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What is a leased line?

A leased line is a high-speed communications link that is dedicated to one business customer and can be flexibly configured to offer various Voice and data services including high-speed internet access.

A leased line consists of a dedicated fibre optic (or copper) cable that physically links two sites and is separated from general public telecommunications Networks.

In return for a monthly fee, which depends on the distance of the connection and the desired speed, the business has exclusive use of the communications link for the duration of the contract.

Today, leased lines are often used to offer a "business-class" Internet service with higher speeds and less congestion than consumer-grade internet access technologies can provide.

Another popular use of leased lines is to provide high-speed private Voice and data connections inside a geographically-dispersed organisation.

For example, if a company has its head office in one city and a regional office in another, the two sites would typically be connected by a leased-line to create a single Network.

UK providers or leased-line services offers speeds from 2 megabit/s to 1 gigabit/s, or more in some cases. Businesses need to ensure that they choose the optimum bandwidth for their leased-line connection taking into account not just current needs but the likely growth in required bandwidth in the foreseeable future.

A big advantage of a leased-line is that the contracted speed is guaranteed and never drops, unlike consumer-grade internet services, where there can be significant differences between the quoted speed and the actual speed obtained in real-world conditions.

This is because, unlike a leased-line, consumer-grade internet services are "contended" connections, which means the bandwidth is shared among several users and, at peak times, the bandwidth available to each user can drop.

A leased line always delivers the same speed, even at busy times, which is important for businesses that depend on their communications Network to run their business. Users can be frustrated if the computer systems run slowly at peak times, which can also have a negative impact on customer experience.

IF a company wants to host a website on its own Network, it makes sense to use a leased line to connect the website to the public Internet. That's because a leased line is "symmetrical", meaning it offers the same speed for both uploading and downloading data, unlike consumer services, which are "asymmetric", meaning they have much slower upload speeds.

As well as the speed of the link, there are other factors to take into account when choosing a leased-line supplier.

Availability is particularly important for businesses that run 24 / 7 e-commerce operations or need uninterrupted access to their IT systems for their users.

Suppliers of leased-line services specify a maximum down-time allowed for in the Service Level Agreements, which oblige them to pay customers financial penalties if the contracted down-time is exceeded. Another important contractual consideration is how quickly the supplier promises to fix a fault if one develops on a leased line. Leased lines used to be very expensive in the UK but leased line costs have fallen considerably due to advances in fibre optic technology and commercial competition. In London, for example, the cost of a 2Mbit/s leased line has dropped by 90% in the past 15 years.

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