Business Internet Service: A Buyer’s Guide

Business Internet Services

Every business relies on internet access to improve workflow and communications. 

In fact, internet access is downright necessary for daily operations. When you have speed and reliability in your internet service, business runs smoothly. That’s what you want, right? You want to choose an internet service provider that will guarantee high speeds and reliable service all at the lowest possible price. Can you get everything you want and need?

The Basics

Business internet is an umbrella term that refers to the business internet services you purchase from an Internet Service Provider (ISP).

An ISP provides access to the internet and transmits data from internet servers to your computer. There are many ways to connect to the internet but the most common are: dial-up, DSL, cable, and wireless services. 

Business internet providers offer a slew of features to enhance business operations and communications such as:

• web hosting
• streaming video
• voice over IP (VoIP)—see our VoIP Buyer’s Guide
• video conferencing
• virtual private networking (VPN)
• bundled phone/internet service
• free domain names, web space and email addresses
• free static IP addresses
• priority network access
• priority customer support
• free antivirus and spam protection

Types of Internet Service

Residential, Small and Large Business Internet

Before you choose a plan or provider, it is helpful to understand the difference between a residential and business internet account. If you are self-employed or work from home, consider upgrading to a business account for a faster connection and more uptime (reliable service). If you are a business with a growing number of internet users and need more bandwidth, consider a dedicated service vs. a shared service.

Residential

Most residential internet accounts are shared services, meaning multiple users ‘share’ the connection with you. The speed and reliability of a shared connection will vary depending on the number of users connected at one time. For example, a residential connection is usually slower in the evenings when more users are connected to their home networks, but faster during daytime/weekday hours when most users are on their workplace network.
In summary, you can expect the following from a residential internet account:

• Shared service (multiple users on one line)
• Slow connection speed during high traffic times
• Less reliability depending on number of connected users
• Limit of downloadable data per month
• Maximum download limit
• Restrictions on running servers

Pricing for residential internet can range anywhere from $10 to $100/month depending on the provider, location (rural or urban) and selected features.

Small Business

Small businesses often purchase a plan that is similar to a residential package, but with slight differences. Like a residential connection, the internet is run over a cable line or DSL and is provided by the local cable or phone company. The difference between residential and small business plans? Improved connection speed and user reliability. That’s because you are paying for an upgraded version of the residential package.

A small business plan usually includes perks like a static IP address, a service level agreement and less oversubscription . You can expect your bill to be anywhere from $50 to $400/month, depending on the number of users, the location of your business (rural vs. metropolis) and the connection speed you want.

With most business internet accounts, you get the following:

• Unblocked ports (wider range of inbound/outbound data)
• Few restrictions on running servers
• Ability to self-host websites
• Static IP address (as opposed to dynamic IP address)
• Better tech support
• Faster technical scheduling
• Custom features such as an increased number of email inboxes, free domain name registrations, web hosting services, antivirus services for multiple computers, collaboration software, etc.

If you are self-employed, work from home or own a small business, ask your local cable/DSL providers about their business package. While it may cost you more per month, it might be worth the time and money.

Large Business

Most large businesses and corporations prefer dedicated internet access (DIA). This means that a specific amount of bandwidth is transmitted via a dedicated line solely for that business. DIA is considered one of the purest forms of internet access because the user has a direct connection to the Internet Service Provider (ISP). DIA provides 99.9% reliability of service and zero oversubscription issues. Plus, guaranteed upload/download speed is a bonus too. Dedicated accounts receive the highest priority with regards to customer service issues and technical repairs. But there is a cost. A dedicated service can run you anywhere from $300 to $5,000/month depending on your location, number of users, bandwidth, speed and rate of your ISP.
Learn more about dedicated cable and DSL services for businesses.

Bandwidth

What is Bandwidth?

Bandwidth is synonymous with data transfer rate. Simply put, bandwidth refers to the amount of data the internet connection can transfer in a certain amount of time (rate). Bandwidth is typically expressed in bits per second (bps).

Increasing bandwidth means more data can be transmitted over the internet. When you sign on with an internet service provider, you pay for a specific amount of bandwidth. The amount of bandwidth you purchase combined with the number of users and types of usage will affect quality and speed.

What’s the difference between Mbps and MBps?

Bandwidth is expressed in varying units (bytes, kilobytes, megabytes, gigabytes). Your internet service provider might use one term for bandwidth while other services may use other terms. It’s important that you understand the difference in terms and know how to calculate/convert between two units to fully understand and measure bandwidth.
Example: Your internet service seems to be running slow. You run a speed test and the speed test reading measures 5 Mbps (megabits per second). You call your service provider and they tell you your average speed is typically 5 MBps (megabytes per second). These two values ARE VERY different.

There are 8 bits in a byte. With that knowledge, you can convert the readings to show that 5 MBps is equal to 40 Mbps (5×8=40). And conversely, 5 Mbps equals 0.625 MBps (5/8=0.625). So, if your speed test results show 5 Mbps, you may have sluggish service and should check your SLA for bandwidth guarantees.

How much bandwidth does my business need?

The short answer: it depends on what you are using the internet for (web surfing vs. digital streaming) and how much you are willing to pay.
It doesn’t matter whether you have a 50Mbps or a 100Mbps connection when you are performing low-data usage activities such as email or web browsing. The quality of your connection will not be better. But bandwidth does matter if you want to perform multiple activities at the same time. For example, if you are trying to back up a computer, upload multiple large files, stream video and browse the Internet all at once, you are going to use a lot more bandwidth. Once you reach your bandwidth capacity, that’s when you will experience connectivity issues and delays.
Think of it this way: having more bandwidth is like adding another lane to the highway. The speed limit is still the same, but more cars are able to traveling at that speed at the same time.

Some factors to consider before purchasing bandwidth:

• What are your current data requirements (most common web activity? streaming video, data entry, web browsing, etc.)
• Will these data requirements change over the next 5 years?
• How many users do you currently have in the office?
• Do you plan to grow? If so, by how many users?
• How many miles between your office and the Internet Service Provider (ISP)?
• Do you want to bundle phone and data together? (can be a discounted price)
• What is your budget?

Ask your local service providers about options or consider hiring an internet service broker (link to service broker section) to help you navigate the telecom complexities.

Options

Data Connections

When choosing a business internet provider, you will also be choosing the type of internet connection that best fits your business needs.

Data connections are established via phone lines, cable lines or wirelessly.  And within these basic connection types, there are numerous options to choose from.

While dial-up connections still exist, your business needs more. This guide focuses primarily on broadbandconnections. The term broadband is short for broad bandwidth. Simply put, broadband connections refer to high-speed internet.  DSL and cable are both considered high bandwidth connections. And while DSL is a broadband connection, not all broadband connections are DSL.   Remember, there are many factors to consider when deciding on the right internet connection: availability, cost, speed and reliability.

Broadband generally refers to anything that’s faster than a dial-up internet connection. Remember, the type of internet service available to you depends on what technology local providers offer.

DSL (Digital Subscriber Line) 

DSL transmits data through phone lines without interfering with telephone service. Local phone companies typically offer DSL service, but other internet service providers offer it as well. DSL is the most common form of home internet connection today, and is also very popular for small businesses.

Note: DSL is NOT affected by the number of users who log on at once. That means it can provide fast Internet service to multiple DSL units in one office.

DSL can’t guarantee consistent internet speed. Why? The distance to the provider’s switching equipment determines the strength of the connection. So if your neighbor down the street is closer to the DSLAM, their service may be faster even though you are paying the same price.

Beware: DSL is a distance-sensitive technology, meaning the closer your business is to the service provider’s switching equipment (link to glossary), the faster your connection. Most providers recommend that your office be within 2-3 miles of their switching equipment to get fast, reliable service. Be sure to research the DSL service providers in your area to see how other customers have rated their service. If other customers report bad service, you are probably too far away from a DSLAM (link to glossary) location.

There are a few different types of DSL:

HDSL – an upgraded version of traditional DSL with very high speed internet access. Typically considered more reliable than standard DSL, but connection speed is still dependent on distance from the ISP and the age and number of copper wire pairs used in the connection.
ADSL – asymmetrical DSL does not have an equivalent download/upload speed. In many cases, the download speed can be as much as 4 times faster than the upload speed. If your business mainly uses internet service for email and web browsing, an asymmetrical connection is a great choice. But if your business relies on frequent uploads, consider the symmetrical connection.
SDSL – symmetrical DSL has equal upload/download data speeds. SDSL is especially helpful for businesses with high data needs.
VDSL – Very-high-birate DSL is a more recent type of DSL, but a strong connection relies on short distances between the internet service provider and place of business.

DSL is a good fit for your business if:

• Your office is in a high-density population area
• Your office is within 2-3 miles of the DSL provider’s switching equipment/central office
• You currently have copper wires that are in good condition
• You want an inexpensive, but relatively fast connection
• You need a highly secure connection
• You don’t need a guaranteed uptime

DSL may be an economical solution for:

Small to medium sized businesses.

Businesses that regularly download large files.

Businesses that often send emails with attachments.

Depending on the provider, business DSL packages can start as low as $30 per month for 1 MBps. Looking for more speed? 10-15 MBps packages start at $85 per month. 

Cable

Internet cable service is provided through traditional cable or fiber optic cable lines rather than phone lines (used for DSL) . IN most areas cable lines are already present so the service providers will use the existing lines for your connection. A cable modem must be installed at your place of business. Check your service level agreement because most providers lease a modem to you but you do have the option to purchase.

Beware: Watch out for oversubscription! Cable providers have been known to sell more bandwidth than is available. Many cable companies advertise faster internet than DSL, but cable internet is a shared service. That means it is only faster when there are a small number of connected users.

A cable connection is a good fit for your business if:

• You don’t share the cable channel with other users
• You don’t need a large amount of bandwidth
• You want a fast connection at an affordable price.

Business cable internet can cost anywhere between $100-$400 per month.

ISDN

ISDN stands for integrated services digital network. ISDN allows users to send data, voice and video content over traditional or digital telephone lines.  The installation of an ISDN adapter is needed. When speaking of ISDN, you will typically hear of T1 and T3 options.

T1  

A T1 connection is a dedicated, point-to-point line that provides businesses with access to the full amount of bandwidth (from 1.5 to 12 Mbps) that a service provider offers. T1 lines run over fiber optic or copper lines [link to optic v copper section] and can support hundreds of users at a time. Aside from data speed, T1 brings increased reliability over other broadband connections since service is not shared.  T1 lines cost anywhere from $300 to $1,200 per month, depending on additional features such as firewall, antivirus, and spam tracker protection that are added to the service.
Note: a single T1 connection can support hundreds of users, but the actual performance of the line will drop as more people log on.

A T1 connection is a good fit for my business if:

• you have a small or medium sized business needing an internet connection for 20-50 users
• You want dedicated bandwidth during work hours
• You want a direct connection to the provider
• You want a service level agreement that includes a guarantee of performance

Bonded T1

A bonded T1 means that you have multiple T1 lines running through a single pipeline or bond. For each T1 in the bond, the speed of the connection increases by 1.5 Mbps. So, if you have two bonded T1s, your connection speed is about 3 Mbps. If you have 3 bonded T1s, the connection speed is 4.5 Mbps. Bonded T1 lines allow you to use the full bandwidth across multiple lines. This makes for a faster connection and better performance than it would if you purchased two separate T1 lines.

Bonded T1 is usually priced at a multiple of a regular T1. For example, 3 bonded T1 lines would cost anywhere from $900 to $3,600 per month.

Burstable T1

A burstable T1 is considered a “pay as you go” service. It allows you to pay for a specific amount of bandwidth upfront, but if you go over that amount, you can tap into your ISP’s total available bandwidth. You will pay more than the standard rate (like cell phone minutes), but this is a good option if your business has predictable, yet seasonal activity.

T3

A T3 line is also known as a fractional D3. The main difference between the T1 and T3 is the amount of data they can carry. A T1 carries a maximum of 1.5 Mbps, while a T3 is known a the “big daddy” of the T-carrier system and can carry up to 45 Mbps. While the price of a basic T1 line is usually around $300/month, the price of a T3 is around $2,000/month.
It is great for medium/large businesses, as it provides a good deal of bandwidth. T2, T4, T5 all exist as well, with the higher numbers being faster, however T1 and T3 are the more common ones.

A T3 connection is a good fit for my business if:

• You are a medium to large businesses, 50 + employees
• You require dedicated bandwidth during working hours
• You are an online business that requires a secure network connection

Fiber

Fiber optic technology transmits data as light impulses along glass fibers. Fiber services such as internet, phone, and television are delivered simultaneously through one line. The appeal of fiber? It’s super-fast. At speeds of up to 1 G (1,000 Mbps), no other broadband service can compare. Fiber optic cables have a greater bandwidth than traditional metal cables. In fact, you may see You may see some T1 and T3 lines utilizing fiber technology for its guaranteed speed. Another benefit to fiber is that it can be consistently upgraded as technology improves without the need to replace the physical line.

There are different types of fiber optic connections and they are quite different. While fiber technology is extremely fast, speeds are degraded depending on the type of fiber optic connection available. Bandwidth is reduced, the farther the fiber line ends from the user.

• Fiber-to-the node (FTTN)—a node or network box is shared among multiple businesses. It can also be referred to as fiber-to-the-neighborhood since the fiber lines are brought to the end of a street to provide service for the entire neighborhood. This node will serve a few hundred customers within a radius of about a mile.  This “last mile” is the zone from the node to the house. That gap must be bridged with copper lines that finish the connection from node to user. This is the slowest type of fiber connection since the node to user distance is the greatest.
• Fiber-to the-curb (FTTC)—then node is located closer to a business or home than with FTTN. In fact, the distance is less than 1,000 feet. The fiber optic lines are literally brought to the “curb” of your home or business. Then from the curb to the business, coax cable typically finishes out the connection.
• Fiber-to-the-building (FTTB)—fiber optic cable goes to a building or shared property. From there, individual businesses will get their connection through another type of cable connection.
• Fiber-to-the-home (FTTH)—fiber is delivered directly to a business or home with either a point-to-point architecture (for large businesses) or a passive optical network (PON) for smaller businesses or homes. FTTH offers the fastest speeds since it uses the least amount of coax (metal) cabling.

Fiber is truly the next generation technology happening right now.

Beware: Fiber lacks built-in redundancy. That means when a fiber optic cable fails, all transmissions stop. The fiber line must be replaced to restore the connection. Also, fiber is not readily available in all markets. Because it is a newer technology, it lacks the established infrastructure of coax cable or phone lines.

A fiber connection is a good fit for your business if:

• You are a medium to large business
• You work requires high speed downloads and uploads
• You don’t need a large amount of bandwidth
• You want a fast connection at an affordable price.

Fiber internet can cost anywhere between $100-1,000 per month. Look for higher initial costs with both installation and activation fees. Ask questions [link to article] and read your service level agreement [link to sla section] closely.

Satellite

DSL and Cable simply aren’t available everywhere, particularly in rural areas. Broadband satellite offers an alternative internet connection to remote areas. Streaming speeds are dependent on several factors including the service provider, the package purchased, line of sight to the satellite and weather. While satellite broadband is considered high-speed, its download and upload times of .5 Mbps are significantly slower than DSL or Cable. But, they are still 10 times faster than dial-up. Maximum possible speed tops out at 15 Mbps. Additionally, satellite internet is generally the most expensive form of broadband because there is no existing infrastructure as with DSL or cable.
Note: Satellite broadband is NOT as easy to install or use as satellite TV service.

Beware: Weather and large applications like video conferencing can slow your connection. And, because satellite internet equipment is very expensive, providers typically require that you purchase equipment upfront to receive service.

Equipment can run between $800 and $10,000. After that, monthly service costs range from $50 to $100.

Wireless

Wireless broadband connects a home or business to the internet using a radio link between a customer’s location and the ISPs facility. Really, wireless refers to internet service that does NOT require a wired connection between you and your ISP. Wireless technologies can provide internet service in remote or low population areas, and is every popular with the remote and mobile workforce. Speeds are comparable to DSL and cable.

Wireless broadband can be mobile or fixed. Fixed wireless refers to a wireless device or system in a fixed location such as a home or office. For example, you may have a computer at home that connects wirelessly to you service provider, whereas mobile wireless service connects devices as you move and change locations. Most people use their mobile phone with fixed wireless at home but utilize mobile services as they go about their day. 

The bandwidth that wireless provides is not as fast as fiber or cable or DSL.

The bottom line: signals travel better through cable (or fiber or phone) lines than open air.

Look for speeds topping out at 1.5 Mbps with a monthly cost between $40 and $50.

Tips

Choosing a Service Provider

Now that you are informed of all the connection types, it’s time to decide which provider will best meet your needs.

You have two options when choosing a provider: 1) find a provider directly or 2) use an internet broker to find the best service for your business.

What is an Internet Broker Service?

Purchasing services from a telecom company can be a daunting process. An internet broker service acts as a middleman between the internet provider and the customer. The broker works on your behalf to find the right service at the best price. And, they support you throughout the lifecycle of your contract. In other words, your broker is your advocate. There is no charge to you as the internet service provider pays the broker’s commission.

What to Look for in a Service Provider

1. Availability – Depending upon where you live – in an urban, suburban, or rural area – only certain ISP options may be available to you. Urban areas have high-speed cable and fiber optic options available. Rural areas may still offer dial-up in addition to satellite and DSL choices.
2. Stability – When looking at an ISP, check the number of subscribers that company has overall and in your service area.  This serves as an indicator of the company’s stability and growth. A well-established internet provider can expand their existing infrastructure when needed.
3. Speed/Bandwidth –  How do you plan on using your internet service? Think about the number of users and their upload and download demands.  The larger the demands, the more bandwidth you will need. Advertised speeds tend to be potential speeds, not the actual average performance speed.
4. Reliability – Also known as uptime (link to glossary). Most providers aim for 99.99% uptime over the course of a year. Where’s the proof? You can request monitoring reports that track downtime. Also, ask around.  Are other local businesses happy with their ISP? Satisfied customers are a good indicator of a reliable provider.
5. Price –  There is an incredible amount of competition among internet service providers. This healthy competition keeps costs down for the user and increases the number of features and packages available. See how far your dollar can go by getting quotes [ should we link to the quote form here?] from multiple providers that compete for your business. Internet providers can tailor a package to fit your needs and your budget.
6. SLA – Know your terms of service including contract length and pricing. Be sure to read the fine print. The first year of service may be a complete bargain, but make sure you’re not then locked into a contract for too long. A reputable provider will specify levels of service, uptime and customer support. You never know when you may feel the need to change your internet service type or provider. [link to contracts section]
7. Support– Fast, helpful, knowledgeable support is critical. Your service provider should offer numerous avenues of contact—phone, email, chat. Is 24/7 tech support available?Tips

Choosing the Right Business ISP

Plan Ahead—Think about the growth and internet use of your business. If your business is quickly growing, then it would be wise to purchase more bandwidth than you currently need.
Hidden Agenda—Keep in mind that brokers who sell products like computers and routers in addition to internet access may steer you to ISPs that don’t provide the hardware as part of their service.
Lease Don’t Buy—If possible, do not purchase equipment from your ISP. Leasing equipment requires that the internet provider own, maintain, and service it as needed.
Get Support—Your access solution should at least have 24/7 tech support, and preferably have a dedicated team of experts who stand ready to support all your business needs.
Know Your Terms of Service—Read your SLA! Understand the specified levels of service, uptime, customer support, penalty provisions and pricing.

Service Contracts

Service Level Agreement: Read the Fine Print

A Service Level Agreement (SLA) specifies the terms required of both the service provider and the consumer. The contract you sign should be comprehensive, including detail on all costs and length of service. In most cases, the contract is more for the business than the customer, but as competition increases among internet service providers, they are more willing to guarantee certain levels of service to their customers. For example, many ISPs now offer guaranteed uptime of 99.99%.
Before you choose to sign an SLA with any internet service provider, consider the following:

• Are contract terms vague?
• Are fees hidden in the contract that were NOT mentioned verbally?
• What is the cost of installation/setup?
• Are you renting or purchasing equipment? If so what is the price?
• How long is the contract?
• What are the cancellation stipulations?
• Will you contract automatically renew?
• How will you receive customer support and technical support?
• Is there a guaranteed uptime? What is it? How can you find out if the number is met?

Pricing

Costs for broadband Internet access can seem steep compared to residential rates, but business ISPs must provide much greater reliability and customer support than residential ISPs do. Here’s a basic breakdown of pricing for the various broadband connections.

DSL—Prices for business DSL start as low as $30 per month and can increase to $125 per month with speeds ranging from 1 MBps to 15 MBps, respectively. Expect to pay a setup fee equal to one month’s service charge and additional charges for “bursting”-–using more than your allotted bandwidth.

Choose DSL for its affordable price.

Cable—Business cable internet runs from $100-$400 per month for shared internet services. With shared services, your bandwidth demands should be realistic.

Choose cable for its affordable price.

T1—Monthly T1 prices range from $250 to $1,500 – with a similar cost for the initial setup.
Fractional T1s run about $100-$200 per month.
Bonded T1s are typically priced at a multiple of a regular T1 line. Three bonded T1 lines range from $750 to $3,000 per month.

T3—Since T3s carry more data, they carry a heftier price tag. The price of a T3 is around $2000 per month.

Fiber—Fiber optics lines range in price anywhere from $600 to $3,000 per month. You may incur a stiff build-out fee if your office is not equipped with fiber lines. Installation costs are high and varied: $1,00 to $40,000.

Satellite—For remote areas, satellite service may be the only option. Equipment can run between $800 and $10,000, and monthly service costs range from $50 to $100.

Wireless—Mobility is the benefit of wireless service. Speeds are slower and rates are lower: $40 to $50 per month.

As mentioned earlier, the typical contract length is three years. Most business ISPs will either provide the equipment – routers, T1 pipes, Ethernet cables – for free, or tie them into the monthly pricing. Certain setup fees, including local loop charges and installation, may also be waived based on the length of a contract.

Compare: Cable vs. DSL
Cable and DSL have many similarities.  Refer to the chart below for a detailed comparison.