Are all Internet providers the same?

I've been in the telecom and IT space for 20 years now and I have watched as much of the telecom industry has become commoditized. It's not that they no longer offer quality IT solutions anymore it's that many business owners don't understand the difference between carrier grade Internet providers and regional or local mom and pop ISPs. My goal of this article is to point out a few of the differences so business owners can make better decisions and not be so frustrated with their provider.

Ten years ago, the Internet market was different. The regional ISPs were often selling wireless connections in locations where the larger carriers couldn't justify investing in more infrastructure. It was a win for the provider and for the more rural customer. Sure, there was some overlap, but the smaller ISPs were selling best effort connections with lower bandwidth. If a business had mission critical applications and required dedicated high-speed bandwidth they went to a carrier for connectivity. To a certain degree that is still true today however the market has been flooded with cheap high-speed options. Many small businesses have found they can get away with a 200mb x 20mb coax cable or wireless connection that is not dedicated because they are drawing so much bandwidth that the lower performance of the circuit is tolerable.

The problem with that is eventually those oversubscribed solutions saturate the ISPs network and performance is de-gradated more and more. But the math is still in the favor of the smaller ISP. It's still cheaper and business owners come to believe that the market for such services should be at a certain price point, well below what solid performing circuits cost. To make matters worse the carrier ISPs joined the race to zero cost for bandwidth and flooded the market with GPON services which are fiber based and very competitively priced. For a while the carriers started winning back customers because the GPON service was faster and more reliable. The main characteristic of GPON is that it uses passive splitters in the fiber optic distribution network. This allows one single feeding fiber from the Internet service provider (ISP) to multiple businesses. The carrier ISPs had one up'd the regional ISPs. They could now also sell an oversubscribed solution and theirs is on fiber.

GPON has further cemented the market rates for business internet. Customers are being offered cheaper and cheaper solutions by the new younger generation of carrier salesman. Because of this, businesses continued jumping on an oversubscription model sharing bandwidth with every other business around them. Carriers soon found they couldn't justify the same business grade support that the traditional fiber solutions offered because they were selling it too cheap and support on GPON circuits has all but disappeared.

After Covid happened the rate of digital transformation accelerated greatly. Suddenly 10 times the number of businesses were using web conferencing, VoIP and Teams. The need for reliable bandwidth has increased enormously and this is where businesses need to learn the difference between carrier grade and Tier 3 providers in order to support those bandwidth demanding services.

Comparing Carrier grade DIA and regional or local ISP Internet

What is the difference between regional or local ISP bandwidth and carrier grade fiber solutions?

• Carrier-grade DIA typically refers to high-speed, dedicated internet access services provided by large telecommunications carriers or Tier-1 Internet service providers (ISPs). These services often have a wide geographic coverage and are designed for enterprise customers with demanding network requirements backed by SLAs (Service level agreements).
• Regional or local ISP Internet services are provided by smaller ISPs that operate in specific geographic regions or communities. Internet solutions from these providers have more limited performance and scalability options, especially in areas where infrastructure investments are lower. Bandwidth may be shared among multiple customers, leading to potential congestion and slower speeds during peak usage periods.
• Carrier-grade DIA tends to be more expensive than regional or local ISP Internet services due to the higher level of service, reliability, and performance guarantees. Businesses that require mission-critical connectivity often prioritize these factors and are willing to pay a premium for them.

Let's look at a few other differences that add value to the carrier grade solution that businesses fail to notice.

1. If you have multiple locations such as an office in Salt Lake City and a second location in St George. Or maybe you have locations in Boise, Idaho Falls, Salt Lake and Las Vegas. Your local ISP that company started with doesn't offer service in such a large geographic area. The carrier can not only support all the locations they can offer a single bill, a single support model and reliable connectivity that is the same in all locations. So rather than dealing with multiple bills, multiple ISPs, different circuit types, different routers etc. like you would have with a local or regional ISP you get a consolidated predictable solution everywhere.
2. Dedicated Agent and MSP support. Larger IT solution providers who support Teams, SD-WAN deployments, desktop support, and cybersecurity will typically also offer carrier grade solutions and serve as a single point of contact for all your IT services, A local ISP will not be offer that level of support.

Tier 1 vs Tier 2 or 3

Characteristics of Tier 1 ISPs include:

1. Global Network Infrastructure: Tier 1 ISPs operate extensive global networks with points of presence (PoPs) in key locations around the world. They have invested heavily in building and maintaining high-capacity fiber-optic cables, routers, and data centers to ensure reliable and high-speed connectivity.
2. Peering Relationships: Tier 1 ISPs establish peering relationships with other Tier 1 ISPs and large networks through Internet Exchange Points (IXPs). Peering allows them to exchange traffic directly with other networks without having to pay transit fees. This helps optimize network performance and reduce latency.
3. Autonomous System (AS) Numbers: Tier 1 ISPs have their own Autonomous System (AS) numbers and control the routing of their IP addresses independently. They announce their IP prefixes to the global routing table, allowing them to reach any destination on the Internet without relying on transit providers.
4. No Transit Fees: Tier 1 ISPs do not pay transit fees to other ISPs for carrying their traffic. Instead, they rely on peering agreements to exchange traffic with other networks. This gives them full control over their network costs and allows them to offer competitive pricing to their customers.

Examples of Tier 1 ISPs include AT&T, Verizon, CenturyLink (now Lumen), NTT Communications. These providers play a critical role in ensuring the global connectivity and resilience of the Internet infrastructure.

Characteristics of Tier 2 or 3 ISP include:

1. Smaller, local ISPs that primarily provide Internet access to residential or small business customers within a specific geographic area.
2. These ISPs typically do not operate their own backbone infrastructure and instead purchase Internet transit services from Tier 1 or Tier 2 ISPs to connect their networks to the broader Internet.
3. Tier 3 ISPs may offer basic Internet access services such as DSL, cable, fiber, or wireless broadband to homes and businesses in their local community.
4. While Tier 3 ISPs may have limited network reach compared to Tier 1 and Tier 2 ISPs, they play a crucial role in providing last-mile connectivity to end-users.
5. Examples of Tier 3 ISPs include local cable companies, municipal broadband providers, and small independent ISPs serving rural or underserved areas.

The bottom line here is that there is a big difference between a carrier grade Internet connection and a local ISP Internet service. Both have their place in the market but if you are frustrated with your Internet provider. It may be that you are shopping at Walmart for something that can only be found at Nordstroms. You can still be frugal and find value with a carrier solution but when it comes to Internet connectivity you often get what you pay for. If you want to be satisfied with the performance, support and reliability of your mission critical Internet service step up to carrier grade and watch your connectivity issues go way down.