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Five Reasons to Lease Data Center Space

Five Reasons to Lease Data Center Space

Recent studies confirm that as companies are increasing their data center space, the amount they actually own will decrease in the coming years. Leasing a data center incurs lower costs, a significantly faster timeline, and requires far less expertise than designing, building, and operating a data center. According to a new report from Allied Market Research, the colocation market is expected to grow from $25B to $51.8B over the next five years, but just why exactly are organizations entrusting IT infrastructure to data center operators?


Economic Gains

Leasing a data center requires a smaller up-front investment from the end user, as it requires a significant amount of capital to build the solutions. By outsourcing, companies are not obligated to pay the up-front money needed to buy a site, connect it to power, fiber, and water infrastructures, construct the data center shell, and purchase and install equipment.Users also directly benefit from the size of large data center operators who frequently leverage their position by creating cost advantages related to facilities, power cost, and operations.

Vital Flexibility

By using colocation or cloud resources through data center operators, corporate users can strategically place locations in multiple markets. The alternative is building data center infrastructure in multiple markets which is a long-term, high capital commitment that only proves financially viable and practical for a small amount of companies. Additionally, colocation data center operators are much more flexible in regards to term commitments, allowing companies room to adjust their infrastructure accordingly as their business changes over time.

Scalable Options

Most companies’ IT needs are always changing, meaning that not only must their strategy evolve, but so must their infrastructure. While one solution may fit the business today, companies are wise to consider the impact of changes to its core business, acquisitions, and consolidation projects. While owning and adjusting data center infrastructure to fit current needs can be a costly endeavor, scalable options allow companies to ease their solution over a period of time when the IT load isn’t as heavy.

Amplified Competition

To create an attractive proposal, data center operators now provide disaster recovery, cloud, managed services, colocation, interconnection, and other services that meet any needs a user may have to remain competitive. They are building facilities better than ever, delivering greater efficiencies, infrastructure redundancy options, and the capability to house higher densities. Operators have also improved their operational procedures, now focusing on constructing facilities with greater uptime, redundancy, critical systems, security, compliance, and connectivity, all at more aggressive rates to stay ahead of the competition.

Timing Advantage

The changing business climate is causing users to want and need access to their data center as quickly as possible. Leasing often provides an organization with a faster path to their end data center solution, even as strategies change over time. With the infrastructure already in place, companies can move into their leased solution and immediately implement their strategy, often providing a more reliable execution path. As companies depend more and more on technology, the timing advantage leasing data center infrastructure affords becomes increasingly important.

For most IT departments, the benefits of leveraging the latest technologies and 100 percent uptime guarantees while simultaneously reducing costs makes leasing data center space and colocating a viable option in today’s ever-changing markets. To ensure that your company understands and evaluates the best option for its business needs, visit, or contact our team for additional insight about the advantages of leasing.

About Our Contributor

Michael Lahoud

Co-Managing Partner & Chief Operating Officer
Michael drives and implements Stream’s overall business strategies and technical go-to-market offerings, with responsibility for site development, design and construction, supply chain and operations. Read More