New knowledge from TeleGeography’s Transport Networks Analysis Service tells a narrative about altering bandwidth pricing traits, the elements that drive them, and what we’d count on to see out there.
This is what we find out about wholesale pricing in 2025.
Provide chain constraints and geopolitical challenges dramatically slowed world worth erosion over the previous few years. However with provide points within the rearview mirror, delayed methods are lastly coming to fruition. And their impression available on the market, notably by way of worth, is beginning to be felt.
On a number of key world routes, worth erosion is accelerating as new high-capacity cables enter service. On different routes, the place delayed methods are simply beginning to come into service and geopolitical challenges persist, worth erosion remains to be gradual.
Nevertheless, this isn’t anticipated to final for much longer.
Cable Funding Impacts on Bandwidth Pricing
Capability demand has been doubling practically each three years on many routes.
In consequence, funding in new submarine cables has surged. In some situations, delays in cable completion, for causes starting from geopolitics to produce chain disruptions, have slowed worth erosion to single digits.
In others, new provide has created intense worth competitors.
As at all times appears to be the case, new tasks that benefit from the most recent expertise impression worth. Wavelength costs general in 2024 continued their regular decline. Between This fall 2021 and This fall 2024, weighted median 100 Gbps wavelength costs throughout the important thing world routes under decreased a median of 11% compounded yearly.
How these huge new investments are impacting every area varies. The determine under maps out the 100 Gbps wavelength worth in the dead of night blue columns and the CAGR worth decline within the crimson circles.
Weighted Median 100 Gbps Wavelength Costs & CAGR Value Decline on International Routes
Notes: Whole building prices of all worldwide and home submarine cables getting into service in designated years. Building prices exclude the price of subsequent capability upgrades and annual operational prices. 2025-2027 building prices primarily based on introduced contract values and TeleGeography estimates. Not all deliberate cables could also be constructed.
Supply: © 2025 TeleGeography
Understanding Value Erosion in 2025
Value erosion has returned to type on routes with extra ample provide as new high-capacity cables enter service.
For instance, the U.S.-Latin America route continues to fall briskly, reflecting the approaching launch of Firmina, various fiber pair possession, and upgrades to current methods.
Between 2021 and 2024, 100 Gbps wavelength costs on Miami-São Paulo decreased 25% compounded yearly, to $12,000 month-to-month. Equally, Johannesburg-London, which noticed a large inflow of latest capability from the launch of Equiano, recorded an annual 15% worth drop for 100 Gbps wavelengths over the previous three years. In This fall 2024, weighted median 100 Gbps wavelength costs on the core Africa-Europe route had been $32,272 month-to-month.
That’s 5.9 occasions the worth of London-New York, in comparison with 7.5 occasions dearer simply three years in the past.
On different routes, deliberate cables are simply beginning to come to fruition, and geopolitical hurdles stay. In consequence, worth erosion remains to be sluggish.
Routes connecting to (and inside) Asia are a chief instance. Between 2021 and 2024, 100 Gbps costs on Singapore-Tokyo and Marseille-Singapore decreased 6% and a couple of% yearly from 2021 to 2024, respectively.
That is starting to vary, although. With delayed methods beginning to enter service on the finish of 2024, these routes will obtain a considerable quantity of latest provide and rivals over the following few years, seemingly setting the stage for rising worth erosion.
