We’ve witnessed an unprecedented slowing of bandwidth value erosion globally over the previous few years, as community buyers, carriers, and prospects grappled with delays in new community tasks, present system upgrades, and rising gear prices.
For the primary time, many purchasers discovered themselves asking if costs had been really rising and when value declines would return to typical ranges.
Whereas the provision chain constraints and card shortages that spurred this development have resolved themselves, geopolitical points haven’t. Consequently, latest value tendencies range dramatically by area.
Based on new knowledge from TeleGeography’s Transport Networks Analysis Service, value erosion has began to speed up on some routes, however stays stalled on others.
The determine beneath highlights the compound annual value decline for 100 Gbps wavelengths from 2020 to 2023 (the darkish blue bars) versus the prior three years, 2017-2020 (turquoise bars).
Weighted Median Month-to-month 100 Gbps Wavelength Value Erosion
Notes: Every bar represents the share decline of the weighted median value, calculated as a three-year compound annual progress price for the listed route and time interval. Supply: © 2024 TeleGeography
Throughout all of the routes featured above, 100 Gbps wavelength costs decreased a mean of 13% between 2020 and 2023. That’s in comparison with 18% over the prior three years (2017-2020).
On routes with extra ample provide, value erosion has returned to kind as new excessive capability cables enter service.
On routes with extra ample provide, value erosion has returned to kind as new excessive capability cables enter service.
For instance, the U.S.-Latin America route continues to fall at a brisk tempo, nonetheless feeling the consequences of latest cables, numerous fiber pair possession, and upgrades to present methods. The route can be anticipating the launch of the Firmina cable later this yr.
Between 2020 and 2023, 100 Gbps wavelength costs on Miami-São Paulo decreased 28% compounded yearly. That has exceeded the 22% lower between 2017 and 2020.
Whereas not featured right here, Johannesburg-London, which noticed an enormous inflow of latest capability from the launch of Equiano final yr, recorded an annual 22% value drop for 100 Gbps wavelengths over the previous three years.
On routes with continued delays in new provide, value erosion remains to be stalled.
On routes with continued delays in new provide, value erosion remains to be stalled.
For instance, 100 Gbps costs on Marseille-Singapore and Hong Kong-Singapore decreased simply 2% and 6% yearly from 2020-2023. That’s in comparison with 28% and 16% yearly from 2017-2020.
The Europe-Asia and intra-Asia routes have been particularly impacted by latest delays in provide. Whereas card shortages have resolved themselves, geopolitical points play a key position in delays of latest methods on each routes.
Till new methods begin coming into service this yr, accessible stock goes for 2023 costs or doubtlessly larger.
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