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BLOG: Betting on Asia and Africa

John Hayduk | Aug. 2, 2012
Undersea cables: Where will we see builds happening and where is future capacity required?

When anyone talks about the undersea cable market they are inevitably talking about what the future holds. It is not about the cables that are in the water today and where they are connected but about where to build next or how much capacity is required in the future. It is the nature of the business. So where will we see builds happening and where is future capacity required?

Over the next five years, I think we will see a number of key areas around the world that will grab our interest and attention. Given its population size, my bet is on Africa seeing a lot more development and innovation. There are already cable systems being built on both sides of the continent. This connectivity will allow deeper reach into the continent with new systems adding not just one cable landing for a market but two or three.

The desire to improve connectivity and communications infrastructure is a trend we've seen echoed in our recent 'Connected World' Emerging markets research and whitepaper which found that 47 percent of companies in emerging markets identified Africa as a key focus and area for development, but also concern with regards to ready infrastructure. However, an expansion of connectivity into Africa will certainly increase competition and allow Internet penetration levels to grow.

This of course opens up a world of opportunity and that's an exciting prospect as it means a really sizeable population will get better connectivity and have greater access to global infrastructure.

Renewed interest

Over the next five years there will also be renewed interest in handling capacity demand in Asia and India as Internet penetration gets deeper across those regions of the world. There will be continued cable activity there but also a focus on upgrading consortium cables that will begin to show their age as demand increases. Some replacement work is going to have to happen.

Systems that are not prepared for a 40G or 100G upgrade will need to be replaced. These are systems that were built 10 plus years ago. The characteristics of these systems won't be able to upgrade to 40G or 100G capacity and that is a more challenging problem to solve. With demand in Asia rising, I see upgrades and new builds being absolutely critical to future progress.

When we talk about the future of the undersea cable market this refocusing on Asia and Africa is going to both stimulate and serve demand. It means in five years greater density of undersea cable connectivity and better connected global markets. But much more than that, it means more access and better opportunity for all, and that is exactly where we want to be heading!

John Hayduk is president, product management and service development, Tata Communications.

 

 

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