internet : Commercial broadband vs. residential broadband

By Prev Info - October 17, 2022

 A question we hear from commercial broadband Internet consumers who are unfamiliar with the industry landscape is, “Why am I paying so much at the office for bandwidth? I have a 20 Mbps download broadband connection at home from the cable company and I’m only paying $40.” It’s a valid question. Pricing for business grade bandwidth that is committed to the customer and carries a business Service Level Agreement (SLA) has pricing that is vastly different than residential grade bandwidth.

In the case of a cable Internet provider, the bandwidth pipe for the home user is actually much larger than 20 Mbps. In this example, the broadband Internet service is throttled or rate-shaped to up 20 Mbps on the download and up to 5 Mbps on the upload for each home, but the source node for that bandwidth can be 100 Mbps or even much greater. It’s also true that the source node could be subscribed to as many as 200 other homes in the area, all of which could also have been offered up to 20 Mbps download. The bandwidth is oversubscribed. In other words, everyone is sharing and while it is likely that a broadband speed test will reveal that you may be getting close to 20 Mbps, there is no assurance that bandwidth will be available to any one household on a consistent basis.

Cable Internet is a “best effort” service, so there is no remedy to the homeowner if the bandwidth is not available, or if the high speed Internet service is degraded by packet loss or excessive latency. A business grade circuit has dedicated bandwidth to the business broadband customer, and assures that the service will have minimal latency and minimal packet loss. It comes with remedies for the customer according to the SLA if the business Internet service does not perform to commercial standards.

In reality, best effort service like DSL and cable Internet are more than adequate to meet the needs of some businesses. If the business just needs to do Internet surfing and email, a residential based network is a good value. But if the business leverages the Internet for productivity and enterprise applications, then it makes sense to get committed bandwidth with robust performance and a strong SLA to assure that all of the days will be productive.

One size bandwidth doesn’t always fit.

When it comes to business Internet services, companies are very diverse. The number of employees, the type of service they provide, the means by which they interact with their customers, vendors and partners, and the combination of data applications utilized all affect their bandwidth needs. It seems like no two companies are the same when it comes to business broadband. Hence, bandwidth in standard sizes doesn’t always fit. And to add even more complexities, what may fit today, may not fit tomorrow.

Many times when my sales team talks to businesses to learn about their needs, they really have no idea how much bandwidth they are using or how much they will need in the future. Unfortunately, they usually guess, and then negotiate for as much

Internet bandwidth they can get for the budget. The result is they buy to their budget, instead of to their broadband needs. So it’s no wonder that so many companies have contracted for far more bandwidth than they are using.

For businesses that want more efficiency, one option is to find a business Internet provider that has the flexibility to adjust your bandwidth, up or down, based on your actual usage.

When bandwidth is sized appropriately for the current demand and it can be quickly increased when you really need it, you’re getting the utmost efficiency and productivity. 

Businesses should really back-up their quality claims. We do.

As buyers of products, be it business or personal, we are inundated with product and company claims. We have heard it all again and again: the best, the most preferred, the number one, the fastest, the most superior, etc. All too often as we try to navigate through all the hoopla, we find that so many of these statements are nothing more than empty promises. As buyers, we think that if we spend a little more time, and dive deeper into the messaging, we’ll find some tangible proof that substantiates these claims. But all too often, we find ourselves making a purchase decision void of enough meaningful and accurate data.

When it comes to business Internet services, the desire for valid and meaningful data is paramount to decision making. Reliability, speed and throughput of your high speed Internet are all crucial to your business success. Broadband network performance stats like uptime, latency, and packet loss are key indicators of an Internet Service Provider’s service quality, and should always be examined before selecting an Internet provider.