Compare Top Colocation Billing Models 

colocation billing systems

StrataCore's custom sourcing process can help to clarify how much you are buying, and at what price to ensure you provision your IT resources appropriately to get the most for your money. 

Colocation Billing Models

Comparing colocation pricing quotes from multiple colocation vendors can be a daunting task. Each company uses a different colo pricing methodology and billing model. You may be even comparing apples to oranges, as pricing is based on complex service and data models. StrataCore can simplify this process and ensure you get the best price for the services that suite the needs of your business by normalizing the unit price across the different models.


Power is one of the most important components that must be examined when comparing colocation facilities. You must understand the many ways power is calculated and sold to truly compare facilities on an apples-to-apples basis. There are at least a dozen different ways in which colocation providers define watts per square foot related to their power density. Unfortunately, some provider definitions are designed to mislead the client.


StrataCore's custom sourcing process can help to clarify how much you are buying, and at what price to ensure you provision your IT resources appropriately to get the most for your money. 



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Example of 4 common definitions of colocation billing models:

  • Watts per square foot equals max breaker capacity at 100% of the A and B circuits (this is most misleading and favors the provider)
  • Watts per square foot equals max breaker capacity at 100% of just the A circuits (this is misleading and favors the provider)
  • Watts per square foot equals max breaker capacity at 80% of just the A circuits (more reasonable and realistic but still favors the provider)
  • Watts per square foot equals max actual consumable power, not dependent on breaker capacity. The client is allowed to overbuild circuits and is billed on a true metered power basis (this favors the client)


What Are the Main Differences Between Colocation Billing Models?

If you're currently working in the telecommunication field but wish to explore new ways of operating your business at a low cost, you should look into the Colocation Billing Models. Some of the key factors you must take into consideration include how the system works and what are the service agreements. One of the best approaches is to seek the help of an expert, such as our Tech Advisors, who is willing to discuss the Colocation Billing Models in detail. When you make the effort, there are several benefits you stand to enjoy. It's not only possible to save money but also increase productivity and lower maintenance costs.


Many people think that colocation billing models are suitable only for large enterprises that require huge power consumption and enormous amounts of bandwidth. Such facilities cannot deal with a single tenant facility or a small-scale rack-based solution. The truth, however, is that small and medium sized enterprises can indeed benefit from this innovative technology. In fact, some of the largest global corporations invest in a number of single tenant facility and enjoy cost-effective and highly productive solutions.


How the Colocation Billing Models work?


To understand how the billing models work, it's important to first look at the key operational concepts. You must consider air quality, power requirements, power distribution, and maintenance issues. If you implement a successful colocation solution, these key operational concepts will play a key role. For instance, a good solution will allow users to access the data at any time and use applications that consume minimal power. This means that any power spikes will not affect the performance of the servers.


The other fundamental concept that must be considered is airflow management. This is critical because it determines how many users can access the data at the same time. Single tenant facilities have to deal with limited access while large multi-tenant facilities face significant challenges in achieving efficient airflow management. Many of the advanced single tenant facilities can maintain efficiencies of over 90% just by making some changes to how they do business.


One important example of the importance of airflow management is SLA or Service Level Agreement. A SLA outlines the obligations of both the owner of the data center and the service provider. The owner is responsible for providing equipment that maintaining steady levels of power, servers, routers, and telephones. He also has to ensure that all employees using these resources follow proper guidelines and procedures. On the other hand, the service provider has to ensure that it doesn't overload the server or disable the routers. In addition, the provider has an obligation to the end-user or the tenant to perform quality services and end the connection if the latter fails to meet the agreement.


Other important considerations are reliability and performance. In this case, one of the best solutions is a SLA that involves both the owner and the service provider. For most customers, reliability is easier to monitor than performance since performance can fluctuate depending on the usage at hand. Hence, it may be more appropriate to run a third-party audit in place of relying on the owner's own assessment. Furthermore, multi-tenant facilities can benefit greatly from a service quality team to help in identifying the cause of slowdowns or other abnormal activities.


A multi-tenant facility can also take advantage of special tools such as automatic billing via IMAP and POP3. These tools provide a fast way to determine which tenant used what resource and to eliminate the possibility of duplication of costs. Another way to control billing errors is through usage logs. These logs can be set up with parameters that indicate the time the machines were used, the amount of bandwidth downloaded and/or uploaded, and when the disk space allocated or reserved was used. With this method, an owner can easily pinpoint which activities caused the billing mistake.


As more enterprises are turning to colocation for their data centers, the importance of colocation billing models continues to rise. These billing tools allow IT managers to accurately pinpoint the causes of lapses and troubles. By doing so, they can make necessary adjustments or changes to their location operations. In addition, with accurate data in hand, IT managers can easily spot areas for improvement.


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