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Agenda. A view of Africa. … GDP growth in Africa is outpacing Asia. Nairobi, Kenya. Lagos, Nigeria. Johannesburg, SA. There are more middle income households in Africa than there are in India. (*KPMG ). The true size of Africa *Kai Krause. Cairo, Egypt.

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a view of africa
A view of Africa

…GDP growth in

Africa isoutpacing

Asia

Nairobi, Kenya

Lagos, Nigeria

Johannesburg, SA

There are more

middle income

households in

Africa than there

are in India. (*KPMG)

The true size of Africa

*Kai Krause

Cairo, Egypt

myriad business opportunities
Myriad business opportunities
  • Estimated size of ICT enterprise services market
  • in 2013 – c. $9b
  • KEY DRIVERS FOR GROWTH:
  • Demand for connectivity and data
  • Continued growth in mobile sector
  • Mobile money
  • Content (media, broadcasting)
  • Mobile advertising set to grow
south africa as a launch pad
South Africa as a launch pad

Africa’s international bandwidth

jumps to 1,479 Tbps in

Dec 2012

terrestrial fibre
Terrestrial Fibre

Increased investments by Governments and Private sector

July 2012, Africa’s total inventory of terrestrial transmission networks reached 732,662km

Fibre now reaches 40% of the African population

313m people were within reach of a fibre node

Expected to reach 50% of population with completion of planned projects

telco environment
Telco Environment
  • Key to success has been liberalisation on Telco market
  • SA Telco deregulated in 2008
  • Dark Fibre introduced by DFA in 2009
  • Several new Telco’s launched 2009 – 2012
  • Teraco first neutral facility in Africa established 2009
  • ISP’s begun to build own fibre networks
  • Submarine cables (SAT3/SAFE 2005, SEACOM 2009, EASSY 2010)
  • International bandwidth pricing drop (2008 – 2013)
  • Global Telco’s entering SA (BT, Level3, China Telecoms, Level 3 etc.)
  • NAPAfrica reaches over 100 members +8Gbps traffic
african ixp challenge
African IXP Challenge

Limited amount of active IXP’s in Africa both – only 26 IXP’s of which 18 IXP’s are active (AU – AXIS Project)

Cost of Bandwidth at $50.00 per 1Mbps reduces opportunity for global new entrants – IXP donations very expensive e.g. Akamai

Cross border capacity still limited and expensive therefore regional exchange points hard to motivate

Majority of “eye balls” do not have technical skills or assets therefore still heavily reliant on transit

Majority of countries still operate within a monopoly managed by governments

Limited marketplace to obtain members – new members generally need to be convinced to let go of existing transit arrangements

Existing ASN application process very slow and expensive for new entrants

Larger networks hanging onto legacy transit revenues therefore generally do not join the exchange and if join polices are very selective

Interconnection costs very high in non neutral data centres

Interconnection costs between facilities very high ave. of $18000.00 1Gbps fibre non redundant

Lack of collaboration between African IXP’s – all exchange points compete for content and members

napafrica case study
NAPAfrica Case Study

Hosted in Teraco, neutral facilities – free interconnection to the exchange for all colo clients

Funded by Teraco

National footprint: Cape Town, Durban and Johannesburg

Officially launched in early 2012

Currently peaking at over 5Gbps with more than 100 members

Challenges:

  • Regulatory environment
  • Competition
  • Hardware costs
  • Skills shortage
  • Limited investment by international content providers
global content shortage
Global Content Shortage
  • Instant marketplace opportunity:
  • Content Providers investment in Africa is limited;
  • Content Providers only able to deploy in major hubs and not multiple countries;
  • African IXP’s collaboration is limited – AF-IX key;
  • Content and “eye-ball” operators to collaborate;
  • Open distribution of content across borders is key
slide13

African Transit Landscape

$120.00 - FIBRE CROSS

CONNECT

$120.00 - FIBRE CROSS

CONNECT

$70.00 PER

1MPBS

$70.00 PER

1MPBS

13

13

13

slide14

African IXP Effect: Neutral Facilities Needed

$0.00 PER

CONNECTION

$0.00 PER

CONNECTION

$00.00 PER

CONNECTION

$20.00 PER

Fibre cross connect

$20.00 PER

Fibre cross connect

14

14

slide16

African Requirements

  • For an IXP to be successful and sustainable it needs to be stable, reliable, and accessible by any network that fulfils the technical participation requirements. This means:
  • Standard, open and unrestricted interconnection policies - Everybody plays by the same rules.
  • Always-on, reliable, open hosting facility and infrastructure - Nobody wants content that is not always available.
  • Reliable, high quality structured cabling systems and procedures - Physical interconnection in the same facility should take hours, not weeks.
  • Multiple peers and unrestricted market-place – Carriers, ISPs, CDNs, Banks, Enterprises – An exchange cannot grow without peering members.
  • Scalable space and infrastructure for content growth. Moving a successful exchange is a complex, and costly exercise. Always plan for growth.
  • Effectively, the definition of a vendor neutral datacentreclearly illustrates that neutral facilities are a perfect fit for IXP deployment.

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slide18

Thank you

michele@teraco.co.za