The market has seen a significant increase in the recent past and is predicted to grow significantly during the forecasted period as well.
Submarine communication cables play an important role in facilitating international connectivity between nations & regions. These cables are virtually responsible for the entirety of global internet traffic, & with the constant growth in internet usage, a corresponding increase in cable demand can be seen.
Moreover, the global market's growth is further driven by the growing importance of the integration of offshore renewable energy resources & improved energy resilience. These communication cables allow quick information exchange & the seamless transmission of large data volumes across the globe.
According to ITIF, submarine cables are the backbone of global connectivity, carrying approximately 99% of international communications traffic. With 378 cables spanning 1.2 million kilometers as of early 2019, they connect nearly every coastal nation.
Over the last five years, the industry has witnessed an average 26% annual growth in capacity on major routes, driven by surging demand for data transmission. Despite being shielded or buried, submarine cables experience over 100 faults annually, often caused by fishing activities, anchors, or natural disasters.
Consortia, accounting for 90% of funding in the last three decades, have invested $43 billion into the sector. Huawei Marine, laying 5,000 kilometers of cable in recent years, remains a smaller player compared to TE SubCom’s dominant 80,000 kilometers. These trends underscore the strategic importance and ongoing evolution of the submarine cables market.
The submarine cable industry is abuzz with activity in 2024. Upcoming events include the Submarine Cables 2024 Exhibition & Conference, focusing on innovations in undersea communications and
power transmission. Key topics include advanced cable technologies, installation techniques, and asset protection strategies. The event aims to address global connectivity challenges while promoting sustainability.
Recent industry deals include partnerships like Mobily's collaboration with Telecom Egypt, connecting Saudi Arabia and Egypt via the Red Sea, and Sparkle's collaboration with Liberty Networks for a new pan-regional cable system. Meanwhile, new systems such as the 2Africa Pearl cable have launched, enhancing global connectivity
Market Dynamic
The increasing demand for high-voltage direct current (HVDC) cables in offshore oil platforms & the growth of renewable energy generation is anticipated to create favorable opportunities for the submarine power cables market in the coming years. HVDC cables find their importance in efficiently transmitting power across extended distances & facilitating seamless system interconnections, which involves the conversion of alternating current (AC) to direct current (DC) via cables for transmission, followed by the reconversion to AC at the receiving end.
However, a major challenge for the global submarine cables market is the potential impact of natural disasters & external disruptions. Events like earthquakes, underwater landslides, & ship anchor damage, can lead to cable breaks or damage, disrupting communication & data transmission. Reducing these risks requires strong cable design, strategic routing, & effective monitoring systems to reduce downtime & ensure consistent connectivity.
Research Scope and Analysis
By Application
The largest portion of total revenue in the global submarine cable market is attributed to the submarine power cable segment. This dominance is mainly driven by the growing demand for cross-border & island connections, along with the growth of capacity within the offshore wind industry. Further, the growth in offshore wind farms & the shift towards electrification in offshore
oil & gas networks have encouraged for increase in research and development, along with expanding the demand for submarine power cables. This segment's significance is further driven by its major role in sustaining seamless energy transmission across underwater distances.
Moreover, the submarine communication cable segment also has a substantial share & is expected to experience rapid growth throughout the forecasted period. The growth of urbanization & economic pursuits has set the stage for growing development in infrastructure & construction, spanning both emerging & established economies. These growing activities across the commercial,
telecom, energy, & power sectors are a driving factor behind the expansion enhancement of infrastructure, consequently fueling the demand within the submarine cable market.
By Voltage
The dominant share of revenue is claimed by the high voltage segment. Mainly the high voltage cables exceeding 33kV play a major role in the effective transmission & distribution of power. The growing demand for high-voltage direct current (HVDC) submarine power cables, integrated with major investments in offshore wind power generation, serves as the major driver fueling the expansion of this high-voltage cable segment.
A significant advantage of HV cables depends in their capacity to reduce transmission losses, thereby promoting efficient power conveyance. The fast-evolving landscape of HVDC power systems further allows the seamless transfer of electricity from potent high-capacity sources to main grids. This momentum is boosted by the support of key industry players & research bodies like DESERTEC, North Seas Countries Offshore Grid Initiative, & CIGRE, enhancing the growth of HVDC power systems.
Moreover, in the forecasted period, a strong growth trend in the medium voltage cable segment is anticipated. This growth is driven by the growing use of medium voltage (MV) cables for transmitting power in offshore oil & gas infrastructure. The rising requirements from international oil & gas activities are a major factor driving the expansion of the MV submarine cable industry.
By Offering
In 2023, a key driver for the global submarine cables market is the installation and commissioning segment. This is driven by the major expenses, specialized equipment, & complex technological procedures involved. This requires specialized tools like cable vessels, testing equipment, operational software, & underwater installation machinery. For underwater optical cables, installation equipment includes beach underwater robotic vehicles, burial tools, burial machines, & automated control systems. The segment is expected to offer strong growth opportunities in the foreseeable future.
Moreover, the upgrade segment is also anticipated to have substantial growth during the forecasted period, as the existing cables have significant value, often efficient in exceeding their initial design parameters in terms of both capacity & structure due to advancements in technology. Improvement to Submarine Line Terminal Equipment (SLTE) at cable landing stations typically requires under eight months for acquisition & implementation, in comparison to an average of 3 years for constructing an entirely new long-haul cable system (size-dependent).
By End User
The offshore wind power generation segment holds a major portion of the overall market's revenue share. This dominance can be said due to growing investments in offshore wind power projects and the usage of submarine power cables for transmitting electricity over large distances from these facilities.
This strategic utilization remains a major driver behind the fast growth of the submarine cable industry. As wind turbine technology advances, inter-array cables are adaptable to accommodate elevated electrical capacities. This technological enhancement allows efficient electricity transmission from larger & more potent wind turbines, optimizing energy yield from offshore wind farms.
Further, encouraging regulatory frameworks & attractive financial incentives are increasing investments in offshore wind ventures, thereby increasing demand for inter-array cables. Additionally, a major trend includes the integration of higher voltage levels in export cables, focusing to curtail electrical losses over large distances & improve transmission efficiency. These high voltage levels enable the conveyance of greater power quantities with reduced losses, ultimately improving the operational efficiency of offshore wind initiatives
The Global Submarine Cables Market Report is segmented on the basis of the following:
By Application
- Communication Cables
- Power Cables
By Voltage
- Medium Voltage
- High Voltage
- Extra High Voltage
By Offering
- Maintenance
- Installation & Commissioning
- Upgrade
By End User
- Offshore Wind Power Generation
- Offshore Oil & Gas
- Inter-Country & Island Connection
Regional Analysis
The Asia Pacific region has secured a significant market share, contributing about
36.9% of the total revenue in the Global Submarine Cables Market in 2023. In the Asia-Pacific region, mainly the submarine cable market growth is anticipated in China, Japan, & India. This growth is anticipated by significant investments from key industry players, driven by the growing adoption of the Internet of Things (IoT) & improved connectivity for businesses of all sizes, both in rural & urban areas within the region. Particularly for Japan & ASEAN countries, which include a cluster of islands, there is a prominent emphasis on power transmission installations between these islands.
Moreover, Japan, as an island nation, presents large workable locations for offshore wind power generation. The nation has determined that offshore wind turbines can create up to five-fold more electricity in comparison to their onshore counterparts. Furthermore, considering potential land limitations for onshore wind farm development in the future aligns with the strategic push toward offshore solutions.
By Region
North America
Europe
- Germany
- The U.K.
- France
- Italy
- Russia
- Spain
- Benelux
- Nordic
- Rest of Europe
Asia-Pacific
- China
- Japan
- South Korea
- India
- ANZ
- ASEAN
- Rest of Asia-Pacific
Latin America
- Brazil
- Mexico
- Argentina
- Colombia
- Rest of Latin America
Middle East & Africa
- Saudi Arabia
- UAE
- South Africa
- Israel
- Egypt
- Rest of MEA
Competitive Landscape
Various providers of submarine cables also take part in diverse ventures like offshore oil & gas initiatives & undersea electrical cable projects, providing marine infrastructure development on a global scale. Mainly, key industry participants are constantly looking for strategic acquisitions & partnerships with local stakeholders, focusing on extending their market presence into untapped territories & enhancing their distribution networks.
For instance, in April 2023, Nexans successfully acquired Reka Cables, a popular cable manufacturer located in Finland. This acquisition is strategically focused on providing secure & high-quality cable offerings to customers in the Nordic region & beyond, capitalizing on the synergies of the two entities.
Some of the prominent players in the Global Submarine Cables Market are:
- Nexans
- NEC Corp
- Google LLC
- Prysmian Group
- Microsoft Corp
- ZTT
- NKT A/S
- Sumitomo Electric Industries Ltd
- LS Cable & System Ltd
- SubCom LLC
- Other Key Players
COVID-19 Pandemic & Recession: Impact on the Global Submarine Cables Market:
The COVID-19 pandemic along with the subsequent economic recession has a major impact on the global submarine cables market. While the starting phases of the pandemic disturbed supply chains & delayed some projects, the growing reliance on digital connectivity for remote work, online education, & entertainment increased the need for robust & high-capacity communication networks.
This increased demand for data transmission & the ongoing expansion of 5G networks have increased the funding for new submarine cable installations & upgrades, focused on addressing the growth in internet traffic. Market players, adapting to remote work conditions themselves, have shown resilience in maintaining operations & fostering innovation. As economies recover, the submarine cables market is anticipated growth, driven by the importance of seamless digital communication in a growing interconnected world.
Recent Developments
- 2023, NEC Corporation (TSE: 6701) announced on October 2, the successful completion of the Patara-2 submarine cable system. This network, connecting multiple islands across Indonesia, is owned by Telkom Indonesia, the nation’s largest digital telecom provider, committed to driving Indonesia’s digital transformation.
- 2023, On April 26, Nexans completed its acquisition of Reka Cables, a Finnish company specializing in high, medium, and low voltage cables. This milestone followed regulatory approval and involved Reka Industrial, listed on NASDAQ Helsinki Ltd., as the selling party.
- 2024, On November 13, STC Group subsidiaries STC Bahrain and Center3 announced the development of a data center park in Bahrain. The event also marked the launch of the 2Africa Pearl subsea cable system, enhancing Bahrain’s role as a key digital connectivity hub.