WACS submarine cable agreement signed next week

After years of having only a single submarine cable system to serve South Africa’s international bandwidth needs, this market is set to become very competitive within the next two years.  SEACOM is on track to start operations in June, and will reach South African shores this week.

Apart from SEACOM there are numerous other systems which are planned to land in South Africa in the next two years, including EASSy, MainOne and the West Africa Cable System (WACS).

The 13 000 km West Africa Cable System, which will connect South Africa to London, will provide the African continent with an additional 3.84 Terabits/s bandwidth when it is fully operational.  

Various companies are involved in the WACS project, including Infraco, Vodacom, MTN, Neotel and Telkom.  The WACS agreement will be signed on 8 April at Vodaworld, a positive development in the quest to achieve the planned operational date of 2010/2011.

International bandwidth price reductions

The numerous cable systems, which all have planned operational dates over the next two years, are likely to significantly reduce the price of international bandwidth in South Africa.  According to industry sources the price of SAT3/SAFE based international bandwidth has already decreased by as much as 80% just because of the threat of competition from SEACOM.

It is widely punted that SEACOM will reduce the rate of international bandwidth by as much 80% when it launches operations in mid-2009, but this will not be the only price war that is on the cards.  

Chris Wood, CEO of the West Indian Ocean Cable Company which holds a significant shareholding in the East African Submarine Cable System (EASSy), said that prices can be expected to fall by a further 75% when EASSy becomes operational in 2010.

These lower international bandwidth prices should result in far higher monthly usage limits and better speeds of broadband offerings in South Africa.  Most experts however agree that the lower international bandwidth prices will take some time to filter down to consumers.

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WACS submarine cable agreement signed next week