Submarine Cable Systems Market Size, Share Analysis

Updated on : Oct 22, 2024

The global submarine cable system market size to grow from USD 18.2 billion in 2024 and is expected to reach USD 29.7 billion by 2029, growing at a CAGR of 10.3% during the forecast period from 2024 to 2029. Factors Expanding Offshore Wind Power Capacity, and Increasing network of submarine power cable systems drives the submarine cable system Industry.

Submarine Cable Systems Market Forecast to 2029

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Submarine Cable System Market Trends

Driver: Expanding Offshore Wind Power Capacity

Globally, the need for subsea power cables is increasing due to the growth of offshore wind energy. Export cables, which connect an offshore substation to a land-based grid, and array cables, which connect surrounding wind turbines and transport electricity to the offshore substation, make up the market.

The Global Wind Report 2024 published by the Global Wind Energy Council (GWEC), the global offshore market is projected to experience significant growth, expanding from 10.8 GW in 2023 to 37.1 GW by 2028. This surge will elevate its share of new global installations from the current 9% to 20% by 2028. China and Europe are forecasted to maintain their dominance, collectively capturing over 85% of the global market share in 2024-2025. Over the period of 2024-2028, a total of 138 GW of offshore wind capacity is anticipated to be installed worldwide, with annual installations averaging around 27.6 GW. In Europe, over 42 GW of offshore wind capacity is anticipated to be developed between 2024 and 2028. The majority of this capacity, around 44%, is expected to be installed in the UK, primarily due to the anticipated commissioning of CfD Allocation Round 3, 4, and 6 projects. Germany is projected to account for 15% of the capacity, followed by Poland with 11%, the Netherlands with 8%, France with 6%, and Denmark with 5%. 

Restraint: Involvement of multi-country government bodies leads to complexities and delays in approvals

Submarine cables are laid on seabed across countries, leading to the involvement of different governments and authorities. Permits are required for the installation of submarine cables on the seabed for operational time or lifetime, and some of these permits require environmental studies, easements, seabed leases, and specific governmental legislative permissions. It is difficult to install submarine communication cables between countries due to the difference in rules and regulations of countries. Legally, the status of undersea cables has little protection, particularly when they are outside the jurisdiction of a state and lie on the seabed of high seas.

Governments and authorities are involved in the cable laying process, as the cables cross through the maritime boundaries of multiple countries. Regulations and approval procedures to control the development of submarine cable projects help governments ensure that the project development pays due regard to the interests of stakeholders on issues including national security, exploitation of natural resources, and protection of the environment. Thus, network operators, system suppliers, and maintenance authorities are expected to work in accordance with the regulatory regime throughout the development process. In each case, developers face a set of hurdles that must be overcome to proceed with the investment, including working with relevant institutions, meeting policy and regulatory requirements, getting stakeholder buy-in, and appropriately allocating costs.

The fact that interconnector development involves multiple jurisdictions adds to the complexity of development and requires an additional layer of cross-border collaboration. These complex procedures often lead to project delays. Subsequently, in situations where the timescale for permit approval is not defined, developers experience difficulties in planning project implementation effectively. Permit delays can lead to the installed assets being placed on standby, inefficient installation, and delays to overall system availability, thereby acting as a restraint for market growth.

Opportunity: Increasing investments by content delivery and streaming partners to create opportunities

The telecommunications industry has undergone a major shift over the last five years, with over-the-top (OTT) providers accounting for a substantial share of investments in submarine cables. To meet the ever-increasing demand for additional capacity, OTT players such as Google, Facebook, Microsoft, and Amazon are investing in submarine cable projects. As of February 2024, Google and Meta, driven by their extensive bandwidth needs for search, video, and social media platforms, have respectively contributed to the investment in 29 and 15 submarine cable systems. To meet the large and complex infrastructure requirements, content providers are shifting focus from being capacity purchasers to cable owners. The entry of OTT players in the submarine cable systems market indicates significant growth opportunities.

Challenge: Emergence of alternative modes of internet service provisioning

The global telecom industry is making huge investments in building a sturdy networking infrastructure using fiber optics, microwave, and radio stations for terrestrial communications and subsea cabling to connect nations and continents. Currently, international internet communications depend mainly on submarine cables. Majority of international data flow is transmitted via submarines cables. However, even with the massive network of subsea cables, huge populations worldwide remain unconnected or are facing disrupted connectivity, which, in turn, is restricting the use of these cables as the primary means of data transfer on a global scale.

StarLink, provider of satellite internet services from space to Earth's orbit. By 2023, StarLink had already launched 12,000 satellites into space, with plans to deploy around 42,000 satellites by 2025. These satellites predominantly operate in Low Earth Orbit (LEO), situated approximately 550km above the Earth's surface, ensuring enhanced connectivity, high internet speeds, and reduced internet drops. Each StarLink satellite typically weighs between 100 and 500 kg and is strategically positioned in space using advanced technology to minimize collision risks and optimize internet connectivity. Other companies in the satellite internet technology sector, such as Telesat (Canada), and HughesNet (US) have also developed infrastructure to provide futuristic and sustainable internet services based on satellite communications. This technology is addressing the challenge of providing internet access to remote areas where traditional internet infrastructure is impractical to establish. Thus, the enhanced speeds and capacities facilitated by new internet providers could restrict the usage and deployment of urban, cable-based systems and, therefore, have an adverse impact on the global submarine cable market

Submarine cable system Market Ecosystem

The submarine cable system market is competitive. It is marked by the presence of a prominent players, such as Alcatel Submarine Networks (France), SubCom, LLC (US), NEC Corporation (Japan), NEXANS (France), Prysmian Group (Italy),. These companies have created a competitive ecosystem by focusing on partnership, collaboration, and acquisition to achieve competitive advantage.

Submarine Cable System Market Segment

Upgrades segment to grow at the fastest CAGR during the forecast period.

Submarine communication cable upgrades are required to meet the capacity requirements within fixed budgets. A combination of careful planning, right equipment, and accurate field expertise is necessary to increase undersea network capacity. Innovations and upgrades in submarine communication cables enable developments in models, field trials, design methodologies, and power budget formulations to ensure successful upgrades in the coherent capacity installations of these cables

Multicore segment to achieve the fastest CAGR during the forecast period.

Multicore cables have lead sheaths to prevent water contact, conductor screens between different core conductors and insulations, and binder tapes and polypropylene string bedding around bundles of three conductors to keep them and fillers bound together. The outer side of the insulation layers has insulation screens, along with water-swellable tapes, metallic shields, and polyethylene jackets. These cables have an additional layer of galvanized steel armor with a polypropylene separator between armor layers and polypropylene, which leads to their large size and weight. A complete circuit can be laid in one trench using these cables, resulting in reduced installation and system costs

Oil-impregnated Paper to dominate market during forecast period.

OIP-insulated submarine power cables offer high voltage insulation and are usually employed for high-voltage DC transmission. These are also called mass-impregnated cables and are sustainable for the environment. This insulation type is the go-to for insulation for submarine power interconnectors, as it is suited for long-distance transmissions at extreme depths.

Regional Analysis

Europe to hold larger share of the market during the forecast period.

Europe hosts numerous offshore oil and gas projects, concentrated notably in countries such as the UK, Norway, the Netherlands, Italy, and Denmark. These projects, including Ekofisk, Montrose, Forties, Eldfisk, Dan, Brent, Frigg, Beryl, Sleipner, and Statford, are actively engaged in exploration and production activities, attracting fresh investments in the offshore oil and gas sector and subsequently fueling demand for submarine power cables in the region. Germany and the UK are poised for rapid growth during the forecast period.

Submarine Cable Systems Market by Region

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Top Submarine Cable System Companies - Key Market Players

The submarine cable system companies is dominated by globally established players such

• Alcatel Submarine Networks (France),
• SubCom, LLC (US),
• NEC Corporation (Japan),
• NEXANS (France),
• Prysmian Group (Italy),
• HENGTONG GROUP CO.,LTD. (China),
• ZTT (China),
• NKT A/S (Denmark), and
• LS Cable & System Ltd (South Korea).  These players have adopted product launches/developments, partnerships, collaborations, and acquisitions for growth in the market.

Submarine Cable System Market Report Scope 

Submarine Cable Systems Market Highlights

In this report, the overall submarine cable systems market has been segmented based on application, type, offering, voltage, component, insulation, end-user, and region.

 Recent Developments in Submarine Cable System Industry

• In September 2023 SubCom, LLC (US), expanded its manufacturing (more cables, faster production) and marine operations (new ships, deployment center) to meet the growing demand for undersea cables used in digital infrastructure. They've also increased their workforce by 20% to better serve customers.
• In April 2023, Sumitomo Electric Industries, Ltd. (Japan) announced plans to establish a new Power Cable factory (high voltage cable manufacturing plant) in the Scottish Highlands to support the UK Government’s goal to achieve Net zero in 2050.
• In April 2023, Nexans (France) successfully finalized the acquisition of Reka kaapeli oy, a leading Finnish manufacturer of high, medium, and low voltage cables, to become a key player in electrification and contribute to carbon neutrality by 2030.

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