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The African Fiberco Big Three: A Strategic Analysis of Seacom, MainOne and Liquid Telecom & The case for Africa Fiber Consolidation

cover of The African Fiberco Big Three: A Strategic Analysis of Seacom, MainOne and Liquid Telecom & The case for Africa Fiber Consolidation

Market Study
Published: February 2016
Pages: 43
Research from: Xalam Analytics
Sector: Broadband & Fixed

From: GBP 849.00
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Executive Summary

1. The Africa Fiberco Big Three: An Overview
Africa Big Three Fiberco – Geographic Reach
The Africa Big Three Fiberco – Service Portfolio

2. The Africa Fiberco Big Three: Market Context & Business Challenge
The Top Line Traffic Projections that Underpinned Fiberco Models Have Largely Come to Fruition
Price Pressures Are Tightening the International Wholesale Capacity Sales Picture
But African Demand for Leased International Capacity is Structurally Unbalanced…
International Fiber Utilization Levels Are Relatively Suboptimal
Metro and Enterprise Markets are on the Upswing
African Fiber Market Value Has Resolutely Shifted from International to Domestic Fiber Capabilities
Fiber Infrastructure Provider Strategic Options

3. How Other Fibercos Did It: International Examples
Level 3: Transformed Into an Enterprise-Focused Global Infrastructure Bandwidth Provider
euNetworks: Focus on Best-In Class, End-to-End Infrastructure Bandwidth Provider

4. Reviewing Strategic Options for The Big Three Fibercos
The Best Performing Communications Infrastructure Players Generally Have Regional or Global Scale
What They Are Doing - Africa Fiberco Strategic & Tactical Steps

The MainOne Case: Overview
The MainOne Case: Nigerian Home Market Has Strong Consolidation Potential
The MainOne Strategic Case: (Mostly) Organic in the Metro+Enterprise, Buy the National Backhaul

The Seacom Case: Overview
South Africa's Communications Infrastructure Market: Thriving, with Room to Grow
The Seacom Strategic Case: In Crowded SA Market, Acquisitions Trump Organic Growth

The Liquid Telecom Strategic Case: Excellent Position - but Can Liquid Really do Everything?
5. The Case For (and Against) a Big Three Fiberco Consolidation
How the Big Three Map Out
What a Consolidated Portfolio Would Look Like

6. Assessing Africa's Big Three Fiberco as Acquisition Targets
The Case For an African Acquisition – Truly Global Network Scale
The Global Player Case Against an African Acquisition – In Truth, There Are No Great Fits
The Pan-African Case for a Fiberco Acquisition – Vodacom, Etisalat, PCCW and IS

Companies mentioned in the report:

Broadband Infraco
Dark Fiber Africa
Internet Solutions
Level 3 Communications
Liquid Telecom
Orange Business Services
PCCW Global
Phase III Telecom
Suburban Telecom
Tata Communications
Telkom SA

Sample charts:

Africa Big Three Fiberco Broad Network Country Reach*
Africa Big Three Fiberco Service Stack
The Number of Internet Connections has Risen 5x - 10x
The Proportion of 3G+ and FTTH Has Increased Substantially
Data Traffic is Exploding
Annual Growth of Leased International Capacity in Sample Markets
Monthly Lease Price for STM-1 Circuit - Cape Town to London
Monthly Lease Price for E-1 Circuit – Nairobi/Lagos to London
Share of International Capacity Requirements by Operator Type
Share of International Capacity Purchased from Third party
Design, Lit/Equipped and Used Capacity on Sample Cables*
Fiber Utilization Ratios for Sample cables
Evolution of Kenya Metro Requirements
Evolution of Enterprise Telecoms and ICT Services Revenues in Kenya
Annual Revenue Growth Performance for Key Fiber Market Segments*
Evolution of Level 3 Revenue Structure
Evolution of euNetworks Revenue Structure by Service Line

Africa Big Three Fiberco Broad Network Country Reach*

> Few companies outside of mobile network operators have done as much to transform the African Internet as Africa's Big Three Fibercos - Main One, Seacom, and Liquid Telecom.

> The three companies are the continent's largest independent cross-country fiber plays. Other fiber cables are owned at some level by mobile operators, utility companies or smaller ISPs.

> Together, they are largely responsible for upending African international capacity markets, driving sharp cuts in international wholesale prices by close to 80% over the past six years.

> This analysis examines where they go from here.

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