Colocation web hosting is similar to the dedicated web hosting service, but the user owns the server. Colocation is a service in which a company will connect a server that you own to the internet. If you do not already have one, hosting company will offer to build a server for you. The host will plug your server at its data center providing you access to its network and infrastructure. The webhost is reponsible for the network infrastructure and the data center while you are responsible for the server through remote access.

Colocation service is ideal for those that require complete control over their server configuration. With co-location you would have to evaluate the specific providers to go over their terms of service, the security of their location, their bandwidth providers, backup and power systems. Some co-location hosting providers may also offer separate management contracts for the day to day maintenance of your server.

Colocation web hosting: Best suited for growing web sites with high traffic, for large business and its usually the most expensive hosting solution

Advantages of Colocation web hosting:
- Colocation hosting include all the advantages of dedicated hosting – you have the resources of the entire server and bandwidth to do with as you please
- Lower costs, because you own the server, your monthly fees don’t include charges for hardware maintenance and upkeep
- High security
- High up-time

Disadvantages of Colocation web hosting
- Colocation puts you in charge of the hardware, but that also means that you are responsible in the case of hardware failure.
- Initial costs of colocation are much higher than dedicated hosting
- Hardware upgrades are more expensive, because you have to buy the new equipment.