When does colocation beat cloud financially?

Colocation typically beats cloud at >$20,000/month cloud spend with predictable workloads. Hardware amortized over 3-5 years + colo costs ($500-2,000/rack/month) often delivers 40-60% savings.

What are typical colocation costs?

Colo facility: $500-2,000/rack/month (power + cooling + connectivity). 10Gbps bandwidth: $200-1,000/month. Security + management add $200-500/month. Hardware purchase is a separate capital expense.

What hidden costs does colocation have vs cloud?

Colo hidden costs: hardware refresh cycles (every 3-5 years), hardware failure replacement, network redundancy equipment, remote hands fees ($100-300/hr for physical work), and staff to manage servers.

Colocation vs Cloud TCO Calculator

Calculate Total Cost of Ownership for colocation vs cloud hosting. Compare upfront hardware, colo facility costs, power, and networking vs cloud OPEX.

AI & SaaS Tools

SaaS Metrics

AI Compute

AI ROI

LTV:CAC Ratio

ARPU ($/month)

Monthly Churn %

CAC ($)

Gross Margin %

LTV

$3500

LTV:CAC

11.67

Payback

2.9 mo

Health

Healthy ✓

Benchmark: LTV:CAC ≥ 3 is healthy. Payback under 12 months is excellent. Under 1 means you lose money on each customer.

How to Use

Enter the values for the scenario you are assessing. Calculate Total Cost of Ownership for colocation vs cloud hosting. Compare upfront hardware, colo facility costs, power, and networking vs cloud OPEX. Use the colo vs cloud tco result to inform your calculation.

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Frequently Asked Questions

When does colocation beat cloud financially?

What are typical colocation costs?

What hidden costs does colocation have vs cloud?