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Starting Up A Colocation Service?
mhoskins asks: "I am considering the possibility of opening a Colocation service. I am trying to gauge the need amongst the community. Is there still a large need for low cost hosting for LUG's and projects? What would be acceptable pricing? Are people looking to host their own boxes or something like the CobaltRaq? What are the likelihoods that equipment will be bought, leased or rented? We expect of offer advanced services like host monitoring for those who want it. Is there any interest in that kind of service also?" Colocation services might be better for proto-Internet Businesses than spending the (large) amount of money needed to get wired.
Your target market depends on your size. If you are thinking of running a T line or two into your garage, you arent going to get taken seriously by many business customers. If you are looking to lease a building that is sitting atop a fiber backbone, you need to have your business plan done by MBAs and not Slashdot. What you do and who you can target will depend on how much money you have to get started.
If I was going to do this, I would combine colocation and consulting in one business. Then I would target small businesses with Internet needs and few tech workers. Check out real estate companies. They loathe hiring full time staff who arent making sales. Generally are slow (but interested) when it comes to picking up new technology. However their business can really benefit from a strong Internet presence. Show them the benefits, especially the ability to access data from home (agents love that), and then put together a package for them. Once you get the contract, you get monthly income from the hosting, and you will be their consultant because you manage their server. This wouldnt be too expensive to setup because you wouldnt need much office space, and your bandwidth needs would grow much more slowly than a "colo for 50 bucks a month" deal.
OTOH it is a lot more work than running around hitting the reset button and popping out floppies. However I do not see a rosy future for low end colo-only companies. What happens when having a big, reliable pipe to your home becomes the norm? You know when that happens, it will be cheap enough for businesess to have mega connectivity on their own. When Joe Dentist has as much bandwidth as you do, what vital services are you offering them? If they dont need you for something else, no one is going to want to stick a box in your rack. On the high end, people sitting on a huge bundle of fiber and selling hundred megabit plus connectivity packages are still going to be doing OK. Can you get there in time? Maybe you should you focus on something else and use colo as one of many products you offer.
Good luck...
-BW