Abstract

This IDC Survey Spotlight examines the top reasons for using managed hosting and colocation services. The surveyed respondents quoted cost and security followed by operational efficiency as the top factors behind the escalating adoption of managed hosting and colocation services. Hosting services has been transformed by the advent of highly advanced technologies such as hyperconverged storage, bare metal, artificial intelligence, and machine learning. Implementation of latest tools and technologies will automate the operational process and significantly reduce the cost and complexities of hosting services.

Industry trends such as datacenter consolidation, virtualization, secure interconnection, IoT, and adoption of cloud services will increase the appeal for enterprises to more aggressively leverage colocation providers. The adoption of 3rd Platform technologies such as cloud, social media, mobile, and analytics has significantly impacted the entire IT ecosystem including the way enterprises interconnect to cloud providers and the provision of services by network and datacenter infrastructure providers such as Equinix, Digital Realty Trust, and CoreSite.

Enterprises are embracing a hybrid IT approach to manage their datacenter infrastructure services. They are combining traditional hosting infrastructure with the modern private cloud and public cloud technologies to gain the benefits of multiple environments. As enterprises transform, their requirements for cloud computing, storage, network, and power continue to grow exponentially. The use of colocation is transforming datacenters into the "nerve center" of IT infrastructure and a crucial exchange and crossroads for the entire IT ecosystem.

Increasing, intense competition among the major hosting players — GoDaddy, Bluehost, HostGator, AWS hosting, and Rackspace hosting — as they continue to adopt competitive pricing of web hosting services will force other players in the market to bring down the prices of hosting services to remain competitive in the market. The rising demand for hosting services at competitive pricing will increase the volume of web hosting services specially among SMBs and ecommerce companies.

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