The document discusses broadband connectivity trends in Africa over the next 5-8 years. It finds that Africa will experience rapid urbanization and the growth of regional economic corridors. By 2020, over 70% of Africans will live in cities, and integrated infrastructure will link major population centers. Broadband access is also expected to grow substantially, with mobile internet penetration reaching 90% by 2020. Terrestrial fiber networks will be critical to unlock bandwidth from new undersea cables and connect inland areas. The future of Africa's digital economy depends on continued investment in broadband infrastructure and regional integration projects.

1. The future of broadband:
What bandwidth evolution can Africa expect in the future
April 2012
Broadband Confex
Chantel Lindeman

2. Agenda
Megatrends impacting Africa
Urbanisation
Regional integration
Future Infrastructure
Connecting the unconnected
Current broadband situation
Future impact of bandwidth
Competitive playing field
Future connectivity platforms
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3. Africa – The Dark Continent
C. Mayhew & R. Simmon (NASA / GSFC). NOAA / NGDC, DMSP Digital Archive
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4. The megatrends impacting the ICT sector in Africa over the next 5 to 8 years
Regional
Integration
Urbanisation
Connecting the
Unconnected
Future Infrastructure
Source: Frost & Sullivan analysis.
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5. As a region, Africa will possess the second largest number of urban occupants
by 2020
Asia
North America Europe
533
288
560
340 1,757
Africa
2,383
Latin America
and Caribbean
Oceana
412
468 660 25
560 30
2020
2010
Urban
Population
(million)
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6. Seventy % of urbanised Africa will live in informal settlements
Splintered Urbanisation Major Informal Settlements, Africa, 2050
African urban communities will comprise 70 per cent Chad
informal settlement dwellers living alongside an 99.4% of the
emerging middle class roughly equal to that of India population live in
informal settlements
Ethiopia
99.4% of the
population live
in informal
settlements
Lagos
75% of the population Nairobi
live in informal Kibera > 1
settlements million people
Kinshasa Maputo
Percent of Urban Residents by Type of Settlement, Africa,
2050
70%
30% not living in in informal Luanda
informal settlements Cacuaco >
settlements 600,000 people Johannesburg/
Pretoria
Cape Town Soweto
Khayelitsha
Source: UN-Habitat, Frost & Sullivan analysis.
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7. African cities will require resource efficient technologies to meet social
challenges and business opportunities
Cairo
Cairo is expected to grow from 11
million in 2010 to over 13.5 million by
2025; it is the only mega city, by
definition, in Africa.
Lagos and Eko Atlantic City Region
Lagos’s Eko Atlantic City will merge
with the city of Lagos to form a future
business gateway to Africa—a
mega region of over 16 million.
North South Corridor
Transport routes across the region will
be expanded and integrated to create
corridors for trade and inter-
continental co-operation by linking
mega cities.
Source: Frost & Sullivan analysis
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8. Corridors will unlock economic potential of landlocked countries and will
improve inter-dependence among cities, leading to regional economic growth
Mega Corridors, Africa, 2050
The North Delta Region
1,000 km Abidjan-Ouagadougou • Combined population of 77
Alexandria Cairo
Corridor million
• Three emerging corridors:
Cairo-Suez
Cairo-Alexandria
Cairo-Ismailia.
Ouagadougou Addis Ababa
Abidjan 900 km Kampala-Nairobi-
Ibadan
Mombasa urban corridor
The Greater Ibadan Lagos Accra Accra
(GILA) Corridor Lagos Nairobi
• Combined population >18 million
• Contributes combined GDP of Kinshasa Dar es Salaam
$127,592,000.
Luanda North-South Corridor
• Facilitate inter-regional trade
Trans-Cunene Corridor from Cape to Cairo.
• Will link the Democratic Republic of • Free trade area comprising 533
Congo (DRC) with South Africa million people.
through Angola and Namibia. • Combined GDP of $833 billion or
58% of Africa’s GDP.
Main Developed Corridors Cape Town Johannesburg/
Future Corridor Development Durban Pretoria
Source: UN-Habitat, 2010, Frost & Sullivan analysis.
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9. An integrated continent – development in intra-trade and key infrastructure
development
Power, Transport and Trade Integration (Africa), 2010 – 2020
Total Intra-trade:
$216 billion
Power Interconnection
Investment: $50 billion
Regional Transport
Investment (road, rail): $30 billion
ICT Infrastructure
Development: $60 billion
` Planned Electricity Interconnections
Road Infrastructure development
Trilateral Free Trade Agreement (T-FTA)
Source: Frost & Sullivan Analysis
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10. Agenda
Megatrends impacting Africa
Urbanisation
Regional integration
Future Infrastructure
Connecting the unconnected
Current broadband situation
Future impact of bandwidth
Competitive playing field
Future connectivity platforms
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11. Markets with 80% broadband penetration are more than twice as innovative as
countries with 40% Penetration
Mobile, Broadband, and Internet Penetration per Region, Global, 2009 and 2020
140%
Europe
North America 123%
110%
90%
100%
100% 100% 90%
82% 70%
68% 56% 110% Asia
65% 75%
56%
21%
Africa
11%
Latin America
90%
60% Oceania
120%
112%
95%
Mobile Penetration 2009 91%
50% 41% 83% 70%
85% 82%
Mobile Penetration 2020 27% 8%
57%
Broadband Penetration 2009 4%
Broadband Penetration 2020 9%
Internet Penetration 2009 7%
Internet Penetration 2020 Source: 2009 telecommunications statistics from ITU,
2020 projections from Frost & Sullivan
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12. Annual growth rates of 9% to 2020 will allow Africa to reach a mobile
penetration rate close to market saturation
Mobile Telephony Penetration Rate, Africa, 2010 Mobile Telephony Penetration Rate, Africa, 2020
Mobile Phone Subscriptions
• In 2010, African mobile
penetration is just less than
50 per cent.
• That said, several countries
have reached saturation.
• By 2020 we expect a 90 per
cent mobile penetration
rate.
80–100%
$80 billion investment
60–80%
in networks
40–60%
20–40% Low cost mobile
<20% phones
Value-added Services
500 million 1,170 million
Source: Frost & Sullivan, 2011
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13. Announcement of additional submarine cables to BRICs in saturated
undersea cable market is concerning – terrestrial fibre is key
• Terrestrial fibre will unlock the vast
amounts of bandwidth available from
undersea cables
• Fibre vendors, telcos and municipalities
have began investing heavily in
infrastructure
• Mobile broadband and data centres are
driving the revenue and subscriber
growth rates
• Landlocked countries have access to
EASSy and WACS through incumbents
• ISPs still have access issues to
backhaul services.
Source: Steve Song Map and Ubuntu Alliance, 2012
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14. By 2020, $4 billion is expected to be invested in submarine fibre cables and $56
billion on terrestrial networks
Submarine Fibre Optic Landing Points, Africa, 2020 The number of major
ISPs will increase from
20 to 25
Thirteen undersea
cables will result in a
90 per cent decrease
in the wholesale cost
of international
bandwidth
Revenue from data
services to reach
$137,000 million in
2010
1 to 3 cables
4 or more cables
Landlocked country with
access to submarine Mobile operators
cable will be the ISPs
Terrestrial fibre links
Sub marine cables – Multiple cables
Source: Frost & Sullivan, 2011
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15. DSL adoption is expected to decline whilst mobile broadband leapfrogs in
uptake
Total Broadband Market: Technology Adoption Trends (Africa), 2010
High Introduction Growth Maturity Decline
Dial-up Access
Adoption Rate
Mobile DSL Access
Broadband
Satellite
WiMax
LTE
Wi-Fi
Low
Technology Stage Source: Frost & Sullivan analysis.
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16. In response to the declining voice revenues, existing operators are focusing
on providing broadband services to both businesses and consumers
Total Broadband Market: Competitive Structure
Number of Companies in the Market More than 255
Cost, performance, schedule, support, technology, reliability,
Competitive Factors
contractor relationships, customer relationships
Key End-user Groups Consumers, SMEs and Enterprises
Major Market Participants* Vodacom, MTN, Telkom, Orange and Econet
Market Share of Top 10 Competitors 80%
Other Notable Market Participants Internet Solutions, Africonnect, PowerTel, Africom
Distribution Structure Direct sales
Vodacom Gateway Mauritus acquired Africonnect; Lap Green
Notable Acquisitions and Mergers acquired 75% of ZAMTEL, Liquid Telecom acquired 49% of
Ecoweb.
*Major market participants by broadband technology Source: Frost & Sullivan analysis.
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17. Government will drive future investments in order to facilitate growth in the
business sector
• Collaborated infrastructure expansion and sharing Total Broadband Market: Strategic
Conclusions
has increased broadband penetration
• The influence of undersea cables cannot be denied
‒ Broadband prices have started to decrease in the region Further Infrastructure
consolidation expansion and
‒ ISPs and mobile operators have already started to take expected sharing
advantage of this
• Regulator facilitation of spectrum allocation will
enhance deployment of technologies like WiMax and Influence
Managed of
LTE services Broadband undersea
pushes Market cables
• Effective customer segmentation is crucial for ISPs to broadband
market
properly differentiate themselves
• An increased demand for managed services pushes
the broadband market Effective
customer Spectrum
‒ Data centres, storage and converged communication segmentation allocation
crucial
• Frost & Sullivan expects further consolidation,
especially between tier II and III operators
Source: Frost & Sullivan analysis.
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18. Connectivity will generate $200 Billion in opportunities for
networked sectors by 2020
`
Seventy per cent of electrified ICT innovation will be a
households to use remote metering major employer of skilled
of electricity and automatic load manpower
staggering–$20 billion will be
invested
Five per cent of cities will deploy One hundred per cent of
intelligent transport systems for terrestrial TV broadcasting
traffic management–$10 billion will will be digital–$4 billion worth
be invested in these systems of set-top-boxes to be sold
Forty per cent of hospitals will be
networked with pharmacies and Ten per cent of urban office
doctors–$40 billion will be spent on staff will work from home and
hospital ICT equipment use broadband networks
Seventy per cent of all banking transactions will use mobile
technology–$300 billion to be transacted
Source: Frost & Sullivan, 2011
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19. Youradditional information
For Contact For Additional Information
Chantel Lindeman
Business Unit Leader – ICT Africa
http://www.frost.com
Tel: +27 21 680 3205
Mobile: +27 82 555 3851
E mail: chantel.lindeman@frost.com
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