“Colocation” (“colo”) refers to a dedicated, custom-built facility (a “data centre”) which offers various types of space (e.g. “rack” space, “caged” space, “cabinet” space or shared space) which businesses can rent to install their servers and equipment to connect to the internet. The data centre provides all the necessary infrastructure and maintenance of the building, spaces, power and back-up power (“redundancy”) in the event of power failure; the correct, constant ambient environment (air conditioning, humidity and cooling); 24 x 7 x 365 security and most importantly, excellent bandwidth with guaranteed connectivity (“uptime”) so that a business can rent whatever size of space it needs for its server and for any chosen length of time without having to create and manage its own facilities.
Over the decades, colo services have become the norm as businesses quickly realised the economics of not having to invest in the necessary infrastructure and staff to ensure that its servers stay up and running at all times thus securing its business continuity. Also using a colo means that it has a fast, scalable option to adapt to business growth as well as the opportunity to migrate to (for example) Cloud based services, virtualisation (replacing its actual server with a virtual server) and any other new “next-generation” service which becomes available.
A business customer can also choose whether it wants its own staff to administer the server at the data centre including its maintenance, upgrade and security testing (intrusion prevention and DDoS1 defence) or contract the colo provider to carry out such services. Many colo providers now also offer a range of added value (managed) services such as hosting, domain name registration and management, website development, security testing and checks as well as 24 x 7 x 365 support.
There are numerous names used for colocation facilities in different parts of the world including server “housing”, server “hotels” or server “farms”.
In order to categorise (and compare) the different type and levels of service offered by colos, several bodies2 have devised a “tier” or level of comparison from “Tier 1” being the basic to “Tier 4” being the highest. The “tier” categorisation is now widely used by colos to describe the level of service and facilities which is offered.
This contract has been drafted where the customer has rented space for its own server in the data centre and contracted for the colos managed services.
 Distributed Denial of Service.  The US Telecommunications Industry Association, a trade association accredited by ANSI (American National Standards Institute) published various levels of requirements called “TIA-942:Data Center Standards Overview” updated in 2017. Also The Uptime Institute, a data centre research and professional services organisation based in the US, defined the “Tier Standard” levels describing the requirements of expected uptime availability (tier 1 being the basic and tier 4 the highest).