Should you purchase wholesale VoIP from a Tier 1 or Tier 2 VoIP provider? And what are the pros vs cons?

When looking to buy wholesale VoIP there are many factors to consider. Many companies first consideration is the cost of the minutes themselves as this is a good gauge to determine the size of the provider you are dealing with. Other things to consider are the backbone network of the provider, the support they provide, the channel limitations, the quality of the voice, call set up time, latency, and even hidden fees.

One type of VoIP provider would be a Tier 1 carrier such as AT&T, Verizon, Comcast, ect. Tier 1 VoIP providers typically have their own network of hard copper lines spanning a certain area terminating to the end user. They also often will peer directly with other Tier 1 providers to increase their footprint. This allows for the highest quality of voice and reliability. Tier 1 providers usually have large volume requirements to send traffic over their wholesale VoIP network. Their pricing usually ranges with the potential customers traffic type and volume.

Another type of VoIP provider would be a Tier 2 carrier such as XO, Time Warner, IDT Corp., ect. Tier 2 VoIP providers typically are interconnected with one or more Tier 1 VoIP providers. Tier 2 providers can even have their own local network that reaches to their end users. The quality of service provided by a Tier 2 provider is often comparable to that of a Tier 1 provider. Tier 2 providers mostly focus on servicing small to medium sized businesses (100 – 999 employees) and typically do not have volume requirements to access their network. Depending on volume Tier 2 providers will openly negotiate and cater rates to the customer’s requirements.

Making the final decision on which provider you will use can sometimes be a daunting task. Below is a list of Pros and Cons that may help you in that decision. Star Communications has helped many companies through this process. Typically we are able to negotiate better rates and offer additional services that assist our partners in choosing the right solution. Starcom has helped well over 100 companies through this process. Large Call Centers, VoIP providers, CLECs and many other types of businesses have benefited from our services. If you’d like to speak to one of our representatives about your wholesale needs and expectations, shoot us an email at sales@starcompartners.com or call 1-877-519-8464

 

 

                                Tier 1                                                                        Tier 2

Pros Cons Pros Cons
Direct Network via hard copper lines Often more expensive Multiple Tier 1 ULCs for better Back-up Smaller network
Reliable Prolonged Setup (could take months) Often better pricing Smaller budget with fewer employees (support, sales, ect.)
Highest Capacity Network outages affect all customers Quick set-up Channel limitations
Secure   Secure Could have local connection issues due to Tier 1 provider going down
Quality Voice   Quality Voice  
Low latency   Low latency  
Scalability   Scalability