Colocation is a service provided by an internet service provider. Essentially, you provide them with a computer with your choice of operating system and software installed on it (depending on their policies), and they provide you with the bandwidth and uninterrupt supply of power you need to run things on the internet.
There’s a number of problems with this scheme of doing things, however! If you’re providing the computer and software than that means you’re going to also be administrating every aspect of it. This means that you’re going to have to get it initially setup in the first place, make sure it is secure against all the known forms of attacks that can happen to your server, doesn’t go down for days while you’re upgrading software, and keep your software on your system up-to-date!
This is where Managed Hosting comes in. Managed Hosting bridges the gap between the ease-of-use of standard webhosting services to colocation
Managed Hosting is essentially a service where you have complete administrative abilities over a system provided by your internet service provider, but they set it up, provide the computer to your specifications, and keep it up to date.
Yes, Managed hosting is a very real way takes away much of the risk associated with colocation while still giving you the ability to put up a system to your specifications and it be SECURE. This alternative to colocation is taking the internet by storm, and is quickly becoming the standard of the industry for an easy and safe solution for internet business owners.
There is also Hacking problem with colocation hosting.