Update on fibre
deployments in South Africa
& drivers and inhibitors
Tim Parle
Senior Telecoms Consultant
@timpbmit
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Agenda
National long distance networks
Update on fibre deployments in South Africa
National long distance routes
Source: BMI-T,2014
National long distance routes
including Broadband Infraco
Source: BMI-T,2014
National long distance routes
including Broadband Infraco
and Telkom
Source: BMI-T,2014
National long distance routes:
Planned or proposed
Source: BMI-T,2014
NLD route distances (current and future)
FibreCo
Cobuild
Liquid
SAS
DFA
BBI
Telkom
As built As built plus known
build programme
Source: BMI-T,2014
Source: BMI-T,2014
Cooling off of submarine cables projects, upgrade of
existing systems
Source: ManyPossibilities, 2014
Metro fibre networks
Update on fibre deployments in South Africa
The FTTB/FTTP market heating up
Consolidation in the market
Metro municipality tenders and development
Fibre optic tender
August 2014
Broadband tender
October 2014
3rd party use of fibre
April 2014
MetroConnect
continues
LinkAfrica?
1000km network
build completed in
2013
It’s not all plain sailing: Legal wranglings
Access and FTTx networks
Update on fibre deployments in South Africa
The most exciting news of the year?
Telkom has shown its cards
Source: Telkom,2014
Telkom - the Wildcard in the FTTH market?
Source: Telkom,2014
Telkom FTTH suburbs
Source: Telkom,2014
Changing price of ADSL services (at Telkom rates)
R -
R 50
R 100
R 150
R 200
R 250
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
Average cost per GB of ADSL bandwidth
Min Average Max
R -
R 2 000
R 4 000
R 6 000
R 8 000
R 10 000
R 12 000
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
Average annual cost to user of ADSL service
Source: BMI-T,2014 NB: excluding line and ADSL service costs NB: includes line and ADSL service costs, 12 m TCO
Drivers Inhibitors
FTTH drivers and inhibitors
Global content consumption trends
IPTV: global revenue 11.8% CAGR, reaching $43bn in 2018*
Supply-driven trends, e.g.
Telkom or Vodacom partners with Netflix?
What MultiChoice does
Mobile operators ‘bridging’ with wireless access
Risk-taking by property developers (e.g. Century) and telcos like Telkom**and Neotel (Maboneng)
Business case
Fibre is expensive compared to the cost of a standard DSTV subscription via satellite, plus a broadband service based on ADSL or wireless alternatives.
DSTV’s grip on sport content, and the reasonable pricing of its bouquets, especially when compared against the alternative of a fibre-based connectivity service.
Require high residential density for reasonable ROI.
26 *China, France and the US account for half the global IPTV market.
**Telkom FTTH pilots in Rosebank, Bryanston, Waterkloof, La Palma and Plantations in Durban. 45 customers.Technical trials
underway in three gated communities. Telkom has earmarked end 2014 for commercial launch of FTTH.
Neighbouring countries / Southern Africa
Update on fibre deployments in Southern Africa
Fibre development in Southern Africa
Source: AfterFibre, 2013
Road lengths in neighbouring countries
0 50000 100000 150000 200000 250000 300000 350000 400000
Botswana
Lesotho
Mozambique
Namibia
South Africa
Swaziland
Zimbabwe
Paved
Unpaved
Source: United Nations, BMI-T, 2013
Fibre and optical technology
Update on fibre deployments in South Africa
Evolution of DWDM capacity
0
2
4
6
8
10
12
14
16
18
20
Syste
m c
ap
acit
y i
n T
bp
s
Evolution of DWDM capacity (Commercial systems, single fibre pair)
Coriant Sets Guinness World Records® Title
with the World’s Highest Data Transmission
Rate Over Hollow Core Optical Fiber
Coriant Continues Its Push For Innovative, Bleeding-Edge Research
NAPERVILLE, Illinois, 3 June 2014 – Coriant, a global supplier of
dynamic metro-to-core transport solutions, announced today that
Guinness World Records has certified Coriant's achievement of the
world's highest data transmission rate of 57.6Tb/s (gross rate of
73.7Tb/s) over hollow core optical fiber. This award becomes the
Company's first fiber optic feat to be recognized by Guinness World
Records, which is the authority on record-breaking achievements
around the world.
Record breaking
Source: Image credit MyBroadband, 2014
South African provincial broadband projects
Update on fibre deployments in South Africa
Progress with provincial broadband projects
Legal and regulatory developments
Update on fibre deployments in South Africa
Change in DoC to DoC & DOTPS in 2014
Size of the market:
2 mobile operators since 1994/5
1 fixed operator until 2005
400+ individual licensees since 2008
probably around 40 are operational today
Changing landscape
0
200
400
600
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
Active licenced telecoms operators
At the end of October 2014, four Councilors end their term of office
The Minister of the DOC has told them to leave
No need for a handover
The Minister would like to change the number of councilors from 9 to 5
The CEO may gain a vote on the Council
….. despite the provisions of the ICASA Act, which has only just been amended
ICASA changing shape
Source: Incyte Consulting, BMI-T, 2014
There will be little if any movement on land access and rapid deployment guidelines this year
ICASA has yet to publish reasons for its General Licence Fee Regulations
Despite the expiry of the PAJA deadline in August
ICASA is unlikely to publish any ownership and control regulations for comment for some time and the previous findings seem to have disappeared
Regulatory outlook
Source: Incyte Consulting, BMI-T, 2014
The four pillars of SA Connect:
Digital readiness
Digital future
Digital opportunity
Digital development.
National Broadband Policy: South Africa Connect
SA Connect could languish in a drawer
We will probably talk about “access” in terms of coverage because rural areas
have patchy electricity, no access to devices, and very little understanding of
what the internet is or what it can be used for
Operators also have little incentive to cover these areas because they are
uneconomic
The ambitious speed targets could become largely irrelevant while we decide
what “open access” is and if any licensee/SOC should take the role of the
open access provider
The progress made in so many other developing countries in e-government,
e-education and e-medicine might be noticeable only by its absence
Some more loose ends:
12 Source: Incyte Consulting, BMI-T, 2014
The end of the road (for today)
Update on fibre deployments in South Africa
Summary and conclusions
NLD network consortia being revised and holding back for next wave
Delays benefit incumbent providers
New build submarine projects rationalised & existing routes upgraded
Metro municipality fibre and broadband projects again in vogue
Implications of unnecessary duplication in fibre building coming to roost?
FTTB is hotting up with consolidation in the market
Vodacom & Neotel, DFA & Conduct, LinkAfrica & ???
FTTH made great strides in 2014
Parkhurst is the innovative project
Telkom remain the wildcard
Summary and conclusions
Provincial projects started in Gauteng and Western
Cape
Preliminary steps in other provinces
DWDM technology advances provide new life to old fibre
(routes) and defer the need for investment in new routes
Decision to split the Ministry of Communications and
create the Ministry of Telecommunications and Postal
Service has hampered progress
Long-tail effect
Rapid deployment guidelines on ice
Green shoots for SA Connect
Regulatory uncertainty remains – investor confidence?
45
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