In 2020, the global fibre optic cable market was valued at $8,3-billion. By 2027, it is expected to reach a staggering $21,5-billion. This exponential growth is a sign that fibre internet is here to stay. With an expected compound growth rate of 14.5% from 2021 to 2027, investors all over the world are adding fibre optics to their investment portfolios. But why is the fibre optics market growing so rapidly and why is it now set for exponential success?
In the early years, fibre optic cables were used to create network connections between buildings. They were first used in Colorado in the 1970s to connect computers in the NORAD headquarters. In 1996, the first subsea fibre optic cable was laid in the Pacific Ocean and since then, many more cables have been buried under water, connecting continents and countries the world over.
The next major phrase in fibre optics came with the boom in terrestrial fibre lines, connecting inland cities to cable stations on the coast. With this development, major business hubs were able to connect to high speed internet – a massive boost to digital transformation. In more recent years, smaller towns and cities, including suburban and rural areas, have been included on the fibre grid.
In South Africa, the expansion of fibre optic networks have connected more and more households. There has been a surge in demand for high speed connections because of the trend towards remote work. Growing demand drives down prices and this, in turn, generates even greater demand. Fibre is not only becoming more affordable and widely available, it also provides the best internet experience.
Fibre optic technology
Glass fibres are used to transmit data across long distances using light signals. Silica glass fibres can transmit light waves without any significant loss in signal strength, meaning that fibre optics offer the best speeds compared to other types of internet connections. Fibre optic cables are a replacement for metal wires, with the raw material largely composed of silicon dioxide (SiO2).
These cables are very thin compared to other types of cable, and yet they offer more stability and much higher internet speeds. Copper wires are notoriously unstable, highly affected by poor weather conditions and electromagnetic interference.
The fibre optic market is currently dominated by companies based in China and Japan, and the top global fibre optic cable company is Corning – an American tech company specialising in glass, ceramics and advanced fibre optics. With a 20.56% return on net assets, Corning holds 16.3% of the market share
Similarly, 43% of the market is shared among five Chinese enterprises and 23% market share is held by three Japanese companies. Interestingly, an Italian company also ranks in the top ten, with 7.9% of the fibre optic global market and a 21.97% return on net assets.
Fibre optic connectivity in SA
The demand for fibre optic connectivity in South Africa has skyrocketed in recent years, especially in light of lockdowns and the set up of home offices. The demand for high-speed connectivity has spread to smaller towns, with so-called Zoom Towns popping up along South Africa’s picturesque coastlines and quaint villages. Attracted by the prospect of quieter living and lower costs, South Africa has witnessed a growing trend of professionals leaving the major metropoli in search of a more laid-back lifestyle in the countryside.
But without fibre, remote work generally results in frustration and unproductivity. Throw in a few additional load shedding stages and remote workers may find themselves completely powerless against a growing to-do list. With the aid of a UPS – a sort of back-up battery – fibre internet doesn’t have to switch off when the lights go out. Unlike mobile internet which is severely affected by loadshedding, fibre internet offers a much more reliable connectivity solution, no matter what is happening behind the scenes with power suppliers.
The South African fibre optic market is booming – like most other countries around the world. It is a highly competitive sector in which internet service providers (ISPs) and fibre network operators (FNOs) lobby for finite customers.
In Europe, the internet has long been considered a necessity rather than a luxury. “Digital exclusion is a form of social and political exclusion that no society should tolerate,” suggests Dr Merten Reglitz from the University of Birmingham, in his commentary about the effect of lockdowns and socio-economic engagement.
Even back in 2010, a BBC survey of 26 countries revealed that almost 90% of people believe internet access to be a basic human right, and in 2011 the United Nations declared just that. While South Africa still has some catching up to do, local digital expansion has been exponential thanks to the rapid roll-out of fibre optics throughout the nation. For more information about our fibre offerings or to get a quote for an internet upgrade, please contact us today or check if we’re connected to your address.