Colocation pricing is a black box. Providers do not publish rates. Every quote comes with an "it depends" and a sales team ready to wear you down.
Here are the real numbers for 2026. Use them to know if your quote is a steal, fair, or a walk away.
First, know what you are buying
Retail colo includes power in the price. You pay one rate per kilowatt, and the operator covers the electric bill.
Wholesale does not include power. You pay the utility rate directly through the operator. Wholesale usually starts around 250 to 500 kilowatts of total power. Most small businesses are retail buyers.
The rest of this guide is about retail.
The per kilowatt benchmark
Price is quoted per kilowatt of power. That is the number to compare.
In a tier one carrier hotel metro, expect $550 to $600 per kilowatt. Think Northern Virginia, Miami, or Dallas. These sites sit next to every major carrier and cloud on ramp. That access is why they cost more.
In a tier two market, the same footprint runs closer to $300 per kilowatt.
A single cabinet with a standard 208 volt, 30 amp power whip caps out around 5 kilowatts. So a cabinet in a tier one carrier hotel can run $2,750 to $3,000 a month in power and space alone. In a tier two market, closer to $1,500.
Steal, fair, or walk away
Here is the quick read:
- Steal: at or below the low end of your market tier, with a 3 percent escalator and cross connects under $300.
- Fair: mid range for your tier, a 5 percent escalator, cross connects at $350.
- Walk away: tier one rates in a tier two market, a 5 percent escalator they will not move, and cross connects at full list with no volume break.
Prices are going up, and here is why
Electricity costs have climbed fast. Operators are raising rates and padding margin to protect themselves over a three to five year term.
That is normal. What is not normal is an increase that runs ahead of the power math. If your utility went up 2 percent and the operator wants 7 percent, ask them to show their work.
It is a seller's market
Space is tight right now and it moves fast. That means less room to negotiate than a few years ago.
You can still push. Expect 5 to 10 percent off power and rental fees. Push the escalator from 5 percent down to 3 percent. And push hard on cross connects, which carry the fattest margin on the whole bill.
Know the numbers before you walk in. A provider can tell within a minute whether you know what a fair rate looks like. That alone changes the deal.
Related colocation guides
→ The cross connect racket: why you pay $375 a month for a cable → Your colo renewal is rigged. The fix is a 12 month head start
Paying too much for connectivity too? Run a free DIA price check and see what a fair rate looks like in your market.