Internet Service Provider (ISP) hierarchy

Internet Service Provider (ISP) is a company which provides internet connection to end user, but there are basically three levels of ISP. There are 3 levels of Internet Service Provider (ISP): Tier-1 ISP, Tier-2 ISP, and Tier-3 ISP. 

These are explained as following below. 

• Tier-1 ISP: 
  These ISPs are at the top of the hierarchy and they have a global reach they do not pay for any internet traffic through their network instead lower-tier ISPs have to pay a cost for passing their traffic from one geolocation to another which is not under the reach of that ISPs. Generally, ISPs at the same level connect to each other and allow free traffic passes to each other. Such ISPs are called peers. Due to this cost is saved. They build infrastructure, such as the Atlantic Internet sea cables, to provide traffic to all other Internet service providers, not to end users. 
  
  Examples: 
  Some examples of tier 1 Internet providers: 

Cogent Communications,
Hibernia Networks,
AT&T

• Tier-2 ISP: 
  These ISPs are service provider who connect between tier 1 and tier 3 ISPs. They have regional or country reach and they behave just like Tier-1 ISP for Tier-3 ISPs. 
  
  Examples: 
  Examples of tier 2 ISPs: 

Vodafone,
Easynet,
BT

• Tier-3 ISP: 
  These ISPs are closest to the end users and helps them to connect to the internet by charging some money. These ISPs work on purchasing model. These ISPs have to pay some cost to Tier-2 ISPs based on traffic generated. 
  
  Examples: 
  Examples of Tier-3 ISPs: 

Comcast,
Deutsche Telekom,
Verizon Communications