Colocation Contracts: Terms, SLAs, and Hidden Fees

Colocation contracts can be complex documents filled with industry-specific terminology and important commitments. This guide helps you understand common contract terms, from minimum commitment periods and early termination fees to power commit clauses and bandwidth overage charges. We break down what should be included in a comprehensive SLA, including uptime guarantees, mean time to repair (MTTR) commitments, and penalty clauses for service failures. Learn to identify hidden fees such as installation charges, cross-connect fees, IP address costs, and remote hands minimums. We also cover negotiation strategies, what terms are typically flexible, and how to structure contracts that protect your interests while maintaining a positive provider relationship.