Over the last three decades, nearly one million miles of submarine internet cables have been laid beneath the ocean, an invisible digital lifeline crucial to global connectivity. Yet, their distribution remains heavily skewed toward wealthy regions like North America, Europe, and East Asia, leaving much of the developing world digitally underserved.
According to the latest emerging market insights by International Finance Corporation (IFC), investment in undersea infrastructure is set to surpass USD 13 billion between 2025 and 2027, nearly double the total spent from 2022 to 2024.
This surge is largely driven by the rise in global data demand and the growing importance of data centers, over half of which are located in developed markets.
However, despite the presence of mobile phones in many emerging economies, only 27% of people in low-income countries have mobile broadband subscriptions, and fixed internet remains a luxury for many.
Cost has been a dominant and critical barrier. In Sub-Saharan Africa, for example, a fixed internet subscription costs nearly 20% of average monthly income, far exceeding the International Telecommunication Union’s (ITU) affordability target of 2%. By contrast, wealthier countries typically pay less than 1% of monthly income for similar services.
The IFC report shows that doubling undersea cable capacity can lower internet prices by 30–50%.
Increased capacity ensures greater bandwidth per user, reducing costs for both service providers and end users. Moreover, countries with more cable connections enjoy more stable and resilient networks, which are essential in a world increasingly reliant on digital services for education, business, healthcare, and government functions.
However, more cables alone aren’t enough. The IFC report warns that in countries where access to new cable infrastructure is monopolized or poorly regulated, competition dwindles. This results in stagnating, or even rising, internet prices over time, despite the added capacity. Effective regulation, therefore, is essential to ensuring open access to cable landing stations (CLS) and fiber backbones and preventing market concentration.
Real-world examples illustrate this dynamic:
- Kenya, after adding the SEACOM, TEAMS, and EASSy cables in 2009–2010, saw broadband prices drop by over 90%. Internet use grew fivefold between 2010 and 2023, transforming the country into a digital innovation hub.
- India combined submarine cable expansion with pro-competition policies, resulting in one of the world’s most affordable broadband markets.
- Brazil enforced infrastructure sharing and pricing regulation, doubling its fixed broadband penetration between 2010 and 2020, while reducing consumer costs.
Beyond affordability, undersea cables also boost economic development. Studies cited in the report show that fast internet access raises per-capita gross domestic product (GDP), increases employment by up to 13% in African manufacturing sectors, and improves firm productivity (also by 13%).
In conclusion, the IFC report positions undersea cable investment as a high-impact strategy for digital inclusion in emerging markets. That being said, infrastructure must go hand-in-hand with competitive regulation to truly close the global digital divide and unlock inclusive economic growth.
