Submarine cables still have relevance in Africa due to their ability to provide large amounts of bandwidth, says Seacom’s former group strategy and business development executive.
But Aidan Baigrie, who left Seacom in January to pursue new challenges, told the Annual Broadband Summit such firms must change their business strategy if they are to drive revenues.
Bagrie said the results of the cables landing in Africa were clear for all to see and that as demand for bandwidth increased they still had a role to play.
“We saw a huge amount of impact and some of the results were pretty crazy. Bandwidth skyrocketed,” he said. “When we landed smartphone penetration was way below 5 per cent in South Africa.
“Smartphones are now as affordable as feature phones were two years ago. Smartphones are the largest consumers of data on earth.”
He said the cables were still relevant as smartphone use increased, particularly in Africa where a growing population of a young age would be hungrily consuming data.
“Submarine cables are more relevant than ever in terms of the (bandwidth) growth we are likely to see,” he said.
Satellites were not an alternative option to the cables, he said.
“Fundamentally cables and satellite don’t compete, they work together,” he said. “It is not a substitute, it is not something that is going to make submarine cables less relevant.”
He did however say infrastructure players had to make more revenue, with over-the-top (OTT) players taking most of the “pie” at the moment.
“We will reach a point where the infrastructure companies will not make enough money to invest and upgrade,” he said. “We’ve grown the pie, we’ve grown the markets, but we never got our share of the pie ourselves as infrastructure players.
“It’s a very difficult game to maintain profitability.
“I would like to see the fibre optic submarine cable companies having more discussions with the OTT players. It’s going to reach a point where the skill sets of the cable guys and the skill sets of the OTT players meet.”
