Africa to spend $6 billion on fibre ICT projects

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20 August 2008 News

In the last decade or so, investment in Africa's ICT infrastructure has improved significantly. However, marked deficiencies persist in the backbone networks across the continent. Maxwell Chanakira, BMI-TechKnowledge research analyst states, "Although countries on the African west and southern coasts have access to fibre connectivity through the SAT-3 undersea cable, an estimated 80% of Africa's international voice and data traffic is carried via satellite."

Following the glut of international submarine fibre-optic bandwidth that emerged around the turn of the century, the industry has shown signs of increased activity in the past few years. Since December 2006, several cable projects have been planned. From the US, two cables are being constructed to China, one to Australia and a further two to the Caribbean. Multiple cables are in various stages of development between East Africa and India.

A report from BMI-TechKnowledge reveals that in Africa, the effective high-speed Internet services required for critical business, government and consumer applications have remained either unavailable or very expensive. Governments' awareness of this situation, and the perceived commercial attractiveness of the opportunity to close this gap, has given rise to the current frenetic activity for construction of submarine fibre cables on the continent.

"There are at least 10 submarine fibre cables and a significant number of supporting terrestrial cables that are either planned or under construction in Africa, with South Africa, Nigeria, Kenya and to a lesser extent, Tanzania driving the demand for international connectivity. Companies will spend in excess of the equivalent of $6 billion on submarine and terrestrial infrastructure projects in Africa over the next 24 months," states Chanakira.

The total design capacity of all planned cables is 10 Tbps - up from the baseline of less than 400 Gbps currently. "When these cables have been completed there will be a vast amount of excess capacity," adds Chanakira.

BMI-TechKnowledge expects demand from Africa will increase to just 300 Gbps by 2015, and a maximum of 2 Tbps by 2019. "This would represent a significant capacity glut in excess of 9 Tbps in five years time, and would remain a glut of 8 Tbps 10 years from now," states Chanakira. "This excess capacity means that the business cases for some of the cables are not watertight and consequently, it is expected that some consolidation will take place among the cable projects and some could even fall by the wayside."

For more information visit www.bmi-t.co.za

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Africa to spend $6 billion on fibre ICT projects

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