5 Tech Trends That Will Increase the Demand for Colocation in the Near Future


The drive to forsake cloud and on-premise storage for colocation is not new. We’ve written about this before, and it’s a trend we will continue to cover. 

Today, we’re looking at what causes this shift. Colocation is not new, but the appetite for it seems to be renewed. Let’s investigate and find out why.

Trend 1: Remote Work and Other Effects of the Pandemic

The pandemic accelerated the adoption of remote work. Even with most workplaces reopened now, employees say that they continue to work remotely at least partially—this time because of a personal preference, not because they have to.

Employees (especially the newer generations) love flexibility, and remote work gives them exactly that. Colocation fits the landscape perfectly by offering scalability, flexibility, and security in an environment where geographical location matters a bit less.

The Great Resignation has also caused massive shifts in the workforce and made certain positions nearly impossible to fill. By moving away from on-premise data centers, businesses of all sizes can reduce overhead costs and barriers to hiring internal staff.

Trend 2: The Rise of AI and Its Applications

With AI increasingly used in various industries, organizations need more high-performance computing. The problem with on-premise or cloud data centers is that they typically use legacy infrastructure, which does not support the kind of cooling and power modern businesses need. 

IT infrastructure has become the determining factor in what an organization can offer to its clients, in terms of services and products. 

At the Heartland Technology Data Center (HTDC), for instance, we use hot-aisle containment for efficient cooling. Investing in this technology for an on-premise data center usually comes with prohibitive costs. But when you opt for colocation instead, you can enjoy its benefits (read: high-performance computing) without the massive initial investment and ongoing upkeep costs.

Trend 3: IoT and 5G Drive the Demand for Edge Computing

2020 was the first year when IoT connections surpassed their non-IoT counterparts. By 2025, the number of IoT connections is expected to reach 30 billion.

Concurrently, 5G will push this development even further, along with the need for edge computing. Storing your data closer to where it’s being used (close to your HQ or to your customers) becomes a necessity.

Creating countless on-premise data centers is not a cost-effective option. Cloud storage falls short, as well, because you rarely know where exactly your data is stored. Colocation, on the other hand, can bring your storage to the edge effortlessly and efficiently. 

Trend 4: The Need for Better Uptime

In 2021, 69% of data center operators reported significant downtimes. What’s more interesting about this is that three-quarters of them said that the downtime was entirely avoidable, as it was usually due to human error.

Couple this with the IT staff shortage and you get a better picture of why maintaining a great uptime is hardly doable with on-premise infrastructure. Managing a data center means having a dedicated team on standby at all times.

More importantly, it means that your team is not there just to intervene when things go south. Quite the opposite—their main goal should be to prevent downtime from happening. But finding the right people for this job and paying them are tall orders.

Through edge computing and colocation, you can make sure that your data and essential applications remain accessible no matter what. For that to happen, though, you need to move away from legacy infrastructure and work with a modern data center.

Trend 4: Sustainability Is No Longer Optional

Europe’s Climate Neutral Data Center Pact is the first agreement to push data centers to become carbon-neutral. Don’t let the fact that its deadline is 2030 and that its name starts with Europe distract you. This is a global trend and the pact is signed by major US-based players, too, like IBM and Intel.

Moreover, consumers demand that the companies they do business with care about sustainability in every aspect of their processes—and data storage typically leaves a big carbon footprint. Working with a colocation facility that cares about sustainability is a major first step in adhering to the regulations that are bound to come and in attracting responsible consumers on your side.

Trend 5: Security Threats (Still) on the Rise

The number of cyberattacks will not diminish anytime soon, forcing organizations to stay on top of digital security.

Enhancing security means major investments, especially in the way you store and access your data. With cloud storage, you don’t really know what happens behind the scenes; you may be vulnerable and not even know it. Handling the security of your on-premise data center can prove quite costly, especially where staffing and modern security solutions are involved.

With colocation, you can bypass both of these problems. You have a dedicated team of experts to handle data center security. Plus, you are always just a drive away from your data, so you have full control over your hardware.

Want to learn more about colocation and why so many businesses choose it and will continue to do so? Get in touch—we’d be happy to help you figure out if it’s the right approach for you too!