In a world dominated by cloud services and subscription-based everything, it’s easy to assume that owning your own IT hardware is outdated. But that’s far from the truth.

At Smartt, we see a growing number of businesses turning to colocation not because they’re behind the curve, but because they want more control, compliance, and cost efficiency in their IT strategy.

If you already own servers, or are debating whether you should this post will help you decide whether colocation is still the smart move in 2025.

What Is Colocation, Really?

Colocation (or “colo”) means placing your physical servers inside a third-party data centre. You maintain ownership and control of the equipment, while the provider (like Smartt) supplies the power, cooling, physical security, and premium connectivity. It’s like renting a luxury garage for your servers, instead of trying to maintain a DIY setup in your office or warehouse.

Why Businesses Still Choose Colocation in 2025

1. You Already Own the Hardware

If you’ve recently invested in reliable servers, especially for custom workloads, it doesn’t make sense to throw them out for the cloud just because it’s trendy. Colocation lets you extend the life of that investment, without compromising uptime or performance.

2. You Need Full Control

Cloud services are great for flexibility, but not every business wants to hand over control of their infrastructure. With colocation, you:

• Choose your own hardware specs
• Install custom operating systems or apps
• Manage your own security stack and patch cycles

For companies running legacy systems, specialized apps, or regulatory workloads, that level of control is essential.

3. You Have Compliance Requirements

Industries like healthcare, finance, and government often require data to be stored in specific physical locations, with clear access logs and hardware-level controls. Colocation lets you meet these standards without building your own data centre.

At Smartt, our data centre is in Metro Vancouver, with:

• Redundant power and cooling
• Secure physical access controls
• 24/7 monitoring and alerting
• Canadian data residency

4. You Want Better Uptime Than the Office Can Offer

Power outages, overheating, and basic internet outages are common in office environments—not ideal if you're running critical systems.

Colocation provides:

• Backup generators and UPS systems
• High-speed, multi-homed internet
• Fire suppression and climate control
• 24/7 physical security and access control

Smartt even offers remote hands support via FlexHours—so if your team can’t be on-site, we’ll step in to help.

Who Is Colocation For?

• Manufacturers running on-prem ERPs and production monitoring systems
• Professional services firms with data compliance needs (legal, accounting, etc.)
• Software vendors hosting their own stack
• Media and creative agencies storing large raw files with predictable access patterns
• IT teams who want to retain control while offloading infrastructure risk

When Colocation Doesn’t Make Sense

Colocation isn’t for everyone. If you’re a startup without existing infrastructure, or your workloads are entirely cloud-native and low-risk, you might be better off starting with VPS (Virtual Private Server) or VPC (Virtual Private Cloud).

That’s why at Smartt, we don’t force you to choose one direction. With FlexHours, we help you blend colocation with managed cloud or virtual infrastructure, so your IT setup works for your actual business model, not just someone’s playbook.

Colocation + FlexHours = The Best of Both Worlds

Smartt’s Colocation Services are available as part of our FlexHours packages, so you can combine:

• Rack space and power
• Remote hands support
• Backups and monitoring
• Cloud services or SD-WAN as needed
• The VPS / VPC that comes already with your FlexHours package (so you can integrate both into a hybrid cloud, if you wish!)

It’s the perfect hybrid approach: keep your servers, get enterprise-grade infrastructure, and flex into the cloud when you're ready.

Have hardware but need a better home for it? Book a free consultation and we’ll show you what colocation looks like. No pressure, just smart options!