Increase Bandwidth Without Increasing Costs

Bandwidth, especially WAN bandwidth, is in demand. Some companies treat it like a scarce resource. Why? Because bandwidth costs are expensive. While 100 Mbps or 1,000 Mbps might be considered modest bandwidth levels on a company LAN and readily affordable, as soon as you need to connect beyond your network edge the costs jump dramatically.

Here’s why that’s the case. Communications beyond the LAN have been traditionally handled by telecom service providers. In fact, these connections employ telco developed technology deployed originally for use exclusively by the telephone companies. Later, these line services were offered to businesses as computer networking and communication became popular.

In recent years, more companies have gotten into the metropolitan and wide area networking business. Most of the newest entrants have designed their core networks around the latest technologies to transport voice, video and data packets with quality of service controls. That’s not a knock on legacy suppliers, who have been transforming their networks from switched circuit to packing switching in line with the changing needs of the marketplace. However, it’s important to recognize that there is much more competition in this field than in decades past and much of it is coming from companies that don’t have huge legacy physical plants to support.

This gives you an idea on where to find immediate cost savings that you can pocket or use to upgrade your current bandwidth. If you bought your circuits years ago and simply renewed contracts as they came up or have been paying on a month to month basis, there’s a pretty good chance that you can get a better offer. How do you go about doing that? The hard way is to do a lot of looking for alternative providers and then put in lots more time making phone calls and negotiating various offers.

The easier way is to let a telecom broker, like Telarus, Inc., pull together a set of competitive quotes tailored to your business location or locations. That’s right, each location that needs service will require a separate quote process. It’s because most bandwidth services are location dependent based on facilities in place at or near that location. You may get one price, while another site across the highway may have a significantly different quote.

What ensures that you are getting the best deals you can is to have multiple carriers vying for your business and going through a large brokerage that can command the best rates from those carriers. You actually have more leverage going through a broker than winging it on your own. The broker’s commission comes out of the carrier’s sales budget, not added to your bill. If this makes sense to you, get a set of bandwidth quotes for your business needs and see what the potential savings are.

The other way to gain bandwidth at the same or lower cost than you are paying now is to switch technologies. A very popular migration right now is from traditional T1 lines to Ethernet over Copper. Both services are highly reliable, have symmetrical bandwidth that is the same for both upload and download, and are provisioned over ordinary twisted pair telco wiring that is usually already installed. The differences are available bandwidth and cost.

T1 lines run at 1.5 Mbps. You can double that to 3 Mbps by bonding two T1 lines together, but your costs double right along with the bandwidth. Ethernet over Copper offers 2 Mbps and 3 Mbps bandwidth service for about the same price as a single T1 line. This makes it easy for a company to double WAN bandwidth or dedicated Internet access without having to raise the telecom budget. In addition, EoC offers bandwidth levels of 10, 15, 20, 30 and even 50 Mbps in some areas. Bonded T1 tops out at around 10 to 12 Mbps with multiple T1 lines.

You can see that there are at least two good strategies to gaining more bandwidth without a corresponding cost increase. The first is to get competitive bids through a large telecom broker representing dozens of service providers. The second is to switch to a newer technology that offers lower costs for equivalent bandwidths. You can take advantage of both these strategies by requesting competitive quotes for available bandwidth services for one or more business locations.

Level 3 Will Light Your Building

The technology tide has turned, making Ethernet the WAN (Wide Area Networking) transport protocol of choice. It's the defacto standard for LAN networks. What makes more sense than extending your LAN to remote locations or the Internet using the same networking standards you use in-house?

Even more compelling is the cost advantage as your bandwidth needs increase. At the low end of the spectrum, T1 lines rule the roost with an average lease price around $450, dropping into the 300's in major metro areas. As a point of reference, you're paying $292.20 per Mbps for that 1.54 Mbps T1 connection, also referred to as a DS1. Moving up to DS3 service at 45 Mbps and you pay an average price of $5,000 per month. Yes, the cost has gone up more than 10 times, but the bandwidth has increased about 30 times. You're paying about 1/3 as much per Mbps, or $111.11/Mbps. Those are the going rates for conventional TDM (Time Division Multiplexing) telecom digital line services. But what about Ethernet?

Hold on to your hat. Instead of selecting a DS3 at 45 Mbps, what if you instead chose Fast Ethernet at 100 Mbps. How much more would that cost. Here's where the tide turns. Instead of costing more, Ethernet costs less. That Fast Ethernet connection will run you around $2,000 a month or just $20 per Mbps. That's over 2x the bandwidth for 5x less money.

What's going on here? Is there a trick involved? Yeah, that trick is being able to connect directly to a competitive carrier's network without having to gain access through local telephone company facilities. That "local loop" is pretty much locked in for TDM services, especially copper that is almost universally owned by the Incumbent local phone companies. Fiber optic networks are a different matter. The incumbents also own a lot of fiber. Most of it is set up for traditional TDM services such as SONET that's backward compatible down to the individual DS0 voice channel.

Ethernet is a different game. Competitive carriers set up their own POPs or Points of Presence, analogous to the phone companies' COs or Central Offices. Level 3 is one such carrier. They own over 50,000 miles of their own national network plus 24,000 miles of metropolitan fiber network. They're so big, they even sell bandwidth to telephone companies and other carriers. But they'll also sell to you at very attractive lease prices. What's more, if you're building isn't already lit for Ethernet carrier access, they may very well make the connection.

Being "lit" or wired for fiber optic WAN services is the new utility in demand. Many buildings in metropolitan areas are already lit for fiber, meaning that fiber optic cable has been brought in, terminated, and communicating via laser light wavelengths. Is your building ready? Use this fiber optic service search engine to find out.

Not lit? Don't despair just yet. Level 3 will light your building if it's worth their while. If you are within 200 feet of their network and will contract to use 10 Mbps or more of service, they'll likely hook you up. For buildings between 200 and 500 feet away, they need 100 Mbps of service committed. Out to a mile, it is still possible to get connected, but you have to pony up for something over 100 Mbps. It's likely that other tenants in your building also want high speed bandwidth they can afford, so perhaps you can pool your requirements to come up with a sufficient bandwidth commitment to get the building lit for Ethernet services. See how close Ethernet service is to you.