Ethernet and Fiber Prices Plummet 50 Mbps for Less than $2,600 Per Month

by Bruce Judson

April 20th, 2011

As concerns about the future of the economy continue to loom, there is one piece of positive news for businesses. High capacity, Ethernet and fiber-based broadband is now more affordable than ever. Over the past few months, changes in market conditions and the further roll-out of new technologies means that prices on T1 high bandwidth business grade broadband lines have dropped across the country.   

As recognized by the seven billion dollar federal rural broadband initiative (part of the stimulus package),  high speed broadband access "spur(s) investments in technology and infrastructure, and provide(s) long-term economic benefits."  For businesses of all sizes, the impact of these lower prices is simularly positive. Businesses have an oppotunity to cut costs substantially by investigating lower cost options for T1's, or to enhance their effectiveness by investigating whether their current monthly budget could actually double or triple the speed of their connection to the Internet.

The central Internet connection for most small to medium sized businesses is a T1, which offers a dedicated connection of 1.5 Megabytes (M) down from the Internet and 1.5M up. At the start of the year, it was rare to see a T1 connection priced below $300 a month with no installation fee and no equipment fee. Today, our estimates show that T1's with a three year contract are available for $279 or less in 70 to 80% of the nation. Prices for shorter term contracts are higher, but not necessarily substantially higher.

For businesses, these price drops are first a potentially significant and easy area to cut costs. Over the past few weeks, our T1 Anywhere site information request site has received a large number of inquiries from businesses that are paying $600 or more per month for T1 service that is now available for less than $300 a monht, a savings of more than 50% approaching $4,000 per year. For companies with bonded T1's (two T1's put together for double the bandwidth) the savings are double, or almost $8,000 per year.

Moreover, businesses with existing T1's can easily swap out old high-cost services for new low-cost services. In past years, many business customers experienced unexpected difficulties in the installation of a T1. However,  when a site already has a T1 installed, the same site is unlikely to have any problems replacing an older connection with a new one.

Similarly, Ethernet (even higher bandwidth broadband services) delivered over copper lines has now come of age, with prices for 3.0 Megabytes (M) up and 3.0M down often below $400 per month for three year contracts, with no equipment fee and no install fee. This next generation form of high speed broadband for business is quickly becoming the affordable standard for businesses of all sizes.

The net result: Businesses of all sizes should be looking hard at their current broadband connections. In all likelihood, a high quality alternative with a lower cost and greater capacity is now available.

Bruce Judson is the founder of Speed Anywhere, Inc. and the bestselling author of multiple books on using the Internet for business success.