How to colocate your first server at a datacenter

It's a shallow orange vs. apples comparison, but look at the price of colocating 1/3 rack at Hetzner (119EUR). If you already own the hardware, have no need to use any advanced AWS feature, have the skills to manage it, etc.. sometimes it make sense.

For personal and/or SMB needs, it usually not worth the trouble (specially regarding skills to maintain it).

So you're right, it's becoming more and more a niche.

Firstly get your own IPs from your local RIR. Have your co-lo provider publish your routes, but they will be YOUR IPs. if you co-lo provider sucks, you can move and keep your IP space. (This is vital for email, but I recommend it for everyone).

Secondly buy a Out of Band Management card with your server (iDrac for Dell, iLO for HP, etc) these cost fairly little and will save you hours of access / remote hands. They will pay for themselves, you can even boot an ISO from your laptop over the internet. Get your co-lo provider to give you an extra uplink for this and give it a separate IP (use one of the providers range)

Thirdly consider Mission Critical support on the servers from a solid vendor (In australia I consider the enterprise vendors Dell, HP, IBM and Acer, and of those I will only use Dell or HP). 4 hour response means you don't need as much spare hardware, and you can have things fixed FAST. I have only lost 2 disks in a rack of servers over 4 years. Both had a replacement in place within 4 hours (once at 1am).

Fourthly look at a good Virtualization solution. We initially went oVirt (Open source version of Red Hat Enterprise Virtualization) but ended up migrating to VMWare. VMWare Essentials Plus costs us $15K for 3 years in extortionate australia prices and is worth every cent. It provides Backup (VMWare Data Protector), Failover, Virtual SAN, Live Migration and a heap of useful features that save huge amounts of time.

Finally if your going to grow consider getting a rack (or half / third of a rack). This will likely give you unescorted access to the data centre, and is often not that much more then a few RU of servers (depending on the DC and racking availability).

For smaller projects, the convenience of the cloud is absolutely worth the price. For a larger build - like over 10k a month in infrastructure cost the cloud starts to make less sense economically but 'colocating your first server' is not a right of passage anymore - its unnecessary and a huge waste of time.

All of the functionality/services you have to provision yourself in colo like - redundancy, backup, remote hands, environmental monitoring, hardware maintenance are just not worth figuring out until there is substantial cost savings to realize.