From Ezine articles :
Tier-1 is a network in which only settlement free peers and customers are serviced. The network operator pays for none of it's transit.
Tier-2 is where the network operator buys all or some of it's transit from a Tier-1 and resells it.
Tier-3 are downstream customers of Tier-2's. Tier-3 may give you what looks like a good price.....but longterm reliability, performance, and scalability will likely suffer. For piece of mind for your business a Tier-1 or Tier-2 are better choices is almost every case. However, PowerNet Global is a big exception to this rule due to their solid infrastructure and relationships with major players.
I hope it would help.