Co-location is a term from outsourcing
. Co-location refers to the situation when a company outsources its e.g. web server capacity to a service company. In the co-location situation, the company retains full control over its server operation, but the geographical location is no longer in the company but with the outsourcing service provider and can be, for example, in another country or even continent. The outsourcing company benefits from e.g. cheaper maintenance costs.