Hosting with server colocation
Server colocation has become extremely popular. Back a few years, it was more common to try to host servers yourself. The trend was for a company to construct a data center on their premises. There were several reasons that in house hosting was preferred.
Early on, server colocation companies had many service interruptions. Often there was equipment failure as these companies launched. During the dot com boom, it was common for server colocation corporations to over promise. They were all hurting for revenue and they needed to get business any way they could. Many of those hosting companies went out of business with the bust in dot com.
What is the current state of server colocation services? There are certainly still companies that over promise and under deliver. But on the norm, enough time has passed that the good companies have sorted themselves from the bad. Also, the technical issues that were common in the early days are gone. Much of the core routing and load balancing equipment has been through many versions of development.
A new comer to the server colocation industry is virtualization. With virtualization hosting companies are able to deliver much more reliable server hosting. This equates to lower costs for server hosting. While you will still find in house data centers at the big companies, people are generally more secure with the idea of outsourced colocation.