Fixed Wireless Access (FWA) has proven to be a serious competitor in fixed broadband technologies, and the adoption of the service is beyond the tipping point.
This is one of the key findings of the Africa Digital Infrastructure Market Analysis 2021 report.
Compiled by Digitalthings on behalf of Digital Council Africa, the market analysis report examines the state of key digital infrastructure developments in Sub-Saharan Africa (SSA). It examines the digital infrastructure environment in the region, with a deep dive into some African markets.
In terms of digital infrastructure categories, the analysis focuses on terrestrial fiber deployment, international connectivity, submarine cables, satellites, data centers, last mile fixed connectivity, infrastructure towers, cloud and data, among others.
The report points out that FWA is, in many cases, the fastest alternative to meet the growing demand for broadband services, especially in areas outside of fiber coverage.
In addition, the highest growth in the first half of 2021 was recorded in the regions with the lowest fixed broadband penetration, namely the Middle East and Africa, Central and Eastern Europe, Asia-Pacific and Central and Latin America.
Bora Varliyagci, CEO of Digitalthings and lead researcher on the report, told ITWeb that in the future a combination of fixed wireless broadband and fiber will jointly develop.
According to Varliyagci, this will not only be a feature of the SSA region, but a global trend.
The current state of fixed connectivity in the Digital Council report shows increasing adoption of fixed wireless fiber-to-home / business and LTE / 5G connections. This, he points out, is evidence of a decrease in the DSL footprint year over year, especially in markets such as South Africa.
“There has been a decline in DSL subscriptions which are mostly replaced by fiber, but the most important is the significant adoption of the service offering as well as the adoption of services over the fixed wireless network. ”
Fiber deployments continue at a steady pace in mature markets like South Africa, Kenya and Mauritius, which remain the main markets in Africa, he adds.
The report highlights South Africa as the fastest growing market over the past year, with fiber-based broadband subscriptions surpassing one million in 2021. This, notes it represents almost half of the fiber-based broadband subscriptions in sub-Saharan Africa.
The southern African nation is followed by Kenya, which is growing towards half a million, and Mauritius with more than 300,000 subscribers. Meanwhile, progress in all other markets in the region has been relatively limited, he says.
“The overall penetration of fiber broadband services in households remains below 2% in most countries in sub-Saharan Africa, with the exception of major markets such as Mauritius, South Africa and Kenya. “
Bora Varliyagci, CEO of Digitalthings.
Closer to home, Varliyagci says there has been massive growth in the fiber market in South Africa, which now stands at 1.16 million subscriptions in March, up from around 760,000 last year.
He points out that fiber optic networks have passed through 2.56 million South African homes to date.
“We have seen subtle growth in other markets,” he notes. “Deployments are now moving to a larger region in terms of underserved areas and lower areas of LSM. In other markets, deployments are very limited to urban, dense, high-income areas and move slowly.
“There is also a strong adoption of fixed wireless broadband in the market. All operators have a fixed wireless offer, and it is a rapidly growing market. We expect 1.6 million additional subscriptions on fixed wireless 4G and 5G subscriptions. This will bring home fixed broadband subscriptions to around 2.8 million, and will include not only fiber, but also LTE and 5G delivered over fixed wireless. “
For Varliyagci, there are a number of reasons for the growth of FWA connectivity, including LTE reach in countries like South Africa, which he says is quite extensive. “You have LTE coverage almost everywhere, exceeding 95% population coverage.
“Fixed wireless broadband is a fairly lucrative market as operators leverage the assets invested, so it is in the operator’s best interest to monetize it as soon as possible.
“It won’t stop fiber deployments across the country, but if you’re moving out of large areas or secondary cities, it’s much faster to activate fixed LTE or fixed 5G service compared to fiber. As the fiber obviously grows, these alternatives are also capturing the footprint. ”
Based on the report, the global market size for fiber optic submarine telecommunications cables was valued at $ 23.4 billion in 2020 and is expected to reach $ 37.8 billion by 2027. The expected growth is at a compound annual growth rate (CAGR) of 7.1%. from 2020 to 2027.
The report describes submarine cables as the backbone of digital infrastructure, carrying around 90% of data traffic around the world.
In the case of SSA or Africa in general, the submarine cable system has grown at a CAGR of 45% over the past four years, with no signs of slowing down, Varliyagci explains. Overall, the average CAGR is around 29%, he reveals.
“Sub-Saharan Africa’s growth has far exceeded global growth trends and this is in part because it is also coming from a smaller base. As we have seen in recent years, the OTT [over-the-top]Driven submarine cable systems, like Equiano and 2Africa, will eclipse existing capacity on the continent, even adding almost 10 times the capacity as they come into service.
“This is the current trend that is bringing more and more capacity to the continent, and one way or another this capacity has to be transferred inland. ”
In the terrestrial fiber network space, Varliyagci says that across Africa there have been projects going on, especially around central Africa this year. “We have seen quite a few announcements coming out of the DRC because there are a few operators who intend to bridge this east-west divide in the middle of Africa.”
In other regions, regional and national interconnection projects are underway, so there is no slowdown, he says.
However, the principal researcher maintains that there is still a lot of gap to be filled from the point of view of sub-Saharan Africa. Consequently, no slowdown is expected in the deployment of terrestrial fiber.
The continent barely reaches 1.2 million kilometers of operational fiber footprint, with an additional 200,000 kilometers to be added within a year or so, Varliyagci concludes.