There are advertisements everywhere for T1 internet service these days, in newspaper ads, radio spots, and Web banner ads. The popularity of T1 is no surprise given the dramatically reduced cost. T1 internet service originally cost $5,000 a month but can now be had for as little as $150, especially in urban markets where business densities are high.

T1's price plunge can be better understood on a macro level. The commoditization of bandwidth has led service providers to lay fiber as fast they can. There are several other factors in the equation that have boosted the wild popularity for T1 lines. Competitive carriers aren't just wiring business districts and office parks. They're also running high-capacity fiber directly into buildings and up the elevator shafts of the biggest high-rises they can find.

Digital subscriber line (DSL) services are almost as fast as a T1. This service is becoming more widely available and driving the cost of T1 down further. Satellite service providers are beckoning potential customers to cut the cord entirely and tap that big network in the sky. This competition is driving prices to record lows.

Market cynics point out that the regional Bell and other local telephone companies such as Verizon, Inc. have been relatively passive with regard to T1 access pricing. By keeping their prices high, competition for all local telecommunications services can flourish. That, in turn, builds the political case for the Bells to get the necessary, if elusive, federal approval to enter the multibillion-dollar long-distance market.

A T1 line's total bandwidth is a little more than 1.5 Mbps and is usually divided into 24 separate channels of 64 Kbps each, an arrangement that permits many customers to multiplex voice and data traffic across the link. There are two flavors of local T1. The basic type connects a customer site with a carrier point of presence for transport across the public switched telephone network. An Internet T1 involves an ISP and a local access carrier (which are sometimes the same company) to connect to the Internet. Customers pay slightly more for Internet T1s because the local carrier charges for the line and the ISP charges for connecting the customer line to a port on its router.

Pricing for a basic T1 line averages $300 to $500 a month, while an Internet T1 costs from $900 to $2,500. Regardless of line type, pricing will vary depending on distance from the point of presence, whether you rent or own the access and termination equipment, and the duration of the agreement.

"A full T1 a few years ago was $4,800; we now pay between $1,600 to $2,400 for an Internet T1, depending on the line," said Brad Johnson director of communications and network systems at Value City Department Stores Inc. in Columbus, Ohio, which uses T1s as the backbone for a virtual private network to 138 locations. The network is supplied by AT&T and 30 or 40 local carriers.

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