The Difference Between Speed and Bandwidth for a Business Network 

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The terms ‘speed’ and ‘bandwidth’ are often used interchangeably when describing how fast a business network is. However, while speed and bandwidth often represent the same number, especially in smaller networks, when approaching larger more complicated networks, the speed and bandwidth can become different figures entirely. This is because these two terms actually refer to seperate aspects of network data transfer.

This article will discuss the difference between speed and bandwidth, and provide definitions for each. Business managers and junior IT staff will benefit from this article. Packetworks prides ourselves in our knowledge of all things network related. Read on to learn more, or click here to contact Packetworks today.


When speaking of network speed, what is being talked about is the maximum bit-rate that the network hardware can accomodate.

This definition differers from the network bandwidth. Network bandwidth should be thought of as the ‘speed’ that is available for a network request to use.

Example: a 500 Megabit (Mb) MPLS services that utilizes a 1 Gigabit (Gb) Ethernet connection has a bandwidth of 500 Mbps and a speed of 1 Gbps (1000 Mbps).

Bandwidth vs Speed: Link Aggregation

There are several common examples of bandwidth and speed being separate figures from each other. One such example occurs with link aggregation:

Link Aggregation Definition: using 2 or more Ethernet ports in parallel to provide trunking and fault tolerance in a network. Link aggregation improves the bandwidth of a network connection.

In the image to the right, two Ethernet connections are bonded into a single interface. This interface is utilizing 2 x 10 Gigabit Ethernet which gives a maximum bandwidth of 20 Gb, but a max speed of only 10 Gb. Click here learn more about link aggregation.

Bandwidth vs Speed: Wide Area Network (WAN)

Another common occurrence of speed and bandwidth discrepancies occurs in a WAN network when provisioning WAN circuits. It is common practice to use a high speed circuit (ex: 10 Gbps) to connect between different nodes, but then limit the bandwidth during actual use to lower numbers (ex: 100 Mbps / 0.1 Gbps). This will result in a network speed of 10 Gbps, but a bandwidth of 100 Mbps.

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