$2.94bn submarine cables to revive Nigeria’s fixed line telecoms


By Alex C

Large amounts of high-capacity international bandwidth lying idle on Nigeria’s coastline is sparking off the resurgence of fixed line (wired) telephony as telecommunications companies begin build out requisite infrastructure needed to take internet services across the length and breadth of the country, market observers have said.

An estimated $2.94bn have been ploughed into the deployment of five submarine cables, with these internet infrastructures easing the long standing constraint of high capacity bandwidth required to drive data hungry services such as e-health, e-commerce, telemedicine, e-government, e-banking, amongst others. According to experts, fixed line infrastructure offers faster and stable speeds, and are not susceptible to bad weather conditions as opposed to wireless and satellite services.

“The key growth drivers for wireline telecoms are the increasing demand for data and Internet services, cost-effective deployment of fixed-wireless technologies, and the introduction of fibre-optic cables,” said Jiaqi Sun, research analyst, Frost & Sullivan. These are however not the best of times for the fixed line segment of the country’s vibrant telecoms market as operators lost more than 56 percent of their active lines in the past one year, according to statistics from the Nigerian Communications Commission (NCC).

But, there are signs of improvements, as Mobile Network Operators (MNOs) in Nigeria, Africa’s largest economy by GDP, were engaged in a heated race to deploy fibre infrastructure in unserved parts of Lagos, the commercial nerve centre of Nigeria.

Ejovi Aror, chief executive officer, ipNX Nigeria Limited, a leading broadband service provider, pointed out that the cost of broadband service has reduced significantly at the wholesale level due to the coming of a number of submarine cable systems. MainOne, Glo-1, West African Cable System (WACS), ACE, and SAT-3, are offering about 10 terabits per second of international bandwidth capacity.

Market analysts are of the view that the reduction in international bandwidth prices has not translated into efficient and affordable services for the consumer. “Telcos have not been able to move available bandwidth capacity from the shores to the hinterland. The fixed line infrastructure required to make broadband available in homes, hospitals, schools is gradually been built”, added Aror.

Telecoms companies, such as ipNX, Vodacom Business, MTN, Globacom, are making investments in new technologies like Fibre-To-The-Home, Voice over Internet Protocol (VoIP), Internet Protocol Television (IPTV). Though coverage and adoption is still very limited in Nigeria, these new technologies have the potential to drive the resurgence of fixed line telephony.

Eugene Juwah, executive vice chairman, NCC, noted the reason why mobile broadband in Nigeria is not working pretty well, is due to the absence fixed broadband infrastructure. “There is no in-land fibre to backhaul all this capacity back to their various switches”, he further added.

The NCC is making a regulatory intervention into the provision of fixed line broadband, so that an infrastructure sector is created which includes within itself, a sophisticated sharing of resource. The commission is working assiduously to license seven regionally based Infrastructure Companies (InfraCos) soon.

These InfraCos, will accelerate the deployment of a nationwide metropolitan and backbone fibre network on an open access, non-discriminatory, price regulated basis. Interested telcos have already began to prepare bids for licenses.

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