Report : APAC Submarine Cable System Market Forecast to 2028 - COVID-19 Impact and Regional Analysis By Service (Installation Services and Maintenance & Upgrade Services); by Application (Grid Interconnection, Offshore Wind Power, and Communication)
Growth in Offshore Wind Power Capacity from Asia Pacific is anticipated to drive the Market Growth during 2021–2028
According to a new market study, titled "APAC Submarine Cable System Market Forecast to 2028 – COVID-19 Impact and Analysis – by Service (Installation Services and Maintenance & Upgrade Services), Application (Grid Interconnection, Offshore Wind Power, and Communication)," the APAC submarine cable system market is expected to reach US$ 235.85 million in 2021 to US$ 546.78 million by 2028. It is estimated to grow at a CAGR of 12.8% from 2021 to 2028. The report provides trends prevailing in the APAC submarine cable system market along with drivers and restraints.
Submarine cable, fiber-optic cables laid in the ocean, carry more than 99% of intercontinental communication traffic, which makes them the invisible enablers of global connectivity. The future trends in adopting optical submarine cable systems are expected to enhance the network configuration flexibility and transmission capacity. Developments in technology for configuring the mesh network are expected to be a crucial factor in the enhancement of network configuration flexibility. The submarine cable installations are increasingly shifting toward cable projects led by over-the-top (OTT) hyperscalers from consortiums cables. Content providers such as Google, Facebook, Microsoft, and Amazon are investing vast amounts in data centers and cable projects across the world, including Asia Pacific countries. The rise in demand from content providers for data centers is holding potential growth opportunity for the APAC submarine cable system market.
Asia Pacific consists of many developing countries that are becoming digital economies. The booming digital economies in the region fuel the need for cloud and 5G services, which propels the demand for data bandwidth. The underwater cable network is the most critical aspect of the telecommunication infrastructure. Technology trends, such as artificial intelligence, faster connectivity with 5G, and machine learning, would impact the submarine cable infrastructure. As per the Cisco report, the number of internet users in Asia Pacific is expected to increase to 3.1 billion by 2023, from 2.1 billion users in 2018. In June 2020, NEC Corporation was appointed by the Asia Direct Cable (ADC) Consortium to build a 9,400 km submarine cable that will connect Hong Kong, China's Guangdong province, Japan, the Philippines, Singapore, Thailand, and Vietnam. The project is scheduled to be completed by the fourth quarter of 2022. Business prospects for submarine cable systems are evolving with the increasing demand for social networking sites and cloud storage. The growing number of social media platform users, coupled with the rising need for higher bandwidths, is fueling the demand for submarine cable systems. Above-mentioned factors are propelling the demand for APAC submarine cable system market.
Further, the huge potential of offshore wind energy in Asia Pacific countries is dominating the demand for submarine cables for cross-border trading of electricity. As per the Global Wind Energy Council, China is expected to continue its dominance among the Asian offshore wind markets in the first half of this decade, with more than 70% market share. In addition, the number of utility-scale offshore wind projects being connected is increasing in emerging countries, such as Taiwan, Japan, South Korea, and Vietnam. Thus, booming growth in production of offshore wind energy from Asia Pacific countries is also propelling the submarine cable system market size in coming years.
Indonesia is holding the largest market share of the APAC submarine cable system market, followed by Malaysia and India. In India, the telecom companies in India pushes to introduce 5G networks in the country for commercial usage by 2022 owing to rise in demand from social media users. Growing upcoming projects for constructing the submarine cables is further fueling the demand for installation which helps drive the APAC submarine cable system market growth. For instance, in May 2021, Reliance Jio Infocomm Ltd. is constructing the largest international submarine cable system India-Asia-Xpress (IAX) system which will have express connectivity from Mumbai and Chennai to Thailand, Malaysia, and Singapore. Thus, growing invest trend for deploying higher bandwidth enables the demand for submarine cables which is driving the APAC submarine cable system market growth.
The growth in offshore growth in offshore wind power capacity from Asia Pacific region along with increase in grid connectivity are the prominent factors driving the APAC submarine cable system market growth over the forecast period.
The global COVID-19 crisis drastically affected APAC countries, namely China, India, and Japan, especially in 2020. The consequent enactment of lockdown measures and the slowdown of manufacturing industries in these countries have led to a slowdown in the production of submarine cables. The shuttering of manufacturing factories did not have any immediate impact on global connectivity, but it pushed back the deployment of new systems. However, in 2021 and later, the APAC submarine cable system market is expected to start recovering from the impact of COVID-19 with the resumption of projects for renewable energy grids and communication networks. The APAC submarine cable system market analysis is primarily focused on new upcoming developments, investments and macro and micro factors in post pandemic scenario that influences the APAC submarine cable system market growth.
in February 2022, Airtel joined SEA-ME-WE-6 undersea cable consortium to scale up its high-speed global network capacity to serve the fast-growing digital economy of India. Thus, such growing initiatives in post pandemic scenario for enhancing the internet bandwidth is fueling the APAC submarine cable system market growth over the forecast period.
NEC Corporation, S. B. Submarine Systems Co., Ltd., SubCom, LLC, NTT WORLD ENGINEERING MARINE CORPORATION, and Alcatel Submarine Networks are key the APAC submarine cable system market players profiled in the research study. These players adopt organic growth strategies, such as product launches and expansions, to sustain their position in the APAC submarine cable system market.
The report segments the APAC Submarine Cable System Market – by Service and Application
- Installation Services
- Maintenance & Upgrade Services
- Grid Interconnection
- Offshore Wind Power
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