Home Advanced Materials Submarine Cables Market Size Worth US $44.96 billion by 2031

Submarine Cables Market

Submarine Cables Market Size, Share & Trends Analysis Report By Application (Submarine power cables, Submarine communication cables), By Voltage (Medium Voltage, High Voltage, Extra-High Voltage), By End-User (Offshore Wind Generation, Inter-Country and Island Connection, Offshore Oil and Gas), By Component (Dry plant products, Wet plant products), By Offerings (Installation and Commissioning, Upgrade, Maintenance) and By Region(North America, Europe, APAC, Middle East and Africa, LATAM) Forecasts, 2023-2031

Report Code: SRAM55724DR
Study Period 2019-2031 CAGR 6.15%
Historical Period 2019-2021 Forecast Period 2023-2031
Base Year 2022 Base Year Market Size USD 26.39 Billion
Forecast Year 2031 Forecast Year Market Size USD 44.96 Billion
Largest Market Asia Pacific Fastest Growing Market Middle East And Africa
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Market Overview

The global submarine cables market size was valued at USD 26.39 billion in 2022. It is estimated to reach USD 44.96 billion by 2031, growing at a CAGR of 6.1% during the forecast period (2023–2031). Offshore installations, remote area connections, and cross-border links will continue to fuel the demand for underground submarine cables. Over the course of the 2021–2028 forecast period, the growing number of telecom subscriptions and large investments in offshore wind farms will have a direct impact on the submarine cable industry. Google and Facebook are still investing in and building new underwater cables; one such project is the Pacific Light Cable Network. The market for submarine optical fiber cable is expanding as a result of rising investments in high-speed internet infrastructure.

Submarine cables are installed on the sea floor between land-based stations to transport telecommunication and data signals over the ocean and sea ranges. Undersea cables were historically used for telegraphy and, subsequently, telephone traffic, but current undersea cables employ optical fiber technology to convey digital data such as telephone, Internet, and private data traffic. These cables are widely employed in the worldwide submarine cable market for purposes such as power and communication.

Market Dynamics

Submarine Cables Market Drivers

Increasing Investment by OTT Providers

OTT providers are becoming integral to the submarine cable system's significant development process. Prominent players such as Microsoft Corporation, Google Inc., Facebook Inc., and Amazon Inc. are moving from capacity purchasers to submarine cable owners. Companies will invest in developing submarine cables to push innovations in the submarine cable segment, given the growing prominence of submarine cable usage in various industries. Further, the submarine cable operators are collaborating with data center providers.

Meanwhile, collaboration between IIPs, OTTs, data center providers, backhaul network providers, and Tier 1 telco carriers is expected to transform the subsea connectivity landscape faster over the forecast period.

Increasing Demand for Inter-Country and Island Power Connections

Rapid urbanization and economic activity drive expansion in infrastructure and building industries in emerging and established countries. Demand from diverse sectors such as commercial, telecom, energy, and power drives infrastructure growth and upgrade, which is expected to generate demand for submarine cables.

Furthermore, the growing emphasis on joining offshore renewable energy generation to meet future renewable energy targets and increase energy security, providing energy access to remote landmasses, and interconnecting national grids to reduce energy consumption has fueled the global expansion of the submarine cable market. Offshore installations, remote area connections, and cross-border links will continue to fuel the demand for underground submarine cables.

Submarine Cables Market Restraint

Complex Repairing and Maintenance Procedure for Subsea Cables

According to the U.N. General Assembly resolution, submarine cables have a critical communication infrastructure. Policies and regulations associated with submarine cables create great complexity for the manufacturers. Furthermore, the international subsea cable industry is a major segment of the worldwide telecommunications system, requiring increased protection and providing important services for maintaining global maritime and economic security. With the security compliance and legal aspects, there is a great cost associated with maintenance and repair services.

Additionally, submarine cables sometimes cause spatial conflicts with other ocean users, especially the fishing industry. These issues include legal accountability for cable damage, regulation and licensing of cables on the continental shelf and the seabed of the high seas, and compensation for lost or damaged gear. Such legal complexities with the maintenance of submarine cables create a great challenge for the manufacturers.

Submarine Cables Market Opportunities

Increasing Number of Offshore Wind Farms

Economies of scale are driving up the size of offshore wind farms. Larger farms will demand and allow more sophisticated electrical transmission systems as wind power impacts the onshore electrical grid more. As power electronics have been developed, the demand for submarine cables is expected to play an important role in distribution designs and offshore windfarm transmission, including introducing high-voltage direct current (HVDC) transmission. The rising number of offshore renewable energy projects worldwide due to rising penetration across other submarine applications and rising carbon dioxide levels is projected to boost submarine power cable manufacturers substantially.

Furthermore, the growing number of offshore wind farms and the expanding electrification of offshore oil and gas networks have increased R&D activity, raising the need for submarine power cables. With the introduction of subsea cables, mainland power grids and oil platforms have become easy to connect. Additionally, submarine cables assure surveillance and monitoring to strengthen business development and manage activities in the ocean. Meanwhile, the increasing energy sector globally is expected to positively influence the compound annual growth of the submarine cable market over the forecast period.

Regional Analysis

Asia-Pacific Dominates the Global Market

Based on region, the global submarine cable market is bifurcated into North America, Europe, Asia-Pacific, South America, and the Middle East and Africa.

Asia-Pacific is the most significant global submarine cable market shareholder and is estimated to exhibit a CAGR of 6.3% over the forecast period. The area has the region's largest adoption and implementation of wind farms, with China leading the way. China had 4.6 GW1 of active offshore wind generating capacity in 2018, according to IEEFA. It added 1.8 GW of offshore wind capacity in 2018, accounting for 40% of the total 4.5 GW added globally that year. In January 2019, China authorized 24 offshore wind-generating projects off the coast of Jiangsu Province, totaling 6.7 GW and totaling USD 18 billion in investment. These projects are estimated to be completed by 2020. China's top utilities support these offshore wind projects, including China Energy Group, China General Nuclear Power Corp., China Huaneng Group, and the State Power Investment Corp.

Furthermore, in April 2020, Facebook purchased USD 5.7 billion in Reliance Jio (India). As a result, the region's need for underwater cables is increasing. The Asia Pacific region is quickly emerging as a hub for direct investment in submarine cable infrastructure. Google, Microsoft, and Facebook are the primary players in this. Google, for example, has already invested in Asia's existing undersea cable space. In addition, in 2021, Google will invest in a new underwater cable system connecting Japan to Australia through Guam.

South America is anticipated to exhibit a CAGR of 5.1% over the forecast period. This is owing to the increasing investments in wind farms and inter-country and island connections in the region. Also, several submarine cable projects started operations in 2021; for instance, in June 2021, Google announced plans to create Firmina, an open subsea cable connecting the US East Coast to Las Toninas, Argentina, with landings in Brazil and Uruguay. With the new connection, the company expects to improve internet connectivity for Latin American subscribers while bolstering its regional cable investments.

In North America, the worldwide submarine cable industry is expanding rapidly. The growing need for high-speed internet and data connections is driving the industry. Expanding the cloud computing and 5G sectors also contributes to market development. A few significant firms dominate the North American submarine cable market, including TE Connectivity, Prysmian Group, and Nexans. These firms have a significant market presence and invest considerably in research and development. They are also developing their undersea cable network to satisfy the increasing demand for data access.

The Middle East and Africa are the world's fastest-expanding regions regarding internet and data connections. The market's expansion is ascribed to rising demand for high-speed internet and data connection, increased investment in offshore wind farms, and increased government attempts to stimulate the digital economy. The area is home to many growing economies, notably Saudi Arabia, the United Arab Emirates, Qatar, and Nigeria, all of which are substantially investing in infrastructure development, including the construction of underwater cables.

Another important factor fueling the growth of the Middle East and Africa submarine cable market is rising investment in offshore wind projects. The area has a long coastline and plenty of wind resources, making it a suitable location for offshore wind farms. Submarine cables carry power from offshore wind farms to the mainland. Governments covering the Middle East and Africa are also taking steps to strengthen the digital economy. These measures include forming national broadband plans, supplying internet access subsidies, and establishing a favorable regulatory environment for the telecoms sector. These activities are likely to increase regional demand for undersea cables.

Report Scope

Report Metric Details
Segmentations
By Application
  1. Submarine power cables
  2. Submarine communication cables
By Voltage
  1. Medium Voltage
  2. High Voltage
  3. Extra-High Voltage
By End-User
  1. Offshore Wind Generation
  2. Inter-Country and Island Connection
  3. Offshore Oil and Gas
By Component
  1. Dry plant products
  2. Wet plant products
By Offerings
  1. Installation and Commissioning
  2. Upgrade
  3. Maintenance
Company Profiles ALE International ALE USA, Inc. SubCom LLC NEC Corporation Prysmian S.p.A Nexans Google LLC Amazon.com Microsoft ZTT.
Geographies Covered
North America U.S. Canada
Europe U.K. Germany France Spain Italy Russia Nordic Benelux Rest of Europe
APAC China Korea Japan India Australia Singapore Taiwan South East Asia Rest of Asia-Pacific
Middle East and Africa UAE Turkey Saudi Arabia South Africa Egypt Nigeria Rest of MEA
LATAM Brazil Mexico Argentina Chile Colombia Rest of LATAM
Report Coverage Revenue Forecast, Competitive Landscape, Growth Factors, Environment & Regulatory Landscape and Trends
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Segmental Analysis

The global submarine cable market is bifurcated into application, voltage, and end-user.

Based on the application, the global submarine cable market is bifurcated into submarine power cables and submarine communication cables.

The submarine power cable segment dominates the global market and will likely exhibit a CAGR of 5.6% over the forecast period. Increased demand for inter-country and island connections and new capacity expansions in the offshore wind industry drive the market. Furthermore, the growing number of offshore wind farms and the expanding electrification of offshore oil and gas networks have spurred R&D activity, boosting the need for submarine power cables.

The global submarine cables market is segmented based on voltage: medium, high, and extra-high.

The high voltage segment dominates the global market and will likely exhibit a CAGR of 5.8% during the forecast period. High-voltage cables with a voltage rating of more than 33kV are commonly utilized for power transmission and distribution. Thus, the key factors driving the market's high-voltage cable segment are increased investments in offshore wind power production and rising demand for HVDC submarine power cables.

Furthermore, HV cables decrease transmission losses, allowing for efficient power delivery. The HVDC power infrastructure is rapidly growing, allowing electricity to be transferred from large-capacity high-power sources to the mainland. DESERTEC, the North Seas Countries Offshore Grid Initiative, CIGRE, and other firms and development centers are assisting in creating HVDC power networks.

Based on end-users, the global submarine cable market is divided into offshore wind generation, inter-country and island connection, and offshore oil and gas.

The offshore wind generation segment is the most significant contributor to the market and will likely exhibit a CAGR of 6.1% over the forecast period. The key driver driving market expansion is increased investment in offshore wind power production and submarine power cables for long-distance power transmissions from these facilities.

Based on components, the global submarine cable market is divided into dry plant products and wet plant products.

The dry plant products segment is the most significant contributor to the market and will likely exhibit a CAGR of 7% during the forecast period. This is because of cost-effectiveness and recent advancements in the dry plant, such as SDM cables with more fibers and capacity, aluminum conductors, smart cables for earthquake and tsunami emergency alerts, repeater pump farming, virtualized submarine networks, artificial intelligence, and machine learning in submarine systems.

Based on offerings, the global submarine cable market is divided into installation and commissioning, upgrade, and maintenance.

The installation and commissioning segment is the most significant contributor to the market and will likely exhibit a CAGR of 7% over the forecast period. This is because of the high cost of installation equipment and technological procedures. Submarine cable boats, jointing and testing equipment, operation control software, and underwater installation equipment are all part of submarine cable deployment equipment. Beach burying equipment, a burial machine, underwater robot remotely operated vehicles, and an automatic control system comprise the underwater installation equipment for undersea optical cables. Over the projection period, the segment is likely to see attractive growth potential.

Market Size By Application

Market Size By Application
  • Submarine power cables
  • Submarine communication cables
  • Recent Developments

    • March 2023: Google announced the acquisition of Cologix, a provider of data center and submarine cable landing station services. Google made the transaction as part of its endeavor to extend its worldwide network infrastructure.
    • April 2023: Facebook partnered with Aqua Communications to establish a new underwater cable system named Echo. The new network will link the United States, Europe, and Africa.

    Top Key Players

    Submarine Cables Market Share of Key Players

    Submarine Cables Market Share of Key Players
    ALE International ALE USA, Inc. SubCom LLC NEC Corporation Prysmian S.p.A Nexans Google LLC Amazon.com Microsoft ZTT. Others

    Frequently Asked Questions (FAQs)

    What is the estimated growth rate (CAGR) of the submarine cables market?
    The market size is growing at a CAGR of 6.1% from 2023 to 2031.
    Asia Pacific has the largest share of this market.
    Increasing investment by OTT providers is the key driver for the growth of this market.
    The key players in this market are ALE International, ALE USA, Inc., SubCom LLC, NEC Corporation, Prysmian S.p.A, Nexans,Google LLC, Amazon.com, Microsoft,ZTT.
    The Projected value of this market is USD 44.96 billion by 2031.


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