Subsea Special: Subsea cable market trends

10 January 2013

Brought to you in collaboration with TeleGeography.

Growth in global demand for international bandwidth declined in 2011 for a third straight year. Although the pace of growth has slowed, demand still increased at a robust rate of 45%.

TeleGeography reports that carriers had a total of 67Tbps of capacity on their international IP, private and voice networks in 2011 - six times the 11.1Tbps in service in 2007.

Bandwidth demand growth varies geographically, primarily based on the level of network adoption in the region. Demand growth has been strongest on links to less developed regions such as Africa, the Middle East and Latin America. 


Although the amount of lit capacity has increased on all major undersea routes, potential capacity is also growing, and a large amount remains untapped.

Potential capacity is an estimate of a cable's maximum capacity on the basis of existing technologies. While the proportion of lit capacity has remained rather low on many routes, the exception had been the Europe-Asia route via Egypt.

In 2008, lit capacity between Europe and Egypt was equivalent to 77% of potential capacity. The entry of several new cables on the route dramatically increased potential capacity, and the lit-to-potential capacity ratio fell to 11% in 2011.


Between 2011 and 2013, a total of 38 new submarine cables with an estimated construction cost of $5.6 billion are expected to launch.

Asia is seeing the most new submarine cable construction, while several projects are also underway in Africa, the Middle East, Latin America and the transatlantic.

The costs of these new systems vary widely. Of all the cables in recent development, the Africa Coast to Europe (ACE) and West African Cable System (WACS) cables carried the heftiest price tags at around $700 million and $650 million respectively.

Conversely, shorter, more regionally focused systems like the Taiwan Strait Express-1 are often constructed for less than $40 million.


Contact TeleGeography 

T: +1 202 741 0020

Topics: subsea, market trends, TeleGeography