How to Read a Colocation Invoice: Every Line, Decoded

Your colocation invoice looks simple. Space, power, cross connects, some fees. Eight or nine lines on one page.

But two of those lines usually hide most of the markup. And one of them is written in a way that lets the provider bill you more every month without telling you.

Here is what each line means, and where to push.

Space (the cabinet or cage fee)

This is the physical footprint. A quarter cabinet, a half cabinet, a full cabinet, or a private cage. It is billed as MRC (monthly recurring charge).

A full cabinet in a Tier 3 facility runs anywhere from $600 in a secondary market to $1,800 in downtown Manhattan. If your bill says $2,400 for a single cabinet and you are not in a top five market, ask why.

The space line itself is rarely where the margin lives. It is the anchor. The margin lives one line down.

Power (this is the line to read twice)

Power is billed one of two ways. You need to know which one.

Committed power. You pay for a fixed amount, say 5 kW, whether you use it or not. Cost is predictable. Usually quoted as a per-kW MRC, often $180 to $325 per kW per month depending on market.

Metered power. You pay for what you draw, plus a PUE multiplier the provider sets itself. This is where bills grow without anyone noticing. Your draw creeps up, the multiplier stays high, and the line item quietly doubles over 18 months.

If your invoice says "metered power" and does not show the kWh reading, the multiplier, and the rate on separate lines, you cannot audit it. Ask for the breakdown. Every provider has it. Most do not send it unless you ask.

Cross connects

A cross connect is a physical cable between your cabinet and someone else's, usually a carrier or a cloud on-ramp.

Retail price is $150 to $500 per month per cross connect. The cable itself costs the provider about $40 to install once, and nothing to keep running. This is pure margin. Some facilities have 12,000 cross connects on their books.

You cannot get out of paying for them. You can push on the count. Audit your list. We regularly find clients paying for cross connects to carriers they stopped using two years ago.

Remote hands

Someone on site does work in your cabinet: swaps a drive, reboots a server, runs a cable. Billed hourly, usually $175 to $295 per hour, with a one-hour minimum.

Watch for two things. First, the minimum. A two-minute reboot bills as a full hour. Second, the ticket log. Ask for it quarterly. If you see charges for tickets your team did not open, that is a conversation.

Setup, NRC, and install fees

NRC means non-recurring charge. Setup fees are one time. They show up on the first invoice and should not repeat.

If you see an NRC on month four, call. It is either a mistake or a change order nobody told you about.

Cross connect loop fees and building entrance fees

Some facilities charge a small monthly fee, $25 to $75, for the physical patch panel port your cross connect terminates on. This is separate from the cross connect itself.

Not every provider bills this. If yours does and you have 20 cross connects, that is $500 to $1,500 a month for nothing.

Taxes and regulatory fees

Real taxes: sales tax, utility tax where power is passed through. These are legitimate.

Not real taxes: anything with "recovery" or "administrative" in the name. Those are provider revenue lines with government-sounding names. You can ask for them to be removed. Sometimes it works.

Where to push first

Look at three lines. The metered power multiplier. The cross connect count. The recovery fees.

Fix those and you can usually cut 12 to 22 percent off the total. We saw one client in Ashburn drop $4,180 a month by auditing cross connects and switching from metered to committed power at their real draw.

Read your next invoice with these definitions in hand. Circle the lines you cannot explain. That is your list.