Investments drive growth in subsea cable sector

With over 450 undersea cables transporting over 95% of all international telecom service traffic as well as the steadily rising data traffic produced by hyperscale cloud providers and major streaming content providers, the international subsea cable industry is flourishing.

To ensure the sector can continue to meet the insatiable demand for higher capacity, size, and reach, more and more innovative undersea systems are either being installed or planned. More than 1.5 million miles of undersea fiber optic cables already circle the globe.

In a recent industry analysis titled “A 2022 update on Interconnection Geography,” published by the telecoms market research and consultancy firm TeleGeography, it was revealed that since 2017, connectivity between Africa and Europe has been operating at roughly 80% of its maximum capacity. However, it pointed out a discrepancy in the international linkages between North and South Africa.

According to TeleGeography, whereas sub-Saharan Africa’s connectivity to Europe has decreased to roughly 60% of its full potential, North Africa still enjoys very close to 100% international connectivity.

Also, investments in the different submarine cables that have reached Nigeria have already surpassed $3 billion from the $1 billion investment made roughly four years ago.

The price of the SAT3 fiber optic cable, which is presently owned by Ntel, is estimated to be $600 million. WACS from MTN costs $650 million, while MainOne spent $300 million and ACE cable from Dolphin Telecoms is worth $700 million. Glo 1 cable from Globacom is predicted to cost $250 million, and Glo 2 is anticipated to cost in the same ballpark.

Although the Equiano cable’s estimated investment is private, Google has stated that the facility is a component of the $1 billion investment scheme planned to aid Africa’s digital revolution. By 2023, a $1 billion, 37,000-kilometer undersea cable from Meta (Facebook) should have reached Africa via Nigeria.

In parallel, the 46 locations that the 2Africa consortium, which consists of China Mobile International, Meta, MTN GlobalConnect, Orange, STC, Telecom Egypt, Vodafone, and the West Indian Ocean Cable Company (WIOCC), has planned, are being built out.

The 2Africa undersea cable system and its “Pearls” expansion, first announced in May 2020, will connect Africa, Europe, and Asia by 2024 and offer high-speed international access to almost three billion people, or about 36% of the world’s population.