An SLA, or Service Level Agreement, is a set of additional terms and conditions between you and your service provider that sets minimum expectations of the quality and availability of service they provide to you. SLA’s are employed heavily with major internet service connections, such as those feeding large companies and data centers, but they come at a cost. Internet connections with SLA’s almost always come at a premium compared to more commodity business internet options. As a small business, should you pay extra for internet that comes with an SLA?
Note: the advice offered in this article is meant for a typical office-based small business. There are exceptions to all of this guidance for businesses that are larger or more complex. The best way to determine the right choice for your business is to consult an IT professional (not an internet carrier trying to sell you service) who knows you, your environment, and your requirements!
What does an SLA do?
An SLA sets a mutual expectation of what an acceptable level of service is. For example, your SLA may say that your internet connection will be available 99.90% of the time. This translates into an acceptable maximum downtime of 7.20 hours of downtime per month, or 3.65 days per year. If your connection ever exceeds this allowed amount of downtime in the period specified in the SLA (usually over a 30 day period), then the repercussions of the SLA can be enforced.
Do I need these performance assurances?
Most internet services, including Voice-over-IP (VoIP) phones, must be built by design to be tolerant of variations in internet speed and packet delivery. The internet carrier’s SLA can only offer assurances on what happens between your office and the edge of their internal network where your traffic flows to the internet. Once your traffic reaches the internet, that traffic is out of the hands of your internet carrier and their SLA. In general, if something is going to go wrong and interfere with how quickly and reliably your traffic is going to be delivered, it will be likely caused by factors in the public internet infrastructure that are beyond the control of your carrier anyways.
This does not mean that it is not important in many circumstances to have your carrier committing to high standards of packet delivery. Environments with large VoIP installations, P2P peering connections, and hosting public-facing servers demand optimal performance at every link in the chain. However, this is by nature beyond the scope of a typical office-based small business.
Are the SLA commitments a “guarantee”?
With an SLA you have a more clearly defined standard of what constitutes a problem, a procedure for reporting trouble, an expectation of how quickly the trouble will be resolved, and consequences for the carrier if they fail to meet the SLA. Just because performance is promised in an SLA does not mean that it is not possible for performance to fall below those thresholds. It is entirely possible for the connection to fail to meet performance metrics just as often or even more often than a connection that does not have an SLA.
All internet connections can have problems, SLA or otherwise. Regardless of how hard any carrier tries, they cannot do anything to stop a car from running over a telecom post, a major power outage, a construction worker from cutting your line, or a natural disaster from crippling an entire city. All carriers face an incredible challenge and strive to maintain 100% uptime, but even the most well designed, tested, and maintained infrastructures can fail and do fail in some way eventually.
It is important to not treat an internet connection as a sure thing just because it has an SLA. Always assume that any internet connection can degrade or fail, SLA or not.
What happens if my carrier fails to meet the SLA?
First, and most importantly, SLA’s state a particular procedure that you must follow to report any trouble. If you do not follow this procedure and report the carrier’s failure, then you cannot hold them to the SLA. The responsibility is on you to enforce it.
When you do report the trouble, the carrier will then have a period of time to respond and resolve the issue. Depending on the SLA, you may have the ability to get partial refunds of your service fees or to break your contract early.
Often times, especially for SLA’s offered to small businesses, the consequences for the carrier failing to meet the SLA are relatively minor. For example, if you have no internet service for 2 consecutive days in a month (possibly a crippling outage), the carrier may only reimburse you for the prorated fees from your monthly bill for those 2 days, or 6.7% of your monthly service amount. In this example, if your bill is $500/month and you had no service for two whole days, your way of punishing the carrier is to make them credit you $33.33.
Should I get an SLA?
SLA’s are great if you can get them, and are certainly a sign of an internet carrier more seriously committing to providing a consistently reliable and well-performing connection. However, connections with SLA’s can cost 50-200% more than their non-SLA alternatives for speeds as much as 75% slower. If avoiding any extended internet connection outage is a critical consideration for your business, the question becomes how much more are you willing to pay for that, and how much speed are you willing to sacrifice?
After you run the numbers, you may find that the better investment is in a second failover non-SLA internet connection. Most often, you can get two non-SLA business connections that are both faster for less than a single SLA internet connection! With a properly configured router that is set to automatically failover to your backup connection if your primary connection degrades or fails, odds are you will get the same or better uptime for less cost per month than the single SLA connection.
In other words, most small businesses should first prioritize speed and cost. Outages and service issues will happen. If it is not your internet connection going down, it could be your power, your phones, or even a blizzard preventing your workers from reaching the office. You should have a plan in place to respond to any business interruption regardless of what kind of internet connection you have. If reliability is critical to you, evaluate the costs of a second connection from a different provider. For example, pair a backup $60/month DSL line alongside your $150/month primary cable connection. If your primary connection goes down, your router can automatically switch you to the backup DSL connection in less than 60 seconds. This may cause a hiccup in web browsing or a couple dropped phone calls, but the possibility of this rare inconvenience should be acceptable for a typical office-based small business. The odds of both connections being out at the same time are extremely small, and if it they are both unavailable there is likely a larger widespread problem that may even take down an SLA connection.
Still not sure what the best option is?
Contact NorthSky Technology today and get your FREE tech check! As a complimentary service to you, whether you are a client or not, we will review your environment, including your internet connection options, and provide a free report of our findings and recommendations! We also can help develop and maintain incident-neutral response plans and procedures for disasters, breaches, outages, and failures as part of our security consulting services. Contact us to learn more!