipment, such as in a dedicated server environment. With a colocated system it is requiring custom network setup, advanced space/power planning, etc. In addition, when support is requested, the hardware is basically unknown, resulting in additional delays and costs.
There are many factors that go into creating a high quality data center. $69 for colo on a single server sounds like a great deal, depending on other associated costs and the amount of bandwidth you get. Redundant UPS systems, diesel generators, manned security, and the cost of power is what you are paying for in colo.....Is the facility you are looking at going to meet your demands for your sever?
Some others have kind-of hit on this, but they didn't really say it outright. The fact is, you purchased a very low-end machine - relative to the what's currently available from the major manufacturers. Geeks.com is a great place to get a bargain price on yesterday's gear.
My server isn't top of the line by any means, but definitely a lot better than a Geeks.com special. An HP DL380 G5, 16GB RAM, 4x147GB 10k SAS drives, 1x320GB SATA drive and a P400 RAID controller with battery-backed write cache. To lease a comparable "black-box" with this configuration from a datacenter would cost me in excess of $800 per month at minimum due to high-end components to achieve the performance my SQL Databases require. Through frugal buying and bargaining the total cash outlayed was around $3,000. Accounting for my bandwidth, 2Us of rack space and 3 amps of power, I was able to get a great deal on my co-location and it costs a fraction of the price of the leased machine - every month. At $800 per month, I've completely paid for the hardware in 4 months. After that, I save big bucks every month. Money better used for expanding my business.
To me, co-location is a far better solution. If I only needed your average SATA hard disks attached to a NIC and a CPU then dedicated might have been something worth sticking around for. It doesn't hurt me that I've got more than 12 years of experience with Compaq and HP hardware -- enough to know exactly how they work and trust their reliability to trust them enough with my customer's data.
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Not to repeat but just 2nd the comments of objectzone...colocation is for your own purchased equipment. Over the long run you will absolutely save money. but when you start leasing might be a better option. low upfront costs with no worries about upgrades. just stop renting the "old" server and rent a newer one.
Remember that colocation has enterprise or better resources. lines that not only outperform comcast at home but are lower latency, better uptime and redundant. Battery backups/multiple power grids are very useful and think about having comparatively cheap usually very smart techs able to help you.
Think about calling a consulting company, having them come to your server and do your work. it'll be 200-400 min. remote hands is a lot quicker and more efficient.
A tip if you colocate is go redundant. multiple procs (even older/lower spec), multiple drives in raid of some kind and multiple power supplies. If you have a failure your system stays running while you procure replacement parts.
I'd take a look at FDC's bandwidth challenge, $39 for a server is quite a steal and I think bummer said it was like $10 to upgrade to 2TB.
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re-reading the post and looking at the specs the dedicated server is very low specs. consider the new dual processor quad cores have over 8 times the processing power in a 2u server. That's where you colocation makes sense. it would cost $700 (very rough number) to have a huge dedicated server but once you buy it only $100 - $150 a month to colocate it. 8 times the clients and after some months you have the server paid off and its profit time
Colocation is great, but it really is a Volume thing. You don't want to colocate if you have a Pentium 4 or a Dual Core 1u server only. You can find that server specs cheaper just by leasing one.
I would only colocate if you had really HIGH-END hardware that would cost you hundreds every month if you were to rent it. Or if you have 5 or 6 servers where you could rent part of a rack for a great price.
Good luck, I too also recommend Joesdatacenter.com for Midwest colo.
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Colo is always something that should be considered heavily before making decisions that will ultimately fall upon the server owner and the client. Hardware in general is replaced every 18-24 months, and costs per server can be considerable. Most decent colo servers I see range in price from $2k - $3k per server, not including repair or replacement warranties, which unless you have, that cost goes up more because you need to stock spare equipment for when your hardware breaks. There's no guarantee the DC stocks your brand of RAM/ RAID cards, HD's, etc. and unless you can grab it local, factor 1 day delivery for next day parts, so if you're down and don't have it, can you afford 24 hours minimum of being offline?
Colo is a great environment for some, and horrible for others, because the responsibility lies with the owner to diagnose, repair, replace equipment or pay someone else time and material to do it, the costs can add up. Definitely do your homework before choosing either option and know what you're in store for, because once you're live, either way it's not a lesson you want to learn first hand the hard way.
What I like to ask people is how much time and effort they want to put into managing their infrastructure. Colo can indeed be great for some people, who want to focus on maintaining and monitoring and troubleshooting and upgrading their gear as necessary. If you want comparable uptime to a managed host you'll, of course, want to purchase 'remote hands' services as well so that somebody is there 24/7 if you're not, and you'll want to always stock spare parts.
You can indeed save money, but when compared to the value you get with a managed hosting product you put a lot of effort into saving that money. Generally the decision comes down to what the value of your time is, how much tolerance you have for problems occurring, and ultimately how much you want to focus on infrastructure. For some the colo value proposition works - especially on a bigger scale. For others, going it alone isn't as appealing.
I just specced out colo for my company as we're expanding our operations, We already have 2 full cabinets at 2 different datacenters.
To give you an example:
We're paying $1400/mo for 42U cabinet, 30amp power, 10mbps commit with 100mbps burst. We need to expand because we ran out of power (20 servers)
The expansion I specced out was at a separate facility as we need geo-redundancy for DNS traffic.
This was the quote I got: ~$1200/mo for the 42U cabinet w/30amp power, and I'm waiting to hear back on the bandwidth terms since it's a carrier neutral facility. $200/mo for ethernet cross connect, and then whatever the bandwidth charge from the provider, and we'll be looking at $2-300/mo for a similar 10mbps commit w/100mbps burst unless we go with cogent for $70/mo on a 10meg commit.
Co-Location is for larger operations where your company absorbs the extra expense as cost of doing business, or you are a larger host and have dozens of servers and are looking to lower your bottom line.