Cloud vs colo: 5 considerations for tech startups

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07th December 2015

It's a great time to be a tech startup. Success stories like Uber and Airbnb have shown that no industry is infallible to digital disruption, and that a small company with big ideas can throw down the gauntlet to even the largest enterprise. Moreover, starting a digital business in 2015 is the cheapest and easiest it's ever been. Whether you're launching a cloud app or looking for someplace to store a mountain of customer data, you can rely on third-party cloud and colo services for the infrastructure there's no longer any need to kit out your own server room and deal with the many headaches that ensue.

Still, much as it might be attractive to opt for the cheapest public cloud solution on the market (or, on the other side of the coin, an ultrasecure colo facility in the same city as your office), sourcing infrastructure is something that calls for careful forethought. Obviously, you want a service that's as fast and responsive as you are. At the same time, you need to ensure that it'll continue to accomodate you as you grow, and that it'll support your business through thick and thin. Here are five of the things that tech startups should consider before adopting a cloud or colo solution.


What degree of flexibility do you need?

Outside of cost, one of the biggest benefits of the public cloud is that it's so fast. Commissioning and decommissioning servers takes minutes, not months if you need to respond to seasonal increase in traffic or set up a temporary development environment for an innovative product, you can practically click your fingers and have a new virtual machine up and running. And you can scale down again just as fast. Depending on whether you're leasing equipment from your provider or using your own, a colo service may not offer the same degree of flexibility.


What are your security and compliance requirements?

When it comes to security and compliance, however, colo offers significant advantages over the public cloud. With the latter, there's often a lack of transparency over where your data is stored, as well as limited compliance with industry regulations like PCI DSS. If your company intends to store and process highly confidential records, it makes sense to turn to a provider that can satisfy your security and compliance needs to the fullest. Otherwise, the repercussions of a data breach could be catastrophic enough to sink a startup even before reputational damage enters the picture.


What level of availability do you need?

Furthermore, a colo outfit might be able to guarantee a higher level of availability than a cloud provider. When you're active in the digital space, uptime is critically important an outage lasting even a few hours can translate into lost sales, lost productivity and any number of customer support nightmares. Think of the hubbub that erupts online whenever SaaS products like Slack go down, for example.


How important is handson control of your hardware?

This ties into handson control, too. If you store your data in a public cloud, you lose direct access to the hardware something that might be extremely important in a disaster recovery situation.


Could you use both cloud and colo?

Finally, the answer for your startup may, in fact, be to use a combination of cloud and colo services. Hybrid IT is a common solution among enterprises that need both the speed of the public cloud and the security of a colo facility of onpremise IT. It's no less useful for startups, which might for example choose to use the public cloud for development and testing environments, and a colo solution for confidential customer records.

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