Colocation, dedicated server or private cloud: which fits your business?
Colocation means you own the servers and rent space, power, cooling and a network connection for them in someone else's data centre. A dedicated server is a whole physical machine the provider owns and rents to you alone. A private cloud is a cloud platform, with self-service virtual machines, used by one organisation only, and it can run on either. Choose by two questions: who should own the hardware, and who should run each layer from the machine up to your applications. If none of the three is clearly needed, a cloud server of your own is usually simpler.
Three models, defined
Colocation. Your hardware, in a provider's facility. The data centre supplies rack space, power, cooling, physical security and connectivity. Everything in the rack is yours: the servers, their parts, their firmware and what runs on them.
Dedicated server. The provider's hardware, used only by you. Nobody else's workload shares the machine. The provider sources it, racks it and repairs it; you usually run the operating system and everything on it. "Bare metal" generally means the same thing: a whole physical server rather than a virtual one.
Private cloud. The US National Institute of Standards and Technology (NIST) defines cloud computing as on-demand network access to a shared pool of computing resources that can be provisioned and released quickly. A private cloud is that kind of platform provisioned for one organisation only. NIST notes it may be owned and run by the organisation, a third party or both, and may sit on or off its premises. Open-source platforms such as OpenStack and Proxmox VE are common foundations.
How they compare
| Colocation | Dedicated server | Private cloud | |
|---|---|---|---|
| Who owns the hardware | You | The provider | Either, depending on what it runs on |
| Who replaces failed parts | You | The provider | Whoever owns the hardware |
| Who runs the operating system | You | You, unless you buy management | The platform operator for the hosts; you for your virtual machines |
| How you add capacity | Buy and install more hardware | Order a bigger or second machine | Start more virtual machines within the pool |
| Best for | Existing hardware, special equipment, full control | A demanding workload on its own machine | Many workloads for one organisation, with self-service |
Who is responsible for what
Every model divides the work differently. Microsoft's guidance on cloud security puts it simply: when you run everything yourself, you own the whole stack, and responsibilities move to the provider as you move towards managed services. Whatever the model, your data, accounts and access stay your responsibility.
- Colocation: the facility runs the building and the connection. You run the hardware and everything on it.
- Dedicated server: the provider runs the building, the network and the hardware. You run the operating system and everything above it.
- Private cloud: whoever runs the platform patches and operates it, and each team inside it runs its own virtual machines. If you run the platform yourself on your own or rented hardware, you carry both layers.
Self-run set-ups tend to fall behind in the same places: patching, monitoring, ageing hardware and backups that are rarely tested. Whichever model you choose, decide who does each of those jobs before you sign.
When each one fits
Choose colocation when you already own suitable servers, need special hardware such as storage arrays or network appliances, or must have physical ownership of the equipment.
Choose a dedicated server when a workload needs a whole machine: a regulated dataset or a contract that forbids shared hardware, a database that needs its own disks and memory, a build or render queue that keeps every core busy, or software licensed per physical processor.
Choose a private cloud when one organisation runs many workloads and wants to create and remove virtual machines itself, within a pool of capacity it controls.
Choose a cloud server when you need a Linux server of your own with root, but not a whole machine. It is quicker to start and simpler to change.
Open-source private cloud platforms
- OpenStack is a set of components, under the Apache 2.0 licence, that manage pools of compute, storage and networking through APIs or a web dashboard. It suits large clouds with many teams, and it takes skill to run.
- Proxmox VE is an open-source virtualisation platform, under the GNU Affero General Public License, combining the KVM hypervisor and Linux containers with storage, networking and clustering. It suits a handful of servers run by a small team. Its production update repository and support are sold as subscriptions per processor socket.
What Noiz offers
- Dedicated servers. Single-tenant hardware, specified for your workload and quoted before anything is ordered. The quote names every part, the set-up cost, the monthly figure, the lead time, the facility and who runs what. Root is yours from the first boot, and Noiz repairs or replaces failed hardware under the Hardware Policy. See dedicated servers.
- Colocation. Your own equipment in a quarter or a full cabinet, quoted per rack contract.
- Managed Linux. If you would rather Noiz ran the operating system, it is a separate, scoped line on the same quote.
- Cloud servers. Self-managed Linux servers with full root and a dedicated IPv4 address, provisioned within one working day. See Cloud servers.
Tell us the workload
Describe what will run, how much data it holds and how busy it gets, and we will say what fits. If a Cloud server would carry it, we will say so. If you are weighing a private cloud, get in touch and tell us what you have in mind. Open a ticket.
Sources
Checked 19 October 2026.
Definitions
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Note: while some of this content was produced with the help of AI, the final editing has been done by a real human being.
