Africa’s broadband market has taken off after years in which it had been held back by an expensive operating environment created by Telkom’s dominance in the fixed-line and international bandwidth market. Wireless broadband services have carved out market share from existing ADSL offerings, though this is dominated by mobile network operators. Several WiMAX networks have been shut down as consumers migrate to 3G and LTE mobile networks for internet connectivity. Given that its fixed-line network reaches less than 10% of the population, Telkom has responded to these market pressures by launching its own mobile network, and so is able to tap into burgeoning consumer demand for internet services and mobile broadband. At the same time, Telkom is also facing increased competition in the fibre optic sector.

The landing of four international submarine fiber-optic cables in South Africa between 2009 and 2012 has brought down the cost of international bandwidth dramatically. Additional cables with terabit capacity have come on stream during the last three years. Previously, Telkom monopolized access to the only major cable serving the country, and so was able to demand very high access prices. A new converged licensing regime has created hundreds of companies licensed to offer internet services.

More internet investment needed to sustain Africa’s economic growth, there remains considerable activity and investment in Africa’s national and international broadband infrastructure. Many countries have a range of government programs in place aimed at increasing bandwidth availability, and at extending networks deeper into non-urban areas. Submarine cables now provide 20-times more international bandwidth than was the case in 2010: international bandwidth broached 2Tb/s by the end of 2013. In North Africa alone, bandwidth increased 36% in the year, while in Sub-Saharan Africa it grew 39%. Submarine cables have been designed with vast capacity, and by mid-2015 barely 8% of capacity was being utilized.

Rising internet penetration, more marked in some countries than others, is required for the development of applications and services, and to drive growth in local economies. Penetration rates of at least 20% are needed for real socio-economic benefits to be realized. This level of internet connectivity is realistically achievable only through mobile networks. Many countries in Africa have such poor fixed-line infrastructure that telcos and vendors and better placed to invest in mobile infrastructure alone rather than in fixed-line networks. In rural areas as well as in many semi-urban zones mobile networks present a more realistic option for providing voice and data services cost effectively and quickly. This is already the reality in many markets, while regionally about 90% of all internet connections are already provided by mobile broadband.

Department of Telecommunications allocated ZAR1.4 billion from the 2015 budget to pursue broadband initiatives; Telkom makes bid to buy BCX for ZAR2.7 billion; Multisource makes bid to acquire iBurst and WBS; Vox Telecom’s owners cancel plans to sell up; Neotel halves price of fibre broadband; cost of international fibre bandwidth reduced following end of monopoly; LLU creates new opportunities for fixed broadband players; Google tests wireless broadband using ‘White Space’ spectrum; Telkom assesses plans to convert public payphones into WiFi hotspots; MTN connects first customers to its FttP network; MWEB launches Fon-enabled WiFi routers; Vumatel extends open-access network offering 1Gb/s services.

These developments are encouraging for the future growth of the regions fixed-broadband sector, which will further drive economic progress as well as a range of benefits based on enhanced social inclusion among consumers. Nevertheless, socio-economic forces in many markets has also made theft and vandalism a real concern for operators, while political instability in countries such as Libya has caused considerable upheaval and disruption to services.