The difference between dedicated servers and colocation is straightforward. Dedicated servers give you the freedom to lease or own the entire server, whereas colocation is the process of locating your servers in a third-party data center to provide a more secure and managed infrastructure.

Another significant distinction is that with colocation, you own the hardware, giving you complete control over the hardware and operating system you use, but with dedicated hosting, the service provider owns the hardware, requiring you to pay for machine updates.