New knowledge from TeleGeography’s Transport Networks Analysis Service tells a narrative about altering bandwidth pricing developments, the elements that drive them, and what we’d count on to see available in the market.
This is what we learn 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 affect in the marketplace, notably when it comes to 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 sluggish.
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.
Because of this, funding in new submarine cables has surged. In some cases, delays in cable completion, for causes starting from geopolitics to provide chain disruptions, have slowed worth erosion to single digits.
In others, new provide has created intense worth competitors.
As all the time appears to be the case, new tasks that reap the benefits of the most recent know-how affect worth. Wavelength costs total 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 mean of 11% compounded yearly.
How these massive new investments are impacting every area varies. The determine under maps out the 100 Gbps wavelength worth at the hours of darkness blue columns and the CAGR worth decline within the crimson circles.
Weighted Median 100 Gbps Wavelength Costs & CAGR Worth Decline on World Routes
Supply: © 2025 TeleGeography
Understanding Worth Erosion in 2025
Worth erosion has returned to kind 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 present 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 an enormous inflow of recent 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 value 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. Because of this, worth erosion remains to be sluggish.
Routes connecting to (and inside) Asia are a major instance. Between 2021 and 2024, 100 Gbps costs on Singapore-Tokyo and Marseille-Singapore decreased 6% and a pair of% yearly from 2021 to 2024, respectively.
That is starting to alter, although. With delayed methods beginning to enter service on the finish of 2024, these routes will obtain a considerable quantity of recent provide and rivals over the subsequent few years, seemingly setting the stage for rising worth erosion.