11 Jan 2024

The Security Benefits of Colocation for Data-Intensive Companies

If you’re concerned about the security of your company’s data, you may have looked into colocation data centres. In this article, we explore the security benefits of colocation data centres, what to consider when implementing a colocation solution, emerging colocation trends, and why colocation is ideal for businesses with large volumes of sensitive information.

Understanding colocation

There are growing concerns about data security in today's data-intensive business landscape. Businesses with a high volume of data, especially critical and sensitive client and employee data, are pivoting to colocation data centres to address their data security concerns. Before diving into the security benefits, let’s define and unpack colocation. 

What are colocation data centres?

A colocation data centre (or colo) is a facility where businesses can rent space for servers and other computing hardware. It provides a secure, well-maintained environment with power, cooling and networking, enabling organisations to deploy their IT infrastructure without a big financial outlay to build their own data centre.

It’s a great solution if your business is seeking enhanced security and increased bandwidth and reliability for its critical IT infrastructure. Instead of investing heavily in constructing and maintaining a data centre, you can rent space in a colocation facility. It’s a cost-effective option and ensures that servers and networking equipment are housed in a secure, professionally managed environment. 

Key features of colocation data centres include:

  • Physical security: Robust measures such as surveillance cameras, biometric access controls and security personnel.
  • Redundant power and cooling systems: These ensure uninterrupted power supply and optimal temperature control for hardware.
  • Connectivity options: Connectivity solutions that enable high-speed internet connections and opportunities for direct interconnection with other businesses and service providers.
  • Scalability: Scaling capabilities that allow your business to expand or reduce space and resources according to your needs.

While you will pay a fee for floor space, physical security, power and networking, opting for a colocation solution will lower the total cost of ownership (TCO) associated with your IT expenditure.

Top security benefits of colocation data centres

Colocation data centres offer a range of security benefits, making them an attractive option for organisations looking to host their critical IT infrastructure. These benefits include robust physical security measures, redundancy features and compliance with industry standards and regulations. 

Let's break down each of the key security benefits of colocation solutions:

1. Robust physical security measures

Colocation data centres typically employ biometric access controls to ensure only authorised personnel can enter the physical facility. Biometrics can include fingerprint scans, retina scans or palm recognition, providing an extra layer of security beyond traditional access cards or PINs.

They also offer surveillance systems, including high-resolution cameras, deployed throughout the facility to monitor and record activities 24/7. This helps deter unauthorised access and provides valuable evidence if security incidents do occur.

Many colocation data centres also have on-site security personnel who monitor the facility round-the-clock. These trained professionals can respond to security threats promptly and handle various physical security issues that may arise.

2. Compliance and regulations

Using colocation can bolster your compliance capabilities. Colocation data centres typically comply with industry standards like ISO 27001 for information security management, GDPR for personal data protection and SOC 2 for security, availability and confidentiality, plus physical security standards to protect against unauthorised access, theft and vandalism.

This will give you peace of mind that you’re still meeting your regulatory obligations when hosting sensitive data offsite.

3. Redundancy and reliability

As colocation data centres often have multiple power sources, including backup generators and uninterruptible power supplies (UPS), this power redundancy ensures that servers and infrastructure remain operational even during power outages. And cooling systems are in place to maintain optimal temperature and prevent overheating, helping to safeguard against equipment failures caused by temperature fluctuations.

Multiple network connections from different service providers are typically available, ensuring high availability and minimising the risk of network failures. Plus, many colocation facilities offer hardware redundancy options, allowing clients to deploy redundant servers, storage and networking equipment for added fault tolerance.

The benefits of colocation solutions for data-intensive companies

Data-intensive companies looking for enhanced data security should consider using colocation data centres. They are purpose-built and equipped with state-of-the-art security measures, which are often beyond the reach of individual organisations. This level of security significantly reduces the risk of data breaches, ensuring sensitive information remains safe and confidential.

The redundancy features colocation facilities offer, outlined above, are crucial for data-intensive companies. In the event of a power outage or hardware failure, these redundancy features help maintain data availability and business continuity. Data-intensive companies can rely on colocation data centres to provide a stable and secure environment for their critical data and applications, mitigating the potential risks associated with hosting infrastructure in-house.

Common data-intensive sectors

Sectors with data-intensive needs that can benefit most from the security benefits of colocation facilities include:

Impact of data breaches

Data breaches are becoming a growing concern for companies. Their consequences extend far beyond financial losses, as they can damage a company's reputation and erode customer trust and confidence.

The average cost of data breaches reached an all-time high of $4.45 million in 2023, according to IBM – a 15% increase over the previous three years.

Beyond the financial impact of fines, penalties and potential lawsuits, other consequences of data breaches include remediation costs, increased downtime and disruption, overhauling protocols and systems to prevent future breaches, reduced customer trust, and loss of business; all of which can significantly impact business growth and success.

Choosing a colocation provider for implementing enhanced data security

Choosing the right colocation facility is vital for businesses and requires a thorough assessment of infrastructure security measures, reliability and alignment with your company's long-term objectives.

Consider the following criteria when exploring colocation solution providers:

  • Security measures – define what measures and protocols the solution provider offers and whether they meet your requirements and compliance demands.

  • Geographical location the location of a data centre is also important. For example, some regulations stipulate that certain data may only be stored in a data centre in certain regions. Plus, optimal geographic proximity improves speed, user experience, and business continuity.

  • Flexibility and scalability – determine the bandwidth that prospective colocation facilities can offer your business, and how agile their solutions are when dealing with fluctuations in demand. 

  • Support – you’ll get access to outsourced expertise, services and support, so scope out the level of support you need when exploring providers. It’s also worth investigating reviews and testimonials from their existing clients for valuable insight into the provider’s support capabilities.

  • Service-level agreements (SLAs) – you’ll need to know the SLAs involved, in terms of uptime, availability, response time, etc. Robust SLAs provide accountability and commitment to an agreed level of service.

  • Reliability and uptime – evaluate colocation providers’ uptime and reliability history and certifications like Tier 3 or Tier 4 standards, to ensure high availability and redundancy for critical infrastructure components.

  • Network connectivity performance – when choosing a colocation provider, assess their network options to make sure you get optimal performance and low-latency connectivity.

  • Managed services – providers offering managed services will reduce pressure on your internal IT teams, enabling them to focus on business activities that fully leverage their expertise.

  • Costs – explore different pricing models and fully evaluate costs to find a provider that matches your budget and operational needs and delivers tangible ROI.

For information and advice on selecting the right colocation solutions for your organisation, explore BSO’s Hosting Services to see what colocation options are available that suit your needs.

Future trends in colocation security

Colocation providers will continue to adapt to meet future security challenges posed by evolving cyber threats and regulatory changes. Emerging trends in colocation security include innovations in encryption, AI-driven threat detection and advanced cybersecurity measures. These will help to tackle the challenges that arise from the growing number of interconnected devices, a broader ecosystem of third-party partners and the increased sophistication of cyberattacks.

As tech advances open up new opportunities for cybercriminals, cybersecurity measures need to keep pace, and AI and machine learning will need to be leveraged more extensively to monitor, identify and prevent threats to data security. Regulators will also inevitably need to adapt and change to a fast-evolving digital landscape. In light of this, colocation providers will need to adapt and advance their service offerings to remain competitive and continue to meet changing customer needs influenced by these digital and regulatory changes.

In 2022, BSO partnered with Link11, a leading European IT security provider of cyber-resilience, enabling us to help companies further strengthen the resilience of their networks and critical applications.


As you can see, colocation data centres provide various and robust security benefits for data-intensive companies that help them safeguard valuable data assets and better mitigate the risk of data and compliance breaches. They can protect your business from crucial financial and reputation damage that stems from data breaches, giving you peace of mind while you pursue growth-enabling opportunities.

BSO's Colocation Services offer seamless integration, tailored spaces and bundled solutions to fortify data security and streamline operations for data-intensive companies. Our network and connectivity experts have a history of keeping data-intensive businesses connected and secure, enabling them to reach new levels of success without worrying about their data security and availability.

Browse our solutions or get in touch with our team to learn how we can meet your colocation needs and help you safeguard your critical data assets.

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The company was founded in 2004 and serves the world’s largest financial institutions. BSO is a global pioneering infrastructure and connectivity provider, helping over 600 data-intensive businesses across diverse markets, including financial services, technology, energy, e-commerce, media and others. BSO owns and provides mission-critical infrastructure, including network connectivity, cloud solutions, managed services and hosting, that are specific and dedicated to each customer served.

The company’s network comprises 240+ PoPs across 33 markets, 50+ cloud on-ramps, is integrated with all major public cloud providers and connects to 75+ on-net internet exchanges and 30+ stock exchanges. The team of experts works closely with customers in order to create solutions that meet the detailed and specific needs of their business, providing the latency, resilience and security they need regardless of location.

BSO is headquartered in Ireland, and has 11 offices across the globe, including London, New York, Paris, Dubai, Hong Kong and Singapore. Access our website and find out more information: www.bso.co