Most teams don’t think about infrastructure until something breaks—or traffic spikes. That’s when decisions around colocation vs. managed hosting vs. cloud start to matter fast.

At Meter, we’ve helped clients work through all three, tying each setup into smart network planning services that keep performance stable and costs under control.

Let's take a look at:

• A side-by-side comparison of colocation vs. managed hosting vs. cloud
• How colocation works and who it’s for
• What managed hosting offers
• Why cloud hosting fits fast-moving teams
• How to match hosting to your needs
• Why hybrid setups are gaining ground
• What to think through before you migrate
• How each hosting model hits your budget
• Quick answers to common hosting questions
• Why Meter Connect helps long after install

Colocation vs. managed hosting vs. cloud: Key differences

What is colocation?

Colocation is when you rent space in someone else’s data center but bring your own gear. You supply the servers. They supply the power, cooling, and walls. It’s kind of like paying rent on an apartment where you have to furnish everything—and fix the plumbing yourself.

Pros:

• Full control over physical and virtual stack
• Potentially lower cost over time

Cons:

• Requires on-site or nearby IT staff
• Long setup time and capital investment

Is colocation cheaper than cloud hosting?

It can be—long term. If you already own the hardware and plan to use it for years, colocation is often less expensive than cloud hosting. But upfront costs are higher, and you're on the hook for power, bandwidth, and maintenance.

Does colocation require in-house IT management?

Yes, someone has to rack the gear, monitor health, and replace failed parts. Some also offer managed colocation services, where they help monitor or maintain your equipment for an added charge.

For a more in-depth look at colocation, check out our article "What is colocation (colo)?"

What is managed hosting?

Managed hosting is like hiring a landlord who also does your IT chores. You rent the servers, but someone else installs the software, patches the system, and handles support. You still get dedicated hardware—it’s not shared like in the cloud—but you don’t have to manage the whole thing yourself.

The provider takes care of the big stuff:

• Setting up the OS
• Configuring firewalls
• Keeping things updated
• Making sure backups run

Good ones even monitor traffic and jump in when there’s a problem, day or night.

You still get a decent amount of control. You can pick your operating system, customize your stack, and decide how apps are deployed. But the physical machines aren’t yours, and you’re not swapping out drives or adding RAM on your own.

It’s a great setup if you want predictable performance without building a full infrastructure team. We’ve also seen companies move to managed hosting after getting tired of surprise bills in the cloud. If your workloads don’t shift much month to month, this model makes budgeting a lot easier.

Pros:

• Less IT overhead
• Dedicated resources

Cons:

• Less flexibility than colocation
• Can be expensive as you scale

For a more in-depth look at managed hosting, check out our article "Managed hosting: Benefits, features, & how it works."

What is cloud hosting?

Cloud hosting is like renting a slice of a giant, invisible computer. You don’t buy the hardware. You don’t even see it. You just log in, spin up virtual servers, and get to work.

Everything is abstracted—compute, storage, and networking. You pay for what you use, and when you need more power, it’s a few clicks away. No trips to the data center. No downtime for upgrades.

You don’t manage the physical side. The cloud provider handles all of that—racks, drives, cabling, cooling. You deal with apps and data, not hardware repairs.

It’s perfect for fast-moving teams. We’ve seen startups, media platforms, and seasonal retailers lean on cloud hosting to move fast and grow fast.

It’s built for flexibility. But if you’re watching your budget closely, that pay-as-you-go model can creep up on you.

Pros:

• Easy to scale and deploy
• No hardware to manage

Cons:

• Monthly costs can balloon quickly
• Limited insight into the physical layer

Which hosting model is right for you?

There’s no universal best. It depends on your team, your traffic, your budget—and how much control you actually want. Here’s how we think about it when helping clients sort through the noise.

Choose colocation if you have strict compliance rules, long-term hardware plans, or apps that can’t afford lag. You’ll need an IT team that’s ready to get hands-on, but you get full control in return.

Choose managed hosting if you want dedicated performance without rolling up your sleeves every time something breaks. It’s a solid middle ground—less hassle than colocation, more predictability than cloud.

Choose cloud hosting if you care more about speed and flexibility than squeezing every dollar. You won’t get deep access to the backend, but you can move fast and scale without touching a server.

At Meter, we’ve seen hybrid setups work well too. Some clients run secure workloads in colocation and burst into managed cloud setups when demand spikes.

How hybrid infrastructure works in practice

A lot of teams don’t stick to just one model. They mix and match—colocation for their core systems, managed hosting for stable apps, and cloud for anything that needs to scale fast. It’s not a workaround. It’s a strategy.

We’ve seen clients keep their secure databases in a colocation cloud setup while using managed cloud services for customer-facing workloads. Others move dev environments to the cloud but run production on dedicated hardware for better control.

The key is having a network that connects it all.

What to consider before migrating workloads

Moving from one hosting model to another sounds easy—until you hit reality. Shifting from colocation to cloud, or from managed hosting to colocation, means more than copying files.

Look at the workload first

Is it predictable? Sensitive to latency? Tied to specific hardware? If yes, then full cloud might not be a fit.

Check the budget next

Colocation has upfront costs. Cloud costs creep over time. Managed hosting is somewhere in the middle.

Think about your team

Do you have the skills to manage hardware? Want someone else to patch servers? Your answers will shape what works best.

At Meter, we’ve worked with clients reevaluating their hosting and colocation strategies during major migrations, especially when long-term cost and flexibility are on the line.

How to budget for colocation vs. managed hosting vs. cloud

Each model comes with a different cost curve. Colocation hits your budget hard at the start. You buy the gear, pay for space, and cover bandwidth. But over time, those costs level out—especially if you own your hardware already.

Managed hosting is more predictable. You pay monthly, and the provider handles the headaches. But that support comes with a price tag, and scaling usually means higher tiers, not just more gear.

Cloud hosting looks cheap at first. You pay by the hour or gig. But when usage spikes—or if you forget to shut down idle instances—bills get out of hand fast. That’s where managed hosting vs cloud becomes a real conversation—predictable pricing vs pay-as-you-go freedom.

We help clients map these cost patterns to real needs. Our team handles bandwidth planning, monitors usage, and finds ways to scale without wrecking your budget. Hosting is part of the picture. Smart network planning fills in the rest.

Frequently asked questions

What is the difference between colocation and managed hosting?

Colocation gives you physical control over servers. Managed hosting gives you rented machines that someone else runs. You own the gear in colocation. You don’t in managed hosting.

Which hosting option is best for security?

Colocation offers the most control, but managed hosting or managed cloud may be better if you lack a dedicated security team. They come with built-in monitoring and patch management.

Can businesses switch from colocation to cloud hosting easily?

It’s not automatic. Moving from colocation to cloud hosting means migrating apps, data, and network configs. We help clients plan transitions to minimize downtime and cost. You’ll also need to rethink your stack for the cloud’s operating model.

Is managed hosting the same as dedicated hosting?

They overlap. Dedicated hosting usually refers to rented bare-metal servers. Managed hosting adds services—like support, monitoring, and security—on top of that.

How do I choose between colocation, managed hosting, and cloud?

Start with your team’s strengths. If you have IT talent and want control, colocation is a solid fit. If you’d rather offload the grunt work, go with managed hosting or cloud hosting. Meter helps clients assess workloads and pick the setup that fits their growth plans.

We often walk clients through managed hosting vs colocation comparisons, especially when they’re weighing cost savings against hands-on control.

We also provide ongoing support after installation in the following ways:

• Network infrastructure design and setup
• Ongoing service management
• Help with internet sourcing and provider negotiation
• Cloud network management visibility tools

Partner with Meter Connect

Choosing between colocation, managed hosting, or cloud means looking past the server specs. You want a partner who actually helps.

That’s what Meter Connect does. We help you find reliable ISPs, install clean connections, and maintain them long after launch. We don’t walk away after the installation.

We also build vertically integrated networks—so we don’t just provision your service, we manage it end-to-end. That means fewer alerts, faster resolutions, and less stress on your team.

If you’re stuck deciding between colocation vs. managed hosting vs. cloud, let’s talk through it. We’ll help you make the call—and stick around to keep it running.

Request a quote from Meter Connect and get a setup that actually fits.