Colocation providers moving into bare metal and GPUaaS (GPU-as-a-Service) are taking on a risk their business model has never carried: technology obsolescence risk.
The AI buildout has shifted where costs sit. A decade ago, the expensive part of a data center was the building, the power, and the cooling. As of 2026, the hardware inside the racks costs more than the facility around it, and it loses value far faster.
Why colos are moving up the stack
The demand for compute is overwhelming. Everybody is looking for an energized rack of GPU servers today, not in five months.
The progression runs from powered shell, to colocation, to bare metal, to GPUaaS. Each hop carries both higher margin and higher operational risk than the one before it. Bare metal, the most popular way to buy enterprise compute, means renting out whole servers with nothing between the customer's workload and the hardware. GPUaaS adds orchestration, scheduling, and support on top.
