Rex says
Money math without the spreadsheet headache. Plug in your numbers and I'll show you exactly where the dollars land.
Try a scenario
Click to load — tweak from there.Inputs
Result
Lower TCO option
Colocation
Savings of cheaper option
$44,000
Total cloud cost over horizon
$648,000
Total colo cost over horizon
$604,000
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How to use this
- 1Enter equivalent cloud monthly cost ($).
- 2Enter upfront hardware cost ($).
- 3Enter colo fees (power, space, network) ($/mo).
- 4Enter fractional fte for ops.
- 5Enter fully loaded fte cost ($/yr).
- 6Enter comparison horizon (years).
- 7Read your lower tco option on the right — it updates as you type.
- 8Hit Share to keep the scenario or send it to someone.
About this calculator
Cloud vs colo comparisons usually get skewed because cloud pricing is quoted as pure opex while colo comparisons forget to include the hidden costs — hardware refresh, rack space, power, bandwidth commits, and the staff time to run it. This calculator builds both sides fully: cloud cost as a flat recurring monthly fee, and colo cost as amortized hardware capex plus monthly recurring colo fees (power, space, cross-connects) plus a fractional headcount cost for hands-on-glass and hardware lifecycle work. Over a 3-year horizon it shows total cost for each path and the crossover point. The realistic finding for most mid-size workloads is that colo wins on raw compute-per-dollar once utilization is high and stable, but the operational staff cost is what actually erases the advantage — teams that model colo without adding at least 0.25-0.5 FTE per rack routinely underestimate colo TCO by 20-40%.
Worked example
Using the values the calculator loads with:
Inputs
- Equivalent cloud monthly cost: 18000 $
- Upfront hardware cost: 250000 $
- Colo fees (power, space, network): 4500 $/mo
- Fractional FTE for ops: 0.4
- Fully loaded FTE cost: 160000 $/yr
- Comparison horizon: 3 years
Results
- Lower TCO option: Colocation
- Savings of cheaper option: $44,000
- Total cloud cost over horizon: $648,000
- Total colo cost over horizon: $604,000
What each field means
Inputs
- Equivalent cloud monthly cost ($)
- The equivalent cloud monthly cost used in the calculation, measured in $. Starts at 18000 $ so you have a working example on load.
- Upfront hardware cost ($)
- The upfront hardware cost used in the calculation, measured in $. Starts at 250000 $ so you have a working example on load.
- Colo fees (power, space, network) ($/mo)
- The colo fees (power, space, network) used in the calculation, measured in $/mo. Starts at 4500 $/mo so you have a working example on load.
- Fractional FTE for ops
- The fractional fte for ops used in the calculation. Starts at 0.4 so you have a working example on load.
- Fully loaded FTE cost ($/yr)
- The fully loaded fte cost used in the calculation, measured in $/yr. Starts at 160000 $/yr so you have a working example on load.
- Comparison horizon (years)
- The comparison horizon used in the calculation, measured in years. Starts at 3 years so you have a working example on load. Accepted range: 1–7 years.
Results
- Lower TCO option
- Returned as a plain value and shown as the headline result. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
- Savings of cheaper option
- Returned as a money amount in US dollars. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
- Total cloud cost over horizon
- Returned as a money amount in US dollars. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
- Total colo cost over horizon
- Returned as a money amount in US dollars. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
FAQ
What's usually missing from a naive colo TCO estimate?
Hardware refresh cycles (servers age out in 4-6 years and need replacement capex), bandwidth overage fees, spare parts inventory, and the on-call burden of hardware failures at 2 a.m. that cloud abstracts away entirely. Add a 10-15% annual maintenance/replacement reserve on top of the upfront hardware cost if your horizon exceeds the hardware's expected lifespan.
Does this favor cloud or colo by default?
Neither — it's a straight cost comparison and the right answer depends entirely on your utilization pattern. Steady, predictable, high-utilization workloads (like a stable database tier running near 24/7) tend to favor colo or reserved cloud capacity; spiky, unpredictable, or fast-growing workloads favor cloud's elasticity even at a cost premium, because the alternative is over-provisioned idle hardware.
Should I include the migration cost of moving to colo?
Yes, as a one-time addition to the hardware cost input if you're migrating from cloud. Data migration, rack-and-stack labor, network redesign, and the parallel-running period where you pay both cloud and colo bills typically add 5-15% to first-year colo cost and should not be ignored when judging payback time.
Accuracy and limitations
- Results are estimates before tax, fees, and inflation unless an input explicitly covers them.
- Rates are treated as fixed for the whole period — variable-rate products will drift from this projection.
- This is educational maths, not financial advice. Check anything contractual with the lender or your accountant.
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Cite this calculator
Writing about this topic? Grab a citation — every link helps keep these tools free.
RevenueLab. (2026). Cloud vs Colocation TCO Calculator. Retrieved from https://www.revenuelab.fyi/toolbox/cloud-vs-colo-tco
<p>Source: <a href="https://www.revenuelab.fyi/toolbox/cloud-vs-colo-tco" target="_blank" rel="noopener">Cloud vs Colocation TCO Calculator — RevenueLab</a> (2026).</p>
Source: [Cloud vs Colocation TCO Calculator — RevenueLab](https://www.revenuelab.fyi/toolbox/cloud-vs-colo-tco) (2026).