Monday, February 26

Determining Factors in the Cost of Your Internet Connection

Man is checking whether his laptop has fast and reliable internet access.

In an online business, fast and reliable internet access is essential for success. Using the Wi-Fi in a coffee shop or hotel can be okay in certain situations for remote working. However, it’s much more reliable to have dedicated internet access (DIA) through a high-speed internet connection.

How does one determine the available options and how much they cost? This article helps understand all factors that affect the cost of dedicated internet access to choose the best option according to business needs.

Point-to-Point and Multipoint Access

Point-to-point (P2P) is a direct connection between two locations, while multipoint (MP) connects multiple locations to a central site. The access needed will impact the bandwidth and internet speed, affecting dedicated internet pricing.

For example, P2P connections have faster speeds and are more reliable than MP connections. P2P is usually more expensive than MP because it has higher up-front costs. On the other hand, MP can be cheaper than P2P because it’s more scalable and uses less bandwidth per client.

When running an application that requires a lot of bandwidth, like video conferencing, then MP is preferable. If the application doesn’t require high bandwidth, then P2P may be more cost-effective. In addition to choosing the suitable access level, consider how much capacity your network needs at any given time and the peak periods.


Regarding dedicated internet access, the connection quality is the determining factor in how much a company pays. The larger the order, which is more bandwidth or connections, the cheaper it will be per unit.

Some internet providers offer monthly billing cycles with no long-term contract commitment providing the flexibility to adjust plans based on usage changes. Being far from the provider’s point of presence in a given city means higher costs to cover remote installation and maintenance costs.

The budget also differs when a business wants broadband service only or if the company would like a high-speed business DSL line. For example, a business located outside of Detroit but inside Ann Arbor needing both services makes the order less expensive than if located outside of Ann Arbor.

A Suitable Network Type

A small business with just a few employees may only need a Local Area Network (LAN) may be all you need. A more significant company or one with remote employees may need a Wide Area Network (WAN).

WANs can be more expensive to set up and maintain, but they offer greater flexibility and scalability. For example, moving data between LANs and WANs is easier than within LANs.

IP Transit, MPLS, and Dedicated Circuits

IP transit, Multi-protocol label switching (MPLS), and dedicated circuits broadly impact DIA costs. IP transit is the cost of carrying traffic from the business network to the service provider’s network. IP transit is a per-megabit price that’s usually charged monthly.

MPLS is a private connection that allows you to exchange data with other MPLS customers connected to the same service provider. It includes point-to-point communication between two sites within a single service provider’s Autonomous System (AS).

Businesses can configure MPLS as either switched or permanent connections. Switched connections are typically provisioned for one year, while permanent links get provided for an indefinite time. The switched connections are cost-effective.

Dedicated circuits offer private communications at high speeds. These circuits are efficient when bandwidth requirements exceed what traditional MPLS or IP Transit options offer. These circuits have higher initial costs but may provide better ROI when bandwidth needs grow significantly over time.

Internet Usage

The amount of data used each month impacts the cost of dedicated internet access. A company that holds many online meetings or downloads large files needs a plan with higher data limits. A running business requires a high connection quality to send and receive large files.

Businesses going online for the first time often purchase higher bandwidth packages. These packages require more technician visits and costly equipment to upgrade the networks to provide sufficient speed.

Wireless Internet

Wireless internet, also known as Wi-Fi, is one of the most popular internet connection types. It’s convenient because it doesn’t require any cords or cables. Instead, data gets transmitted through the air via radio waves. Wireless internet requires a router for transmission.

A computer with only an ethernet port will need an adapter to use with your modem so the modem can receive the signal from your router.

Internet Speed

The amount of payment and the type of connection determine the internet speed of a business. Some activities, such as browsing the web or checking emails, don’t need as much speed as downloading large files or holding virtual meetings. The actions in an organization determine the internet package to utilize.

Wired connections offer faster speed than wireless connections. However, the wired connections require running cables through walls which can be expensive and difficult to set up for some customers.


The protocols and security measures put in place by a business determine the cost of dedicated internet access. A more complex system is more expensive to maintain. A robust system saves money in the long run by preventing downtime and data breaches.

A standard SOHO router may be sufficient for your needs for an organization if you have few employees. An office with multiple employees looks for robust security options that usually include multi-factor authentication, device control, password management, or two-step verification. As such, it’s best to invest in enterprise-grade routers that provide these features.

Managed Service Provider vs. Self-Service Provider

Managed Service Providers (MSPs) offer higher customer service and support. MSPs also come with a higher price tag. Self-service Providers (SSPs), on the other hand, are typically less expensive but may not offer the same level of service and support. as an MSP.

Your choice of provider will depend on your needs, budget, and preferences.

Wrapping Up

Dedicated internet access provides a strong foundation for running a business. It’s essential to consider the type of network used, location, and provider. Reliable internet access is vital for small businesses to run efficiently, especially since it is key to a company’s efficiency and productivity.

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