When a business needs server infrastructure, the comparison usually starts with two options: rent a server from a provider, or place your own equipment in a data center (colocation). On the surface they look similar — in both cases you’re paying for access to server capacity. But underneath, they are fundamentally different models with different trade-offs.
What is server rental
Server rental — also called a dedicated server — means a provider gives you access to ready-made server hardware. The hardware belongs to the provider; you pay a monthly fee and get remote access to the machine.
There are two main types:
VPS (Virtual Private Server). A physical server is divided into multiple virtual machines. Cheap and flexible, but resources are shared with other customers.
Dedicated server. You rent an entire physical server. More expensive than VPS, but resources are not shared — all machine power is yours.
In both cases you have no control over where the hardware physically sits, and you depend on whatever the provider offers in their price list.
What is colocation
Colocation means placing your own server equipment in the racks of a commercial data center. You buy the servers yourself; the data center provides rack space, power, cooling, physical security, and internet connectivity.
You manage your equipment remotely. If physical access is needed — for a hard drive replacement or recabling — you can use the data center’s remote hands service or visit in person with a staff escort.
Key differences
| Parameter | Server rental | Colocation |
|---|---|---|
| Hardware ownership | Provider | You |
| Upfront costs | Zero | Hardware purchase |
| Configuration control | Limited by price list | Full |
| Scaling | By subscription tiers | By your requirements |
| Cost predictability | Fixed subscription | Rental + your CAPEX |
| Physical access | None | By arrangement with DC |
| Data localisation | Depends on provider | Under your control |
| Long-term cost | Grows with load | Lower at steady-state |
When server rental makes more sense
Startup or small business. No budget for hardware, or load is still unpredictable — rental lets you start without capital investment.
Temporary or irregular workloads. A three-month project, a test environment, load testing — pay while you need it, stop when you don’t.
No in-house IT team. The provider manages the hardware and hypervisor. You don’t need an administrator watching physical servers.
Small traffic and data volumes. If the workload is light, a VPS or one dedicated server covers the task without excess cost.
When colocation makes more sense
Steady, predictable load. The economics shift as load grows: monthly rental of several servers quickly exceeds the cost of owning equipment plus rack rental. Typically from 3–5 servers onwards, colocation is cheaper over a three-year horizon.
Specific configurations. Need a GPU server for AI, a specific network card, non-standard RAM or storage speed? In colocation you buy exactly what you need rather than picking from a provider’s catalog.
Security and compliance requirements. Financial services, healthcare, and public sector organisations often have strict requirements for physical access to servers, data custody chains, and audit trails. Colocation in a certified data center addresses this.
Data localisation. In Kazakhstan, personal data of citizens must be stored within the country. Colocation in a Kazakhstani data center gives you full certainty about compliance — you know the physical address of your servers.
High network load. Several dozen terabytes of monthly traffic becomes very expensive in server rental. In colocation you pay for bandwidth capacity, not per gigabyte.
Real economics: a sample calculation
A typical scenario: a company needs 4 servers for production workload for 3 years.
Dedicated server rental: ~$400–700/month per server × 4 = $1,600–2,800/month → $57,600–100,800 over 3 years.
Colocation: purchase of 4 servers ~$15,000–20,000 + 4U rack rental ~$300–500/month → CAPEX + ~$10,800–18,000 OPEX over 3 years = $25,800–38,000 over 3 years.
Colocation is one-and-a-half to two times cheaper at comparable load. At the end of the term the hardware is yours and can be upgraded or sold.
Colocation in Kazakhstan
The Kazakhstani colocation market is growing alongside data localisation requirements and the country’s digital economy expansion. When choosing a site in Kazakhstan, key parameters include:
- Reliability tier: for critical systems — Tier III or Tier IV.
- Location: Astana or Almaty, depending on your business geography.
- Available power density: kW per rack and headroom for growth.
- Connectivity: number of independent carriers and latency to key destinations.
- Certification and compliance: ISO 27001, compliance with MCRIAP requirements.
Akashi Data Center in Astana offers Tier IV colocation — the first such facility in Central Asia — with four independent fibre entries and a redundant 100 MW power infrastructure.
Frequently asked questions
What is the difference between colocation and server rental?
With server rental, the hardware belongs to the provider and you only pay for access. With colocation, you own the servers and place them in a data center, paying for space, power, and connectivity. In colocation you have full control over the configuration and your data.
Which is cheaper — colocation or server rental?
At small volumes, rental is more convenient — no upfront investment. At steady load from 3–5 servers, colocation becomes more economical: hardware depreciates, and monthly costs are lower. Over three years, colocation is typically one-and-a-half to two times cheaper at comparable load.
Can I place GPU servers in colocation?
Yes. GPU servers (for AI/ML, rendering, HPC) consume significantly more power and generate more heat than standard servers. Check the data center’s power density allowance per rack (kW per rack) and whether they support high-density configurations.
Do I need to go to the data center to maintain servers?
For most tasks, no. Server management happens remotely via IPMI/iDRAC/iLO, KVM-over-IP. When physical access is needed — replacing a drive, recabling — the data center provides a remote hands service or organises an escorted visit.
What is server rental in Kazakhstan?
It means renting a VPS or dedicated server from a Kazakhstani or foreign hosting provider. An important point: when storing personal data of Kazakhstani citizens, the server must be physically located in Kazakhstan. Always verify the physical location of hardware before signing a contract.
Considering colocation for your infrastructure in Kazakhstan? Learn about colocation at Akashi or contact us — we will calculate the cost for your configuration.