Taj Onigbanjo: now Africa has the opportunity to join the rest of the world
Didier Duriez: If we don't have cables there's no way to have broadband
A spate of cables has now landed or is due to land in the coming 18-24 months on both the east and west coasts of Africa. Terabits of new capacity are now available on the seaboards of the continent and the reduction in the cost of bandwidth that is enabling is opening up new possibilities.
“International connectivity costs for east and southern Africa have dropped sharply recently due to the anticipation and arrival of large amounts of bandwidth provided by fibre optic cables such as Seacom, which launched in July 2009,” says Suveer Ramdhani, head of product strategy at cable operator Seacom, who says that even countries which had fibre connectivity prior to his cable’s arrival, such as South Africa, have seen the monthly lease cost for an STM-1 circuit decline by over 50%, from 2.1m ZAR ($283,090) per month in 2006 to about 0.8m ZAR ($107,844) per month. “Countries that relied solely on satellite prior to Seacom’s arrival, such as Mozambique, Tanzania and Kenya, are experiencing unit pricing for international connectivity 90 to 95% cheaper than the equivalent unit price of satellite,” he says. “As more cables come online over the next few years, we expect prices to continue to decline in line with the amount of available bandwidth.”
“We’ve already seen the impacts of the decline in international long haul prices at the end consumer level,” adds Ramdhani. “The drop in international bandwidth prices has also stimulated investment in telecommunications infrastructure that would have never been possible prior to Seacom’s arrival.”
Seacom is far from the only submarine capacity provider (see panel) and both cable owners and more traditional operators are seeing a similar trend. Orange, which has capacity on the long-established SAT-3 cable, has also secured capacity on the EASSy cable which has just landed and the ACE cable which is under construction. In addition, it owns its own submarine cable between Mauritius, Reunion Island and Madagascar (LION). “The availability of bandwidth is changing very fast as cables become available,” says Didier Duriez, senior vice president of international network backbone factory at Orange. “If you take the example of Kenya, a year ago there were no cables, today there are two and pretty soon there will be three.”
For Jonathan Wright, commercial director at Interoute, which has acquired capacity on the Seacom cable linking to its European network at the Marseille, France landing point, the demand pattern resembles that of the Middle East five years ago.
“We’re certainly seeing very good growth in demand based around Seacom,” he says. “Corporate demand has been depressed by the cost of capacity and the experience is similar to ours in the Middle East five or six years ago. The arrival of these systems is incredibly important. Africa has historically been seen as a place where you pay a lot of money for poor quality services. Today the gap [in capacity availability] has narrowed with the cables coming in, but a few more cables and interconnect between them is necessary.”
Inevitably, the arrival of networks at the edge of the continent leads to concerns that the interior is still woefully underserved and comments that, in bandwidth terms, African has a hollow centre.
For Taj Onigbanjo, head of Middle East and Africa at Cable & Wireless Worldwide, focus must now shift inwards: “We’re seeing all this capacity coming into the shore but the challenge is how we bring that inland,” he says. “The reality is that is the next phase of network build and currently people in the mobile space are helping to grow internal capacity. The likes of Bharti and MTN are connecting intra country networks together so users can move from country to country without roaming. I’ve also seen plans to extend from Nigeria down through Ghana into Cote d’Ivoire potentially using oil transport pipelines. There’s a lot of talk and action because people realise the need for internal bandwidth. The cables have got to Nairobi and Abidjan but are not so good internally.”
Ramdhani at Seacom faces the prospect of having a fat, submarine cable with little to connect to but thinks enough is being done and his cable is justifying the case for inland bandwidth. “A number of businesses throughout east and southern Africa are currently rolling out national backhaul infrastructure including several national operators in South Africa,” he says. “Three national networks in Kenya and myriad entrepreneurs are already exploring business cases in Uganda, Zimbabwe, Tanzania, and Botswana. The government of Rwanda has laid huge fibre networks to connect urban and rural areas to the information superhighway. All of these investments are now economically feasible due to the substantially lower bandwidth prices brought by cables like Seacom.”
Duriez at Orange certainly sees the need for improved land capacity: “The countries that are landlocked are not as well served,” he says, pointing out Orange is working to improve the situation within its operational countries by constructing onward links into countries away from the cable landing points. “We have included Mali and Niger in the network and already have some territorial connectivity in Orange countries such as Senegal, Kenya and Cote d’Ivoire.”
However, the business rationale is not straightforward. “For operators that spent hundreds of millions of dollars, there has to be a return,” says Onigbanjo at Cable & Wireless Worldwide, which is part of the SAT-3 and WACS consortia. “There is no point if the bandwidth is extremely, extremely cheap.”
Nevertheless, the potential for cables to transform African economies is immense. “Africa has always been referred to as the dark continent,” adds Onigbanjo. “The arrival of the cable systems will really light it up. There’s a lot of action to come but a key thing to understand is that yes, there is a lot of capacity coming but it has to be very well managed. Now Africa has the opportunity to join the rest of the world. The opportunity for us at Cable & Wireless Worldwide is great.”
For Duriez, cable underpins the availability of useful, affordable bandwidth for the mass market: “Clearly the cables provide an opening to broadband,” he says. “If we don’t have cables, there’s no way to have broadband because satellite is too costly. That means without cables most of the internet and most of the applications are out of reach. We see business applications like Orange Money and applications in healthcare and education opening up once bandwidth arrives.”
Seacom’s Ramdhani agrees: “Cables are an essential part of the broader African internet build-up and as other cable systems come on line, there will be more redundancy between the systems ensuring a continuous and reliable information superhighway to support the development of the continent,” he says.
The benefits, as Onigbanjo suggests, could extend far further than simply providing connectivity. Duriez concurs and, in terms of stimulating African economies, sees offshoring and call centre activities potentially entering his operating countries. “In the mid to long-term, I wouldn’t be surprised to see call centres arrive. You see a lot of that in French speaking North Africa so it would make some sense. However, for that to happen, arrival of bandwidth is only part of the equation. For instance, political stability is needed as well to attract investors.” GTB
Cable systems serving Africa
SAT-3/WASC/SAFE
Connects:Portugal, Spain, Senegal, Côte d’Ivoire, Ghana, Benin, Nigeria, Cameroon, Gabon, Angola, South Africa, La Reunion, Mauritius, India and Malaysia
Cable length: 28,800km
Capacity: 120Gbps (Europe to South Africa), 130Gbps (South Africa to Malaysia)
Launch: April 2002
SEACOM
Connects: South and East Africa to Europe and South Asia includes backhaul to Nairobi and Johannesburg. Within Africa, South Africa, Mozambique, Tanzania and Kenya are connected and there are connections from Kenya to Marseilles and Tanzania to Mumbai. Since July 2009 SEACOM has procured capacity to provide an onward connection from Marseilles to London.
Cable length: 15,000km
Capacity: South Africa to Kenya 1280Gbps, Kenya to Marseilles 640Gbps, Tanzania to Mumbai 640Gbps
Launch: Commissioned on July 23 2009
TEAMS
Connects: Kenya and the UAE
Cable length: 4500km
Capacity: 120Gbps upgradable to 1.2Tbps
Launch: Landed on 12 June 2009
EASSy
Connects: South Africa, Mozambique, Madagascar, Comoros, Tanzania, Kenya, Somalia, Djibouti and Sudan
Cable length: 10,500km
Launch: 30 July 2010
Main One, phase one
Connects: Portugal, Ghana, Nigeria
Cable length: 7,000km
Capacity: 1920Gbps
Launch: In service
Main One, phase two
Will connect: Morocco, The Canary Islands, Senegal, Cote d’Ivoire, Nigeria, Gabon, Democratic Republic of Congo, Angola and South Africa
Cable length: 7,000km
Launch: under construction
GLO1
Connects: Nigeria, Ghana, Senegal, Mauritania, Morocco, Portugal, Spain and UK
Cable length: 9500km
Capacity: 640Gbps
Launch: under construction/ ready for commissioning
WACS
Connects: UK, Portugal, The Canary Islands, Cape Verde, Cote d’Ivoire, Ghana, Togo, Nigeria, Cameroon, Republic of Congo, Deomcratic Republic of Congo, Angola, Namibia and South Africa
Capacity: design capacity of 3.84Tbps
Launch: Due 2011
ACE
Will connect: South Africa, Namibia, Angola, Democratic Reopublic of Congo, Equitorial Guinea, Sao Tome and Principe, Cameroon, Nigeria, Benin, Ghana, Cote d’Ivoire, Liberia, Sierra Leone, Guinea, The Gambia, Senegal, Mauritania, Spain, Portugal and France.
Capacity: 5.12Tbps supporting 40Gbps technology
Cable length: 17,000km
Launch: Due 2012