While many people predicted the
end of price erosion for
T1 bandwidth it continues to fall. Service providers are up
against stiffer competition and are desperate for new
customers to fill their pipes and turn a profit.
Are you ready to negotiate for a rock bottom price?
Before you do, consider a few of the reasons for the drop
in price on T1 bandwidth.
T1 bandwidth pricing reduces as companies have
out of business and the large number of telecommunications
companies are fighting for a place in a smaller market.
While many service providers did have room to lose margin,
many have come dangerously close to the edge of selling
circuits at a loss and many have gone beyond this point.
It seems that in the race to the bottom many providers failed
to learn the lesson that selling at a loss does not create a
long lasting and healthy company no matter how many circuits
or widgets you sell.
Many companies selling at a loss have already been in
bankruptcy and look like they will repeat this exercise as they
did not learn from their first go around. So, solvency of the T1
bandwidth provider should be a consideration when looking at
Another consideration in bargain shopping for T1 service is the
fact that all T1's are not created equal. Many providers are
convinced (and rightly so) that customers are focused on price
and are not concerned with quality of service.
Many providers are now oversubscribing T1 service connections
as though they were DSL connections. This means you may
not get the bandwidth you thought you would get.
Make sure when you look for that bargain price you also review
the SLA (Service Level Agreement) and make sure the contract
protects you and guarantees you will get the bandwidth to which