"It is in situations like this summer's Code Red
pandemic that the true pros and cons of server colocation come out.
If you want to provide some public Internet services like Web,
CVS, chat, or Usenet very often it is a better choice to have your
private Linux or FreeBSD box running at a colocation provider. In a
typical colocation service agreement, the data center staff does
not have your root password (well, they shouldn't, but if you use
unsecure protocols like FTP, telnet, and such, be assured they will
sooner or later.) You are in charge of setting up and maintaining
your server, and just about the only thing you can ask the data
center staff to do is power-recycle your computer for you. On a
typical Linux or FreeBSD box you will never get to the point of
requiring a cold reboot (with a certain other OS, on the other
hand, you will have to reboot often and that rules it out as an OS
suitable for colocation).
The main advantages of colocation are very high and affordable
bandwidth, professional data center administration (24/7 staff
presence, UPS, building access security, air conditioning and
sprinkler systems), and obfuscation of your real ISP connection to
the Internet. What I mean by that is that if your web server is
colocated somewhere, you are less likely to be DDOSed or hacked
because crackers will try to attack you where you are most visible.
Even if crackers manage to enter your web server, they are not
inside your network where your sensitive data is."