Undersea cables for Africa

Making best use of international cable capacity: a real wind of change for Africa in 2012?

January 8, 2012
Africa

When the WACS and ACE submarine cables are commissioned in 2012, in theory the African continent will have access to more international capacity than it knows what to do with.

In reality however this is only true for coastal countries, and even here, the distribution network often goes no further than the capital city. Liberia’s capital, Monrovia, which has recently been connected to the submarine cable ACE, is a typical example.

The arrival of submarine cable links therefore leaves infrastructure providers with the task of accelerating the deployment of national backbones and cross-border links between coastal countries and landlocked countries so as to ensure that as many Africans as possible can share in the benefits of international capacity and access to data services.

With this in mind, Isabelle Gross spoke with Frederic Sallet, Vice President of Alcatel Lucent for Central and West Africa, on his company’s strategy for national backbones in Africa.

It is clear that Africa now needs to rapidly overcome the obstacles to an expansion in Internet capability, and especially in broadband Internet capacity, and to find solutions which will allow the development of more powerful data services.

Frederic Sallet believes “that most major obstacles to such expansion have been eliminated. For one thing, links with the rest of the world are no longer a problem, since both the west and east coasts have at least three submarine cables. Interconnection prices have also dropped considerably. Finally, the adoption of mobile telephony, and in particular 3G, means that end users can make full use of all capacity they are offered”.

Frederic Sallet

Frederic Sallet

One of the few remaining weak links in the chain (the other being the paucity of content, which is not for Alcatel-Lucent to sort out) is the connection between the submarine cables (the international capacity) and the 3G users (the consumers of that capacity).

In short, there is a crying need to strengthen national backbones and develop cross-border links in order to give consumers outside the main cities and in landlocked African countries greater access to international capacity.

Alcatel-Lucent is involved in multiple projects on the continent in order to meet this challenge. According to Frederic Sallet, “the pace of such projects has accelerated in 2011 compared with 2009, when many such schemes were still being conceived.

While it is possible that the pace will continue to speed up between 2012 and 2015, this will depend to a large extent on the demand generated by the growth of 3G”.

Current projects take two main forms: some are initiated by private telecom operators seeking to consolidate their regional presence by interconnecting their operations, while others are a consortium of private and public stakeholders in the telecom sector. In each of these models, Alcatel-Lucent plays several roles.

The company offers advice on the best routes and this may particularly apply to West Africa, which is highly fragmented in terms of number of countries.

In addition Alcatel-Lucent is involved in coordinating the project stakeholders and implementation of the backbone. In recent years, Alcatel-Lucent has built backbones in Algeria, Libya and Morocco in North Africa.

It is currently actively involved in a project in Mauritania with a mining company, in Guinea with the operator Orange and also in Mozambique.

Frederic Sallet explains “that there are two main forces at work that can stimulate national backbone-building strategy in Africa. Firstly; the local operator (such as Orange and MTN) may belong to a pan-African policy group that advocates such construction; secondly, some countries are open to be a public-private partnership (PPP) that involves the government and local private telecoms firms”.

The two main elements that influence how investments in national backbones are structured are the level of economic development and the nature of the legal framework governing the construction of backbones (which can vary from a monopoly held by an incumbent to a more liberal pro-competitive regime such as those in Nigeria or Kenya).

Backbones under construction and being planned for the various sub-regions of Africa will form a base-level network, which may be followed by the development of a finer network as and when the demand for capacity from within the continent permits.

In African countries as a whole there is a good understanding of the need to build or strengthen national networks, but some countries are more cautious than others when it comes to PPP projects.

According to Frederic Sallet, “Nigeria, Senegal and Kenya are currently the leaders in terms of national infrastructure”. The position in Central Africa is less advanced. Some national and cross-border sections exist, but many remain to be built.

Providing that Cameroon is willing to take advantage of the new low prices and abundance of capacity brought about by the international submarine cables, the Central African Backbone (CAB) should improve international and cross-border connectivity between it and its neighbours: the Central African Republic, and Chad. An alternative to Cameroon would be to build the exit route via Gabon and Congo.

Infrastructure is not the only barrier when it comes to bringing the benefits of international connectivity to the average African. Frederic Sallet underlines “that it is important not to neglect the services that must reside on the physical network”.

Much as the Internet itself did not flourish until the advent of the world-wide web, Africa’s Internet-driven renaissance will also depend on the development of the “IP layer” that will permit firms to access services such as VPN (virtual private networks), and videoconferencing.

If the price trends as regards capacity on the national backbones and cross-border links follow those for international capacity (and there are many reasons why this is likely to be the case), those telecom operators that do not expand their portfolio of services, in particular through the introduction of value-added services, will see their sales figures languish.

As we have seen in Europe and the US, in the face of commoditisation of mobile pricing, simply selling capacity is unlikely to be sufficient to allow telcos to make ends meet.

Source: Balancingact-Africa

Tags: africa, Alcatel-Lucent, Frederic Sallet, Headline, MTN, Orange

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