These co-location facilities offer the customer a secure place to physically house their hardware and equipment as opposed to locating it in their offices or warehouse where the potential for fire, theft or vandalism is much greater.

Most co-location facilities offer high-security, including cameras, fire detection and extinguishing devices, multiple connection feeds, filtered power, backup power generators and other items to ensure high-availability which is mandatory for all Web-based, virtual businesses.

Co-location sites are being erected at various points around the world to provide services to the rapidly expanding Web hosting and e-commerce marketplace.

The term co-location is also known as colo.