‘Nigeria, Ghana, others are untapped markets for fibre optic investments’
Large markets such as Nigeria, Ghana, South Africa, Brazil and some parts of Asia have huge potential to attract digital infrastructure projects but are untapped markets for fibre optics investments.
Findings by Boston Consulting Group (BCG) and EDHECinfra, a venture of the renowned international EDHEC Business School, which discovered this, linked the inability of these markets to attract required investments to uncertain economic growth that has made fibre-penetration levels uneven despite a clear demand for fiber infrastructure projects.
With the findings documented in a new report entitled “Infrastructure Strategy 2022: A Pivot to the Digital Frontier,” BCG and EDHECinfra provided a new perspective on the investment strategies and risk-adjusted-performance of different groups of infrastructure investors.
“Although demand for fiber optic projects is most pronounced in less-wealthy economies—large and diverse regions with significant potentials, such as Nigeria, Ghana, South Africa, Brazil, and parts of Asia are untapped markets—fiber penetration is also uneven in places where economic growth is less uncertain,” the report stated.
The study, which was released on Monday, pointed out that the increasing desire for higher speeds and reliable online access will inevitably lead to a huge expansion of fiber optic installations in new networks in low and middle-income nations as well as in existing networks in higher-income countries. It stressed that ultimately, fiber, which has already begun to make inroads in networks everywhere, will replace legacy (primarily copper) infrastructure completely, particularly as 5G rolls out.
Commenting on the findings of the study, Managing Director and Partner, BCG Nigeria, Stefano Niavas, said, “Fibre optic investment is required to expand the capacity of the undersea cable infrastructure on the shores of Nigeria beyond the cities to other regions of the country in order to make connectivity truly ubiquitous.
“With the growing demand for fast and reliable Internet connectivity, investing in digital infrastructure is profitable and it is expected that investment in fibre installations all over the country will accelerate in a few years from now.”
The report also revealed a pivot to the digital frontier. According to it, as the analysis showed, all investors are planning to overinvest in digital infrastructure going forward.
While this also entails data centers, towers, satellites, and subsea connections, the appetite for broadband connectivity remains high.
BCG Managing Director and Partner and a co-author of the report, Roman Friedrich, explained: “The increasing desire for higher speeds and reliable online access will lead inevitably to a huge expansion of fibre optic installations in new networks in developing nations as well as in existing networks in more developed countries. Ultimately, fiber will replace legacy (primarily copper) infrastructure completely, particularly as 5G rolls out.”