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A T-1 line actually consists of 24 individual channels, each of these channels supports 64 Kbits per second. Each 64Kbit per second channel can be configured to carry data or voice transmissions.
A T1 connection is sometimes referred to as a "dedicated service" as the service is delivered to and from the customer premise from the CO (Central Office) without combining it with other traffic.
A T1 connection is established by providing a loop or wire from the user premises to the CO where the service provider has equipment. Part of the cost of a T1 is the loop charge or the monthly rental fee for the wire that is rented from the local phone company.
T-1 lines are a popular leased line option for businesses connecting to the Internet and for Internet Service Providers (ISP's) connecting to the Internet backbone.
The Internet backbone itself consists of faster T-3 line connections.
Shopping for T1 lines is not easy. You perform a search in your favorite search engine and you see millions of pages, all of which claim to save you money.
They create simple HTML forms that look like they have been programmed by a seventh grade student which captures your information, and either sends it to every vendor in the universe or some in-house former used-car salesman who will sell you whatever will pay him the biggest bonus.
A T1 Line and DSL connection both offer bandwidth at high speed but there are factors that greatly differentiate them from one another. These factors are price and reliability.
Depending on your location and T1 provider availability, a fractional T1 will normally be priced between $250.00 and $750.00. A T1 is more expensive than a DSL connection but is much more reliable.
DSL is a quick and cost effective method of acquiring high speed bandwidth however it is not intended to support commercial applications or large numbers of users like a T1 connection.
Like most telecommunications services DS3 prices (commonly known at T3) have been falling for the last few years. This is due to several factors. Competition has been heating up since deregulation in 1996. The number of companies offering service has exploded. With more competition in the marketplace service providers have to reduce their prices to attract customer and keep them from going to competitors. Service providers are desperate to keep margins but even more desperate to keep adding customers. This competitive arena has created a buyers market for DS3 lines and pricing is as favorable as it has ever been!
The soft economy and crash of the stock market has also contributed to the reduction in ds3 price. Since the peak of the market in 1999 many companies have gone out of business and no longer require service. This means there's a smaller pie available and there are plenty of telecom providers trying to get their share. Once again, the buyer is in control and can shop until he or she finds the price that is right for them.
A final reason for the reduction in DS3 pricing is the fact that equipment costs and the cost of supplying the bandwidth have decreased. This means that companies can supply the bandwidth at a lower cost. As bandwidth usage continues to increase as a result of bandwidth hungry applications like video on demand and graphic heavy applications the price of bandwidth will continue to drop. The only factor that seems likely to inhibit prices from falling much further is the "last mile" or the connection from the users premise to the service providers' POP (Point of Presence), but we'll save this issue for another article. Until then, enjoy those affordable DS3's and good luck finding a price that's right for you!
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