Predictions were rife, not so long ago, that the demand for satellite connectivity would fall away as fibre was increasingly laid in African cities, offering fast and cheap broadband internet to the doorsteps of homes and offices.
In fact, the opposite has proved to be the case, with demand for faster service and the increasing need to serve non-urban areas, meaning satellite is more in vogue than ever. The consensus now is that fibre and satellite must not only coexist but also work hand-in-hand to reach the web penetration of developed regions.
In Africa, 2G and 1G networks are too slow to provide the necessary high-speed data and broadband, with mobile operators increasingly using satellite services as backhaul. Moreover – and more importantly – it is estimated that in excess of 300 million Africans are 50 km or more away from fibre or cable broadband connections, hindering provision. It is here that satellite has become key.
Scott Mumford is the satellite services group head at Liquid Telecom, which provides both fibre and satellite capacity in Africa. He says that while the continent’s main metropolitan areas have had fibre laid and rings put around them, demand for coverage from smaller, less populated areas is also growing.
‘Of course, people in smaller towns and more rural areas want to be connected to the internet, like their friends and family in the cities,’ he says.
‘In addition, many companies are also asking us to provide connectivity to offices and teams located outside the main urban areas. And, of course, these locations need the same high-quality service.’
This increased demand has coincided with developments within Africa’s satellite industry, making it a more reliable and cost-effective alternative to fibre.
Mumford says that until around five years ago, nearly all of the continent’s connectivity was in the C-Band, and that systems were extremely expensive.
‘Then the change to Ku-Band started to happen and this dramatically changed the landscape,’ he says, adding that the advent of the DVB-S2 standard and the implementation of adaptive coding and modulation has allowed the Ku-Band to be used, reducing its sensitivity to rain.
‘The effects of rain can be mitigated to a large degree, the throughput rates are much higher and the cost per megabit and the cost of the equipment came down massively, so the global market exploded overnight,’ he says.
Technological development is continuing, with Ka-Band satellites now being launched over Africa. These have much wider bandwidth transponders and considerably narrower beams, providing a greater ability to connect more users to the internet. This in turn makes satellite a much more attractive commercial proposition for providers.
Gilat Satcom MD Eran Yoran agrees that technological developments – such as high-throughput satellites – coupled with decreasing prices and the stability, reliability as well as the removal of the need for local infrastructure, has made satellite an especially viable option as the need for connectivity grows.
As a result, investment has increased substantially. ‘Satellite vendors are investing heavily in expanding their infrastructure to provide a better service,’ says Yoran. ‘ISPs invest in order to provide the end users with good connectivity solutions.’
Mumford says there has been ‘massive investment’ in satellite across Africa.
‘There are a number of new satellites being launched, some with all of the connectivity being provided from Africa. These satellites are in the region of US$600 million investments from the operator, based on at least a 17-year time frame,’ he says.
In 2014, Liquid Telecom became the first operator to build a satellite hub at Teraco’s vendor-neutral Earth station in South Africa.
‘We are investing heavily in both our satellite service and our fibre networks, as we are committed to building Africa’s digital future,’ says Mumford. ‘Teraco is the most connected point in Southern Africa and enables us to keep African traffic in Africa. Other operators are still backhauling traffic via Europe, which increases latency and decreases speeds.’
Other companies are also stepping up investment and development. UAE satellite company Yahsat announced this year that its Al Yah 3 satellite had passed its preliminary design review and is set to launch in the final quarter of 2016.
Al Yah 3 is expected to provide affordable internet services to 600 million people in 17 countries, which is some 60% of Africa.
The satellite features Ka high-throughput technology, which Yoran predicts will be key to the development of the continent’s industry.
‘The African market is moving towards the European and American standards of 100% uptime and cheap high-speed internet for everyone,’ says Mumford. ‘There are big investments in local infrastructure data centres – bringing the internet closer to Africa – and the use of hybrid solutions that provide high-quality internet using both satellite and fibre.’
He adds that the growth of LTE in the next few years would not only increase the importance of satellite but also the need for satellite and fibre providers to work in tandem.
‘LTE providers must ensure that they have a high-capacity backhaul network in place in order to be able to deliver high-speed rich media to customers,’ says Yoran.
‘In Africa, this backhaul will be delivered by both fibre and satellite. Yes, a huge amount of fibre is being laid in Africa at the moment. However, we’re expanding our satellite networks as there will always be large gaps across Africa, which satellite can fill.’
Demand for faster service and the increasing need to serve non-urban areas means satellite is more in vogue than ever
Yoran says there had also been a change in thinking about whether or not people in rural areas could be a valuable source of revenue for providers, with doubts having previously existed.
‘People in rural areas who are not connected to cellular or internet networks can become a big source of revenue once they are connected,’ he says.
‘Service providers are broadening their markets to provide value-added services on top of the network.
‘In addition, the price of providing the connectivity is falling as well, so lower ARPUs [average revenue per user] are not quite such a problem as they were a few years ago.’
Prices are predicted to continue to fall as new satellites are launched in the coming months and new fibre routes are built.
Yoran expects more collaboration between competitive companies so that costs can be brought down further.
‘Lower prices per mbps [megabits per second] will also need to be achieved. We will see bandwidth being shared within the network as capacity management becomes more dominant in the network design.
‘We’ll also see more collaboration between competitive companies as the number of opportunities fall but the projects get larger,’ he says.
Some issues, however, do remain. Mumford says there are regulatory challenges when it comes to shipping and licensing, which are down to Africa’s political landscape.
‘The global VSAT forum and International Telecommunication Union recognise that these challenges exist, and that it’s very much about working with the governments and convincing them that facilitating connectivity is important for their communities,’ he says.
‘Like anywhere, Africa does have its challenges, and these are fairly typical of a continent where the infrastructure is really just beginning to emerge.’
According to Yoran, quality of service will continue to be an issue for satellite, although some providers have introduced fair access policies with guaranteed committed information rates. Customers are assured of predetermined amounts of bandwidth at all times – no matter how busy the network becomes.
That said, these issues do not outweigh the opportunity born of lack of connectivity in rural areas and the need for a backup option to fibre in metropolitan areas.
‘In the smaller cities, towns and rural areas, wireless broadband and satellite are still the only practical options,’ says Yoran.
‘Also cellular operators, ISPs and other vendors who have fibre connectivity cannot rely on that as the sole supplier of connectivity and need the satellite backup to build redundancy into the network.’
By Tom Jackson
Image: Gallo/GettyImages
