collocating Server means its your responsibility to choose your own software and hardwares that keep the server always ready for operations and keep the server updated. The hosting company maintains the connection to the Internet and deals with environmental details such as uninterruptible power supplies (UPSs), fire controls, and air conditioning. On the other hand, you're responsible for that server's upkeep.
This sometimes misinterpreted that collocation is identical to dedicated hosting. But its merely a misconception.With collocation you constantly have to maintain all the server resources so as to provide flexibility and un-haulted services to your customers.
When you opt for dedicated server collocation with the hosting company, you pay for the physical space that your server takes up. collocation hosting usually requires a higher startup cost than renting a server from a hosting company. The server itself will cost around $4000 for a low-end model, and $9000 for a midrange server. A half-rack of space at a colocation facility will cost between $500 and $700 to start up and the same amount each month. Finally, you'll have to purchase a switch or a router, which will cost between $1500 and $2000 at the low end. This would result in an initial outlay of at least $7500 -- and it doesn't include the costs of staff time for setup and configuration, or the cost of equipment depreciation, insurance, and the standby equipment.