The weight of governments in the African terrestrial fibre business is increasing. African government have committed around $1.7bn to building fibre backbone networks since 2010, the 'The Future of African Backbone & Metro Fibre Networks' market study has found. In many markets, the government is the largest holder of terrestrial fibre capacity, a trend that carries significant implications as Africa seeks to enter the 4G and 5G eras. Is this a sustainable solution to reducing Africa's growing urban/rural broadband divide? It's complicated.
Governments have reasonable justification for getting deeper into fibre. For a multiplicity of reasons (tough geographic economics, regulation, high roll-out costs, etc.), the business case for building backbone fibre infrastructure across African countries has traditionally not been appealing to private providers. Those that built did so primarily to support their own retail operations and concentrated on capital cities.
The consequences have been numerous – an accentuation of the urban/rural divide, extensive, but closed-off fibre networks, high levels of fibre infrastructure duplication. In many markets, the lack of infrastructure and the high price points offered by private operators made it difficult for governments to extend connectivity to public service institutions – public administrations, schools, hospitals, etc. In response, most governments are taking it upon themselves to build.
For the past two decades, the availability of affordable terrestrial fibre capacity has been one of the biggest obstacles to the development of the African Internet, a problem so complex few markets have managed to solve it, and many despairingly looked like they never might. Until now.
This report, the outcome of years of accumulated research, data, and insights, provides an unprecedented view into African terrestrial fibre market dynamics. It is about how, and where to generate investor value in this mishmash of opportunity and risk. And perhaps, most of all, it is about whether Africa will, at last, solve what we have called the “mother of all Internet bottlenecks”.
120 pages ~ 56 charts ~ 600,000 kilometres of fibre