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Fibre Optic Cables to Drive the Fixed-line Telecoms in sub-Saharan Africa Says Frost & Sullivan - Sub-Saharan Africa has the lowest fixed-line penetration rate in the world. Incumbent operators mainly attribute this to low investments in copper-wire network infrastructure in the past
Fibre Optic Cables to Drive the Fixed-line Telecoms in sub-Saharan Africa Says Frost & Sullivan

 

PRZOOM - /newswire/ - Cape Town, South Africa, 2010/05/24 - Sub-Saharan Africa has the lowest fixed-line penetration rate in the world. Incumbent operators mainly attribute this to low investments in copper-wire network infrastructure in the past.

   
 
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However, a series of fibre-optic cables that are being placed along the east and west coasts of the continent are expected to give a second life to fixed-line telecommunications and cater to the rising demand for data and broadband Internet services.

New analysis from Frost & Sullivan (ipcommunications.frost.com), Survival Strategies for Fixed-line Telecommunications Operators in Sub-Saharan Africa, finds that the market earned revenues of $6.78 billion in 2008 and estimates this to reach $12.25 billion in 2015. The fixed-line technologies covered in this research include copper-wire network, fibre-optic network, dial-up, asymmetric digital subscriber line (ADSL), integrated serial digital network (ISDN), worldwide interoperability for microwave access (WiMAX), code division multiple access (CDMA) and multi-protocol label switching (MPLS).

If you are interested in more information on this study, please send an email to Patrick Cairns, Corporate Communications, at patrick.cairns[.]frost.com, with your full name, company name, title, telephone number, company email address, company website, city, state and country.

"The key growth drivers for wire-line 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 Frost & Sullivan Research Analyst Jiaqi Sun. "Corporate customers are the major revenue contributor for fixed-line services, particularly data and Internet services and fixed-wireless technologies."

Fixed-wireless technologies such as WiMAX and CDMA have overcome the requirements of capital-intensive copper-wire infrastructure investments to achieve less time-to-market of new services. Additionally, fibre-optic cables will reduce costs and increase the bandwidth capacity of Internet services in the next three to five years.

"Corporate customers continue to prefer superior fixed-line to mobile services," Sun notes. "Traditional fixed-line operators are in the process of deregulating and migrating to fixed and/or fixed-wireless technologies."

He expects that the combination of fixed-line strength with innovative mobile offerings will help to retain existing customers as well as attract new ones. In addition, data and Internet services will be the future revenue generators for fixed-line telecommunications.

However, the dearth of reliable power supply is hampering network performance. Furthermore, high incremental costs of fixed-line infrastructure are inhibiting network rollout and market monopoly is restraining competition.

"The lack of physical infrastructure such as power generation plants in sub-Saharan Africa limits the expansion of wire-line networks," explains Sun. "Conventional fixed-line telecommunications also relies on expensive copper wire-lines. Fixed-line operators find it difficult to improve the quality of services as there is a lack of private investments to fund the infrastructure rollouts."

In addition, the majority stakes of incumbent operators are still controlled by national governments in sub-Saharan African countries. Therefore, the slow progress in deregulation of national incumbents restricts the growth of fixed-line telecommunications, because governments have a limited funding for the development of the capital-intensive fixed-line network infrastructure.

Frost & Sullivan believes that traditional incumbent operators should gradually migrate to fixed-wireless and/or mobile technologies to diversify their service portfolios.

"Combining the quality of fixed-line services with the mobility of wireless ones will give fixed-line operators a competitive edge to increase customer loyalty and consequently service uptake," concludes Sun. "It is imperative for fixed-line operators to enhance the quality of customer services, which will help retain existing customers and attract new ones."

Survival Strategies for Fixed-line Telecommunications Operators in Sub-Saharan Africa is part of the Communications Services Growth Partnership Services programme, which also includes research in the following markets: Kenya Carrier Ethernet Market, Mozambique Broadband Market, West Africa and East Africa Carrier Ethernet Market, Sub-Saharan Africa CDMA Market, and African Transponder Demand Outlook. All research services included in subscriptions provide detailed market opportunities and industry trends that have been evaluated following extensive interviews with market participants.

About Frost & Sullivan

Frost & Sullivan, the Growth Partnership Company, enables clients to accelerate growth and achieve best-in-class positions in growth, innovation and leadership. The company's Growth Partnership Service provides the CEO and the CEO's Growth Team with disciplined research and best-practice models to drive the generation, evaluation, and implementation of powerful growth strategies. Frost & Sullivan leverages over 45 years of experience in partnering with Global 1000 companies, emerging businesses and the investment community from 40 offices on six continents.

Survival Strategies for Fixed-line Telecommunications Operators in Sub-Saharan Africa / M514

 
 
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Fibre Optic Cables to Drive the Fixed-line Telecoms in sub-Saharan Africa Says Frost & Sullivan

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