Colocation vs Dedicated Server
Colocation means you buy the server and rent rack space, power and a network port in someone else's data centre. A dedicated server means you rent the whole machine, parts included; WebJi® dedicated servers start at ₹4,999 a month before GST. Colocation pays off only for owned hardware kept three years or more.
For Indian businesses weighing whether to buy their own server hardware or rent a whole machine from a provider.
knowledge
- Read time
- 4 min
- Sections
- 8
- Updated
- 14 Nov 2026
- Written by
- WebJi® team
Last editorial update: 14 November 2026. Prices follow the dated sources on this page; checkout confirms current charges.
Colocation vs dedicated server: the one-line choice
Choose colocation if you already own the hardware and will run it for three years or more; choose a dedicated server if you want a working machine this week and the provider to replace failed parts. The bill, the maintenance and the risk all follow from that one decision.
Colocation is rented space, power, cooling and a network port for a machine you bought. A dedicated server is the whole machine, rented monthly, with the hardware on the provider's books; learn what a dedicated server is. Neither is faster by nature; the difference is who pays for the metal and who gets the 2 am call.
What colocation and a dedicated server each include
Colocation sells you a place for your server; a dedicated server sells you the server, the place and the parts as one rental. The table is the short version of both contracts.
| Factor | Colocation | Dedicated server |
|---|---|---|
| Hardware owner | You | Provider |
| Upfront cost | Server purchase | None |
| Monthly bill | Rack space, power, bandwidth | One rental fee |
| Failed disk | Your part, your visit or paid hands | Provider replaces it |
| Hardware choice | Anything you ship | Provider's range |
| Setup time | Purchase, shipping and an install visit | Days, not weeks |
| Physical access | Escorted, by appointment | Not needed; remote console instead |
What colocation costs compared with renting a dedicated server
Colocation costs a one-time hardware purchase plus monthly rack, power and bandwidth; a dedicated server is one monthly fee. At WebJi® that fee starts at ₹4,999 a month before 18% GST for a Xeon E3/E5 class machine with 32 GB RAM, RAID storage, a gigabit uplink and IPMI, or ₹59,988 a year.
| Line | Colocation | Dedicated rental |
|---|---|---|
| Hardware | Bought once, depreciated over its life | Included |
| Rack space | Billed per rack unit (U) or block | Included |
| Power | Billed per amp or kW, often with a cap | Included |
| Bandwidth | Committed rate or monthly allowance | Included per plan |
| Hands-on work | Per visit or per hour | Included in support |
| Term | Often a yearly commitment | Monthly |
GST works differently too. A dedicated rental is one 18% service invoice. With colocation the facility invoice carries GST on its services, while the server purchase arrives on a separate vendor invoice as a capital asset; a GST-registered business can generally claim input credit on both, which your accountant should confirm. For what drives rental prices, see dedicated server cost in India.
The ₹4,999 start price is as published on WebJi®'s dedicated server page (read 29 October 2026); the quote or checkout confirms the current figure.
Remote hands and escort fees: the colocation line nobody budgets for
In colocation, every physical task costs either your own visit, usually escorted and billed, or the facility's remote-hands rate. On a rented dedicated server the same disk swap is part of the monthly fee.
Published rates are rare. One Australian provider, Rackmill, lists escort fees of $75 per 15 minutes in business hours and $150 outside, with a free business-hours installation (read on 14 November 2026). Two disk swaps and a power-supply change in a year can add several of those blocks, plus travel. Indian facilities quote these terms in the contract, so ask for them in writing.
Rack space and power: what a colocation contract actually rents
A colocation contract rents rack units, a power allowance, network ports and sometimes cross-connects, each priced separately. A 1U server uses one unit and one feed; a 2U box with redundant supplies uses two units and two feeds.
- Rack space: per U, often with a minimum block such as a quarter rack.
- Power: per amp or per kW, with a hard cap; get both the cap and the overage rate in writing.
- Bandwidth: a committed rate with burst, or a monthly terabyte allowance.
- Cross-connects: a one-time and a monthly charge for each carrier or peering link.
Is colocation worth it for a single server?
Usually not: a single server pays the minimum rack and power commitment, the install visit and its own spares, while a rental covers all of that in one fee. Colocation starts to earn its keep when several machines share the rack, the power block and a switch you already own.
The other case for colocation is hardware a provider will not rent: specialised storage arrays, licensed appliances, or GPUs you have already bought. If none of those apply, compare a rented bare metal server first.
Colocation in India: questions to ask before signing
Ask for the power allowance, the hands-on rate and the access notice period in writing; those three decide the real monthly cost more than the rack rate. Then check the location against where your users are.
- Confirm the power cap per rack unit and what happens when you exceed it.
- Get the remote-hands and escort rates for business hours and nights.
- Ask how much notice a visit needs and who may sign in.
- Check the city against your users' location, since distance sets latency; what a data centre is explains tiers and redundancy.
- Map the personal data on the machine to your Digital Personal Data Protection Act, 2023 obligations, which apply wherever the rack sits.
Where WebJi® fits: dedicated rental, colocation on request
WebJi® rents dedicated servers from ₹4,999 a month before GST and does not publish a colocation rack price; colocation requests are quoted by email before any payment. If you want the hardware looked after for you, compare managed dedicated servers.
For a quote, send the machine you own or the specification you need. Support answers at support@webji.services, 24/7 in Hindi and English, with an average first reply under 60 minutes.
Frequently asked questions
Is colocation cheaper than a dedicated server over three years?
Only if the hardware lasts and you run several machines. Add the server price, 36 months of rack, power and bandwidth, and at least a few paid visits, then compare with 36 months of rental. For one machine, the minimum rack commitment usually keeps rental ahead.
Do I still need IPMI or a remote console in colocation?
Yes. An out-of-band console such as IPMI lets you reboot, reinstall and see boot errors without paying for a visit. Make sure the facility gives that port a private network path, because an exposed management interface is a common attack route.
Can I move from colocation to a rented dedicated server later?
Yes, as a normal migration: build the rented server, copy data and configuration, switch DNS and then retire your hardware. Plan it around the end of your colocation term to avoid paying both. The dedicated server migration guide lists the steps.
What happens to my data if a rented dedicated server's disk fails?
The provider replaces the disk; whether data survives depends on RAID and your backups. RAID keeps the server running through one failed disk in most layouts, but it is not a backup, so keep copies off the machine as well.
Last editorial update: 14 November 2026. Prices follow the dated sources on this page; checkout confirms current charges.
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