Demarcation Point: What Is It & How Is It Used?

Point of demarcation

Have you ever wondered where the line between your phone service provider’s network and your own private network lies? That’s where the demarcation point comes in.

Today, we’ll explore the demarcation point’s significance, its role in network infrastructure, and the importance of proper management and maintenance for ensuring seamless communication and connectivity.

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What is Demarcation Point?

A point of demarcation is the point in the physical wiring where the public telephone network ends and the private residential or organizational telephone network begins. This point is also known as the demarcation, dmarc, network boundary point, and demarcation point.

It clearly identifies who is responsible for which portion of the private and public network in terms of upkeep and maintenance. In a network installation, each individual private network within the building must be physically wired into the point of demarcation.

Functionally, a network demarcation point makes it easy to determine who is responsible for cabling and equipment repairs and maintenance.

This is why it’s important to be aware of the point and to know where it is: if it falls on the customer’s side and thus onto the customer’s responsibility, they can address the issue as soon as possible.

IT professionals have also taken advantage of this physical point to add a spark gap surge protector to the network termination unit, which protects the private network from surges on the public network.

Demarcation points are useful in troubleshooting because they allow for easy disconnections of networks from the larger network for testing and repairs.

Specialized network security features and redundancies can also be installed at the demarcation point, depending on the needs of the business or individual customer.

fiber optic

Demarcation Point in Telecom History

Demarcation points have a somewhat dramatic origin, unlike other aspects of network installations. They exist due to a 20th-century antitrust lawsuit against AT&T. 

The American Telephone and Telegraph Company was founded in 1886, and it and its subsidiaries rapidly expanded to become the majority telephone service supplier and, through its subsidiary Western Electric, most telephone equipment in the United States.

Because the telephone company essentially owned their customer’s wiring, customers had no choice but to use AT&T for their phone service. It was, in fact, a monopoly in the telecommunications industry. This state of affairs became known as the Bell System Companies, with AT&T often derisively called “Ma Bell.”

In 1956, other smaller telecommunication companies began to file lawsuits against AT&T, and eventually, in 1974, the Department of Justice itself filed an antitrust lawsuit against the telecommunications company. This suit ended in a settlement in 1982, which declared that by January of 1984, AT&T telecom company must divest itself of the ownership of its regional subsidiaries, which would then function as independent telephone companies. 

This opened the playing field to competition from other phone companies and allowed third-party phone equipment manufacturers. Americans could now choose to have a different telephone provider than AT&T and different equipment than Western Electric’s.

This is where the necessity for a demarcation point arose–an indicated point where the phone company’s property ended, and the private citizen’s or private business’s property began.

Point of Demarcation for Business

Not every point of demarcation is alike. The three most common demarcs for business phones are Network Terminal Interfaces, Smartjacks/Intelligent Network Interface Devices, and Optical Network Terminals. 

Regardless of which type it is, demarcs will be located at the Main Distribution Frame, or MDF, of the central office building in question.

ReadMDF vs IDF

Network Terminal Interfaces

These NIDs are commonplace and have the most basic features. They are mostly used in residential networks.

They come in a small, weatherproof box that contains surge protectors, circuit protection, a small local loop to telephone cord connecting to a test jack, and the telephone company’s wiring terminals. The FCC regulates its ratings, and which rating you need depends on the scale of your building and its network.

Network Terminal Interface

Intelligent Network Interface Devices/Smartjacks

INIDs are a more advanced version of NIDs appropriate for more complex network setups, such as triple-play providers and T1 lines with their own separate box. These demarcation points are usual in business network settings.

NIDs have fairly basic wiring, but INIDs use circuit boards and signal boosters. It has lightning arrestors to remotely test if a carrier wiring fault lies on the customer premises without being physically present.

They also usually include an alarm system that customers and local access providers can access.

Optical Network Terminals

These demarcation points provide the highest speeds thanks to the inclusion of fiber optic cables–essentially, they take the signal from the local ISP and immediately speed it up to benefit the rest of the private LAN.

However, they require outside power and backup batteries in a system power outage.

Also, I want to learn more about the different types of network installation.

Uses of a Demarcation Point 

  • Acts as a termination point for incoming communication lines from the provider, such as telephone lines, fiber optic internet lines, internet connections, voice over internet protocol, phone system, or cable services.
  • It separates the publicly owned infrastructure from customer premises equipment, aiding in legal and liability matters on a single telephone line. 
  • Allows easy access to network connections for service upgrades, repairs, or reconfigurations without disrupting the entire phone system. 
  • Enables efficient network performance and traffic flow monitoring, aiding in network optimization and capacity planning.
  • Supports the implementation of security measures, such as firewalls or intrusion detection systems, to protect the customer’s network from external threats.

Demarc Extensions

In many commercial settings, the physical location of the private customer network can be quite a ways from the service provider network.

In a vertical office building or skyscraper, for instance, businesses on higher floors are far removed from the demarcation point on the ground floor.

Or, in a business with a large campus, the network boundary point for the internet service providers may be at a distance from where the buildings begin.

Cases like these require a demarc extension, which is pretty much what it sounds like–cable installation to bring the demarc point closer to the customer network.


Who is responsible for maintaining the demarcation point?

Typically, the service provider is responsible for maintaining the demarcation point until it connects to the customer’s network. 

Beyond the modern demarcation point, the customer is responsible for maintenance or issues related to their new communication channel. 

What role does the demarcation point play in troubleshooting network issues?

The demarcation point is a boundary between the service provider’s and customer’s networks. When troubleshooting network issues, technicians often start at the demarcation point to determine whether the problem lies with the service provider’s or customer’s internal network.

Can customers make changes or modifications to the demarcation point?

In most cases, customers are only allowed to make changes or modifications to the demarcation point with prior authorization from the service provider. Any alterations to the demarcation point could affect the integrity of the network connection and may violate service agreements.

How much does a demarcation point extension cost?  

Typically, prices start around $300 for small businesses. The extension cost can vary based on your business’s location relative to the original point.

Additionally, extensions are often completed by the phone company within a single day, ensuring minimal disruption to operations.

How do you find the demarcation point?

To find the demarcation point, search for a junction box or termination point on the exterior of the building where the service provider’s network cables enter. Locate the intelligent network interface device (NID) or demarcation extension box near the entry point of external cables.

If needed, consult the documentation for guidance or contact them directly. Look for labels or markings on cables or equipment, and conduct a thorough physical inspection of the building’s exterior and interior to locate any installed third-party equipment.

Key Takeaways

The point of demarcation is not the most complex component in a network. Still, it plays an important role in allowing customers, businesses, and organizations to choose the telecom provider and equipment that best meets their needs.

Ready to elevate your network infrastructure with top-tier fiber optic solutions? The Network Installers are here to guide you every step of the way.

Contact us now to get started on your seamless installation journey.

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The Network Installers is a low voltage electrical contractor that provides data cabling, network installation, fiberoptic installation, and WIFI installation. We've been serving commercial customers since 2008 with exceptional quality, consistency, and professionalism.


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