Logistically, there are quite a few factors you have to take into account when making these decisions. The decision on where a server is going to be should actually be one of the first considerations when putting together a data management solution. Will the servers be sitting in a closet down the hall, in a server farm at your organization’s IT department, or in a data center down across town or even across the country? All of these are options, and which is correct depends on your situation.

Locating your servers at your own organization require that you have a good amount of expertise on hand. You need people who know what to purchase (if you’re not making that decision), how to set it up, configure it, optimize everything, keep it running, and stay on top of all of this during the life of the server. There are different titles involved, but the most common is System Administrator. A sys admin is generally a person who can do all or most of the previous list. Their jobs are typically to make sure hardware is up and running and configured to do so as best as possible. Additionally, database administrators (DBAs) might be brought in if you have a database system running to perform similar tasks – setting up and optimizing the database to work with your hardware.

Smaller servers might not require an elaborate setup and configuration. In such a case, it might be perfectly feasible to have a server not located in a dedicated IT area. They do generally have special power requirements, so some special considerations need to be taken into account, but provided the power, network connection, space, and cooling are there, you could possibly have your server located down the hall from you. If you or someone in the vicinity has the know-how to run it, this may be all you need.

Likely, however, you’ll need to place your server with the IT department or an even more specialized facility. IT Departments, depending on the size of your organization, often have Sys Admins on hand and should be able to get up to speed on your system to configure and manage it. You lose the convenience of being able to physically interact with your server (such as to plug hard drives directly into it at a moment’s notice), but you gain a specialized environment. You’re more likely to have all the power, cooling, expertise, rack space, and every other resource needed to run a server in an IT department. Unfortunately, for large organizations, the IT department might not be in the same building or even the same state, so this might make certain logistics difficult. Fortunately, it’s fairly easy to set up remote connections to servers allowing for any interaction that doesn’t require a physical presence to be carried out from anywhere.

Data centers are specialized locations for hosting servers. Often referred to as colocation, the basic idea is that you buy the hardware and let them run it. In reality, it’s a bit more complicated. For standard colocation, you purchase rack space (measured in ‘u’ which represents one slot in a cabinet where servers are mounted) for your servers and other hardware to be installed. Some data centers can rent out an exact amount of space for your configuration; others rent it out in blocks. Other expenses include the electricity used to power everything, the bandwidth used (public web servers will use considerable traffic compared to a private server with only a handful of users), and any servers you use, such as system administrators to maintain the system.

Data centers are often a good choice as they have specialized in this process and usually offer very reasonable rates. They have experts on hand 24/7/365 (well, most do) in case anything goes wrong – hardware or internet failure, power outages, fire, whatever. They’ll ensure your server stays up and running as much as possible.

In the end, cost is likely to be the determining factor. Some organizations might have policies requiring all IT assets to be housed within the company or managed in a certain manner. Provided your organization doesn’t, financials will likely play a major part. Data centers house experts who run servers for a living, provide physical assurances that your server will stay running, and can assist you in changes and other work that need to be carried out on a server. But in the end, you have to pay for your electricity, floor space usage, and the various services you have the staff perform for you.