We introduce a facility location problem with submodular facility cost functions, and give an O(log n) approximation algorithm for it. Then we focus on a special case of submodular costs, called hierarchical facility costs, and give a (4.237 + )-approximation algorithm using local search. The hierarchical facility costs model multilevel service installation. Shmoys, Swamy and Levi [18] gave a constant factor approximation algorithm for a two-level version of the problem. Here we consider a multilevel problem, and give a constant factor approximation algorithm, independent of the number of levels, for the case of identical costs on all facilities.