Sub-sea cables provide incentive for laying fibre in Africa - an lower bandwidth costs

As a series of submarine cables on both the east and west coasts of Africa land, the focus has turned to land-based fibre-optic cables. The landing of the Seacom, Eassy and TEAMs cables, among others, is set to invigourate the fixed-line telecoms market in the sub-Saharan region. Analyst firm Frost & Sullivan has reported that fixed line providers in the region generated revenues of US$6.78 billion in 2008 and estimates this will rise to US$12.25 billion by 2015. That increase will be driven by the availability of fixed line cables along the continent's seaboard, says the firm which claims such links will give the fixed-line sector 'a second life.'

The key growth drivers for wireline telecommunications are the increasing demand for data and internet services, cost effective deployment of fixed-wireless technologies and the introduction of fibre-optic cables," says Jiaqi Sun, a research analyst with Frost & Sullivan.

However, fat submarine pipes alone won't transform communications in the region. Concerted efforts to improve capacity on the ground still need to be made. One country leading that charge is Tanzania which has recently activated its National Information Communication and Technology Broadband Backbone (NICTBB). NICTBB is a terrestrial continuation of a fibre-optic submarine link recently landed in Dar es Salaam, which it is claimed has already resulted in a drop in internet capacity charges. The NICTBB is now active in 16 regions in the country and the project, which is expected to cost approximately US$167 million, is set to be completed this year.

The arrival of the cables isn't good news for everyone. A report from Africa Investor says there are indications that revenues of satellite operators in Nigeria may dip as a consequence of the new capacity becoming available. The report states that as cables go live in June, the price of bandwidth in Nigeria and Ghana could drop by as much as 50%.