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Internet / WAN Circuit Buying Trends: What Bandwidth Tiers are Enterprises Buying in 2024?

In this blog post, we'll scour tens of thousands of Lightyear internet / WAN circuit quote data points to evaluate trends in enterprise circuit purchases.

internet wan circuit trends
Matt Pinto

Jun 11, 2024

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Lightyear has been helping enterprise users with their telecom procurement needs since 2019. The Lightyear platform warehouses industry data gathered throughout the quoting and installation process and then makes smart use of the data to ensure that the platform users are getting a fair deal for the telecom services they’re procuring. 

While no one has a crystal ball, the depth and breadth of our industry experience gives Lightyear insight into potential trends that arise within telecom. Today, our blog cracks open some of the data garnered in the back end of the Lightyear platform to dive deeper into the enterprise WAN circuit buying trends we’ve observed. This couldn’t have happened without the outstanding proficiency, dedication, and skills put into this behind-the-scenes work by the Lightyear engineering team, especially Danny Bushkanets.

There are so many insights that can be gleaned by reviewing industry data that a single blog post won’t even scratch the surface – but our expert-backed data and industry-experienced “interpreter,” Matthew Pinto, is here to give you the basics about the bandwidth tiers enterprises like yours are buying in 2024. We’ll kick off by crunching some data and uncovering the true facts. Then we’ll put that industry expertise to work to turn that data into meaningful insights. Let’s get to it!

Lightyear’s Data: Diving into the Facts

As we mentioned above, Lightyear has been helping enterprise users with their telecom procurement needs since 2019, covering a broad spectrum of procurement issues, including the following.

  • Internet

  • Point-to-Point

  • SD-WAN

  • MPLS

  • Wavelengths

  • Dark Fiber

  • Direct Cloud Connect

  • SIP

  • hPBX

  • UCaaS

  • CCaaS

  • Colocation

  • Data Centers

In this blog, we’ve crunched that juicy data from the following key bandwidth-related services.

  • Internet

  • Point-to-Point

  • MPLS

  • Wavelengths

  • Direct Cloud Connections

We wanted to see what bandwidth tiers the Lightyear platform users are most interested in, particularly regarding quotes and pricing, so we extracted data from 15,000 recent RFP questionnaires that were submitted to generate those quotes in these areas. 

Why 15,000? Well, you must draw the line somewhere, right? Well, primarily because 15,000 gives us a good idea of recent trends without feeling like we’re pulling from too small a pool of data to draw conclusions. However, we’re certain that this massive pool will have the insights you’re looking for on recent enterprise WAN circuit buying trends. 

To help you better conceptualize the results, we’ve included some handy bar and pie charts using peg counts with this blog, demonstrating what our platform users are most interested in.

pricing requested
pricing requested 2

Did you notice that of the 15,000 pricing requests considered, 26% (3,905) were focused on the 10 Gbps bandwidth tier? A further 14% (2,168) were focused on the 100 Mbps bandwidth tier. So, we already have some idea of what bandwidth tiers are most interesting to enterprise buyers. Why stop there? 

The following two graphs show recent circuit procurements through the Lightyear platform. Of those 15,000 potential procurements, we see 5,211 circuits procured. This highlights another important consideration – when people are “shopping around,” not everyone will commit to a purchase. Some want to see if the service they are interested in even exists in their area, while others may want the pricing data to ensure they make fully informed procurement decisions. It’s a natural part of the business buying cycle.

Let’s look at those committed buyers in more depth.

procured bandwidth
procured bandwidth 3

Roughly 4% (209) of procurements were for the 10 Gbps tier, while 26% (1,348) were for the 100 Mbps tier.

But that’s just numbers. What insights can we glean? What are the 2024 trends in enterprise bandwidth tiers and enterprise WAN circuit buying?

Unpacking the Data: What the Facts and Figures Say

Trying to predict or interpret any data into something as mercurial and changeable as trends is always a matter of assumption, but here is what our experts take from the data.

Perhaps the first thing to note is a major discrepancy between the interest side of the equation and confirmed procurements. While 10 Gbps had the highest level of interest, it was the lowest for actual procurement.

Some of this could be a simple case of “window shopping.” Enterprise businesses want to know how much 10 Gbps costs. The Lightyear platform makes it easy for them to see the actual cost without investing too much time into the exercise. However, we can also see a distinct interest in increased speeds. Once Lightyear platform users have the data and see the difference in the actual cost of ownership, they use the data to make the best procurement decisions and factor in other variables like their utilization. Oftentimes, they may realize they have the scope to go bigger and opt for a higher bandwidth tier in the end.

Our data showed several sub-10 Mbps circuits being procured, though. There are a few possible reasons. 

  • After the questionnaire is submitted and the enterprise’s procurement folks have the data, they need to make real, informed decisions and often negotiate down to 10 Mbps.  

  • Remember, just because Lightyear Platform users submit a questionnaire for larger bandwidth (like 10 Gbps), it doesn’t mean that it’s available in their area.  Keep in mind that the questionnaire simply allows the platform user to request a quote for the service.  

  • Often, 10 Gbps questionnaires are submitted and used as a method of validating serviceability as they are for obtaining actual pricing. If a Lightyear platform user submits a questionnaire for 10 Gbps and that speed isn’t available, the platform will return a “no bid” response.

Since the level of attention is clearly slanted up and right as it pertains to bandwidth amounts, we can make an informed prediction that the market is merely waiting for availability and pricing to align with each enterprise business’ procurement cycles. Basic supply and demand concepts are in action here. The demand/potential customer’s interest levels are clearly pointing to bigger bandwidth tiers. However, these can be in short supply, and even where they are freely available, the cost may be seen as prohibitive or not worth the speed increase within the business environment. 

Stepping Outside Lightyear: 2024 Bandwidth Tier Trends for Enterprise

This aligns with wider industry trends other experts have identified. Enterprises are increasingly opting for higher bandwidth tiers compared to previous years. A key part of this growing demand is the bandwidth-intensive applications that are now business staples. Think of video conferencing, cloud computing, and data analytics – cornerstones of the modern business environment. This trend will likely grow with time, especially as running interconnected devices becomes more normalized in the workplace. 

Additionally, there’s a notable uptick in enterprises purchasing gigabit and multi-gigabit WAN circuits. Mostly to support this rapidly expanding, business-critical digital infrastructure. Faster data speeds are needed to accommodate this proliferation of high-definition multimedia content and real-time collaboration tools. Again, this trend is likely to grow with time, especially as remote and hybrid workplace structures become more firmly entrenched. 

We cannot ignore the growth of SD-WAN (software-defined wide-area networking). This phenomenon has considerably reshaped the existing WAN landscape, allowing businesses to optimize their network performance and boost security, often at a reduced cost. Hence, there’s a growing interest in flexible, scalable bandwidth options, where enterprises can dynamically adjust their bandwidth allocation as mission-critical applications require. This pairs with a growing trend of hybrid WAN deployments, such as running traditional MPLS circuits alongside broadband internet connections. These kinds of hybrid deployments allow businesses to leverage the reliability and security of MPLS for mission-critical applications while utilizing cost-effective broadband connections for non-sensitive traffic.

This aligns with a new trend that is likely to get more attention in coming years – burstable bandwidth. A type of pay-as-you-go model, this allows enterprises with fluctuating usage patterns to scale bandwidth up or down based on demand and reduce overprovisioning, which can happen with fixed bandwidth circuits.

While these are general trends we’ve seen in the telecom industry, it always bears mentioning that bandwidth adoption trends vary by region, influenced by factors such as infrastructure development, economic conditions, and the wider regulatory environment. Higher bandwidth tiers appeal most to mature markets, like the US, Canada, and Europe. For emerging markets, however, there is still a game of “catch-up” to play, with rapid digital transformation initiatives taking the wheel. After all, there are noted challenges to procuring business bandwidth in remote and rural areas.

There you have it! We’ve reviewed the data from Lightyear’s platform specifically, identifying some key trends. As you can see from our wider trend analysis, this aligns closely with the global trends we’re seeing in bandwidth in the telecoms industry, identifying a few key growth areas. 

Remember: the Lightyear Telecom Operating System was created to be the “easy button” for telecom procurement at the enterprise and business level. If you’re looking for a streamlined and user-friendly platform to aid your telecom procurement cycle, why not give Lightyear.ai a try? Our helpful team is on hand to answer your queries and concerns, too.

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