What is IP Transit? A Clear Guide for Network Buyers

IP transit is a paid service that gives your network access to the global internet. You buy it from an upstream internet provider (also called a Tier 1 or Tier 2 ISP). They route your traffic to the rest of the internet using BGP (Border Gateway Protocol).

If you're building or expanding a network—data center, ISP, enterprise, CDN, or hosting platform—you need to understand how IP transit works, what it costs, and how to compare providers.

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How IP Transit Works

Here’s a simplified breakdown:

• You connect your router to the transit provider’s router using a physical or virtual link.
• You advertise your IP prefixes via BGP.
• The provider announces your routes to the rest of the internet.
• The provider sends you a full routing table so your network can send packets to any destination.

You're paying for access to "the full internet routing table," not just a single network or a few peers.

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IP Transit vs Peering

This trips people up. IP transit is not the same as IP peering.

IP Transit	IP Peering
Paid	Usually free or settlement-free
One provider gives access to all networks	Direct connection between two networks
Can be single-homed or multi-homed	Requires peering policy agreement

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Key Features of IP Transit Services

When you're comparing IP transit providers, look at these:

• Route quality – How stable and low-latency are the paths?
• Port speed – 1 Gbps, 10 Gbps, 100 Gbps are standard offers.
• Pricing model – Usually per Mbps on 95th percentile billing.
• SLA – Guarantees on uptime, packet loss, jitter.
• Network reach – Tier 1 providers have better global reach.
• Support and response time – Critical if you're a 24/7 operation.

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IP Transit Pricing

Pricing varies by:

• Location (transit in Asia or Africa costs more than in Western Europe)
• Volume (high traffic gets lower per-Mbps rates)
• Commitment term (longer-term contracts get better rates)

Typical pricing in major markets (as of 2025):

Location	Approx. Price per Mbps (95/5)
Frankfurt	€0.10 – €0.50
London	€0.15 – €0.60
New York	$0.10 – $0.45
Singapore	$1.00 – $3.00
Johannesburg	$3.00 – $7.00

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Why Multi-Homing Matters

Using more than one transit provider (multi-homing) gives:

• Redundancy – if one provider fails, traffic still flows
• Better latency – you choose better paths via BGP
• Leverage – easier to negotiate pricing and performance

If you’re serious about uptime, multi-homing with diverse IP transit carriers is non-negotiable.

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Choosing the Right IP Transit Provider

Don’t pick based on price alone. Ask:

• Are they a Tier 1 network or Tier 2 with good upstreams?
• Do they offer clean IP space with no blacklisting?
• Can they deliver capacity at your POPs or data centers?
• Do they provide real-time BGP communities for routing control?

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Related Terms You Should Know

• AS (Autonomous System) – A unique number assigned to your network.
• BGP communities – Tags to influence routing decisions.
• 95th percentile billing – How most IP transit billing works.
• Blackholing / DDoS protection – Often bundled with transit.

Final Thought

IP transit is the backbone of how large networks connect to the global internet. If you're building infrastructure that needs reliable, fast, and scalable internet access, you’ll need the right IP transit provider with the right routes, price, and support.

Shift Hosting offers IP transit starting at just $200 per Gbps.
Learn more: Here

Want a custom quote? Email us at Sales@Shifthosting.com