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Dedicated vs Shared Internet for Business
The tradeoffs between dedicated and shared bandwidth options for business broadband.

By: John Shepler

Business Internet service options can be defined by bandwidth level, but it may be more important to distinguish between dedicated and shared service types.

What is Dedicated?
Dedicated bandwidth means what it sounds like. This bandwidth is dedicated to your use and no one else’s. That may seem obvious, but the rise of shared bandwidth in recent years has muddied the waters. Why would you share bandwidth if you could have it all to yourself?

The reason is cost
Shared bandwidth options are available at just a fraction of the cost you’d pay for similar speed dedicated options. That makes some business users think twice about how much they really need exclusive use of the line. You should make this choice after careful consideration, though, and not just as a knee jerk reaction to the sticker prices. If you make the wrong decision you could suffer with a connection that frustrates employees and kills productivity.

T1 and DS3
Dedicated bandwidth was long the standard for business. Once companies migrated from low speed dial-up or 64Kbps lines to broadband, the popular telecom standard services became T1 at 1.5 Mbps and DS3 at 45 Mbps. These are repurposed telephone trunks and offer both dedicated and symmetrical bandwidth. Both T1 and DS3 have been popular for decades are still available at very reasonable prices for both point to point and Internet access.

Unlimited Usage
A characteristic of dedicated line services is that there are no usage limits. You can load up the line with continuous file transfers, like for remote data center backups, or use it lightly for email and Web access or occasional communications with remote offices. Either way, the maximum amount of data you can transfer in a month is the line rate in Mbps time the number of seconds in the month. Whatever isn’t used just sits idle because no one else can make use of it.

About Symmetry
The symmetry of the bandwidth is also important. Symmetrical means that you get the same amount of bandwidth in both the upload and download directions. This is typical for commercial telecom services. It is essential for PBX telephone trunks, but also valuable if your traffic is heavily bi-directional. Branch office to headquarters connections, video conferencing and cloud access tend to be bi-directional.

Asymmetrical / Shared
The other types of bandwidth are asymmetrical and shared. These tend to go together. Shared bandwidth became popular when residential broadband was established. Home users couldn’t afford commercial telecom lines and rarely needed that level of performance. Most Internet access is skewed in the download direction. This includes Web pages and, especially, streaming and downloaded multimedia. Email tends to be bi-directional, but the files are generally fairly small and infrequent.

Cable & DSL
The Cable and Telephone companies took advantage of the fact that few users are online all day every day to divvy up a large dedicated telecommunications service among dozens or hundreds of individual users. Each user pays a modest fee. All the fees collected go to pay the much larger cost of the dedicated high speed line that feeds all users.

Cost of Bandwidth
It is not uncommon for shared bandwidth services to offer 10 times or more download bandwidth for the same price as a dedicated line service. The upload speed of the shared service is only a tenth to a fifth of the download speed but that doesn’t generally matter if what you need is basic Internet access. The catch is that this shared bandwidth is a maximum figure. At any given time the bandwidth you measure can be all over the place. You may get 10 or 100 Mbps one minute and 1 or 10 Mbps the next. It’s impossible to predict your actual line speed because how much you get is dependent on how many other users are online and how heavily they are accessing the Internet.

Network Issues
There are a few other issues with shared bandwidth. One is network congestion. The Internet itself can become congested with too much traffic from time to time. Most often, though, it’s the access network that clogs up with too many simultaneous users. The other issue is latency and jitter. These are unimportant for file transfers, but will wreak havoc on VoIP telephony and two-way video. Geosynchronous satellite links suffer particularly high latency.

Fair Usage Limits
Also, bandwidth sharing leads to bandwidth rationing. If you look closely at the contract, even “unlimited” services have a “fair usage” limitation. If you hog so much bandwidth that it impacts other users, you may have your bandwidth throttled to a lower speed, get cut off or be charged overage fees. Cellular broadband is famous for overage charges. Satellite services tend to throttle bandwidth. DSL and Cable have much higher usage limits but may cut back or cut off your service above certain levels. None of this is experienced with dedicated line services.

Current Dedicated Services
Today, T1 and DS3 are being replaced by Ethernet over Copper and Ethernet over Fiber. These are both dedicated symmetrical bandwidth services. MPLS networks are multi-tenant wide area networks that offer better pricing for long haul connections with committed information rates and symmetrical bandwidth.

SOHO Needs
How do you choose between dedicated and shared Internet connections? It depends on how sensitive and critical your needs are. Small retail operations that only need Web access, email and credit card verification, and perhaps want to offer their customers a free WiFi hotspot can benefit from the cost savings of shared bandwidth services. So, too, independent professionals in small or home offices who choke at the prices of dedicated lines.

Enterprise Needs
Medium and larger size organizations generally go for dedicated line services. This is especially true if varying network performance affects productivity or if you use enterprise VoIP phone service, HD video conferencing, remote data center connections or cloud hosted services. In fact, for the highest performance, dedicated point to point lines and MPLS networks can ensure bandwidth, latency, jitter, packet loss and quality of service beyond what the Internet can offer.

How to Decide
How do you choose the right bandwidth option for your operation? Consider your requirements and compare a range of competitive services for cost and performance. It’s easy to do that with an automated online bandwidth finder, but be sure to get recommendations from a expert consultant also.

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