Bandwidth for Africa

Brian Herlihy cannot contain his excitement. He’s the man behind the Seacom consortium, which is building the new US600m undersea telecommunications cable that will connect SA with East Africa, India and Europe.

Seacom has already begun erecting the landing stations that will bring high speed Internet access to countries in East Africa for the first time.

Herlihy says the cable has the potential to bring cheap broadband to the region and change the way people on the continent communicate.

The 15 000km system, which should go live by June next year — in plenty of time to carry television signals from the 2010 soccer World Cup in SA — will ultimately carry data at about 11 times the design capacity of the established Sat-3 system that runs along Africa’s west coast.

Seacom is 50% held by SA investors — VenFin (25%), Cyril Ramaphosa’s Shanduka (12,5%) and Andile Ngcaba’s Convergence Partners (12,5%). It has begun construction of a landing station in Maputo that will serve as a route for Internet traffic into Johannesburg. The consortium is also building a station at Mtunzini in northern KwaZulu Natal.

Herlihy says the shareholders should make a return on their investment within five years, despite charging significantly less for bandwidth than it costs to lease capacity on Sat-3. Of course the costs on Sat-3 have been kept high by Telkom, which until recently controlled access.

“Bandwidth uptake could be higher than our original forecasts, which would mean an even earlier return on investment,” Herlihy says. “It’s difficult to forecast as demand is incredibly elastic.”

Telkom’s new rival, Neotel, will land the Seacom cable in SA. In Kenya and Tanzania, where Seacom doesn’t have to partner a licensed operator, it is landing the cable itself. In Mozambique, CapiTel is its partner.

The cable has a design life of 25 years but could last much longer than that. It will be filled to capacity long before then, though. Herlihy says other cable systems have typically been fully leased within eight years of being built.

Though traffic on the cable initially will be mainly between Europe and Africa, Herlihy expects traffic on the India leg to grow exponentially in the next few years. “Within five years, 25% 30% of the traffic will go towards Asia and within 10 years it will be 40%-45%,” he says. “That portion of the cable will be a valuable asset, not on day one but within a few years.”

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Bandwidth for Africa