Internet / Networking / IT Purchase Process

What does Dedicated Internet (DIA) bandwidth typically cost?

Dennis Thankachan
Everybody knows it. The telecommunications industry has almost 0 price transparency.

Getting a dedicated internet (DIA) price is a multi-day (sometimes multi-week) exercise that requires several phone calls and emails. Carriers treat their pricing like it’s their baby, even though what they’re delivering is commoditized internet connectivity at the end of the day. For an inexperienced buyer, this dynamic makes it hard to know if a price you’re getting is “good” per se.

That’s why we started Lightyear (I’ll provide more on us later). After serving users thousands of price quotes for services ranging from connectivity to SD-WAN, we’ve decided to share what we’ve seen over the past 9 months across DIA and best efforts internet pricing to help guide our users through their next connectivity purchase.

Before we share data, a few notes on our data set / process:
  • Our data set includes ~1,000 quotes served over the past 9 months and has been scrubbed for outliers (ridiculously high / low prices)
  • We partner with hundreds of providers and our data set includes connectivity quotes from all major carriers, and many regional carriers as well
  • Quotes are distributed all around the US, with no heavy regional bias. However, they do typically fall in urban areas.

Get to the point. What does DIA typically cost?

See below for a chart summarizing average costs, the highest cost observed, and the lowest cost observed across various bandwidth tiers.

dedicated internet pricing per mbps

A few observations are worth noting here.

Best effort connectivity is pretty cheap. This is expected. For those unaware, “best effort” connections are your typical broadband connections where bandwidth quoted is a non-guaranteed best case.

Dedicated connections cost a lot more (which makes sense, as they mean real capex and higher support expenses from the provider), but also differ quite a bit in price as you go up in bandwidth. However, you’ll notice that price doesn’t scale with bandwidth. The 500Mbps average price is less than double that of 100Mbps, and the 10Gbps price is ~2.5x that of 1Gbps.

The high and low observations are abnormal cases and should not be expected, but it is good to know that there is huge variance in what you’ll see. As a guide, any DIA circuit at 100Mbps or above at sub-$1k / month is not a bad price. Factors that’ll influence local pricing at a specific location will be provider competition (DCs with lots of providers for example tend to see cheaper pricing), cost of construction (lit buildings are always cheaper), and the provider themselves. Comcast and Verizon tend to be on the expensive side in almost all cases, while providers like Pilot are cheap wherever they’re on-net.

Has Covid-19 impacted pricing at all?

We calculated average prices before and after 3/1/2020 to see if Covid-19 impacted average pricing at all, and unsurprisingly you can see a small dip in average pricing post-Covid.

Not displayed in the data below are the huge number of promos we’ve seen from providers amid Covid.

mrc dia pricing per mbps

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