Submarine Cables Market Size, Share & Trends Analysis Report By Application, By Voltage (Medium Voltage, High Voltage, Extra High Voltage), By End User, By Offerings, By Component, And Regional Forecasts, 2023 - 2030

Report Overview

The global submarine cables market size was estimated at USD 27.57 billion in 2022 and is projected to grow at a compound annual growth rate (CAGR) of 5.9% from 2023 to 2030. The major factors driving the market are increasing investments in offshore wind farms, increasing data traffic, and investments by OTT providers to suffice the requirements. Submarine cables are widely used for power and communication applications. The submarine power cables are used for power transmission to the oil rigs, power generated from offshore wind farms to the power station, and inter-country and island connections. Increasing demand for interconnecting countries' power grids is the factor influencing the demand for low-power cables. Submarine communication cables are used for inter-region/country communications. Around 97% of worldwide internet traffic is entirely dependable on submarine cables, and with rising internet, the demand for submarine cables is increasing drastically. The rising focus on joining offshore renewable energy generation and increased energy security has driven the expansion of the market across the globe. These communication cables help in faster communication and carry a large amount of data traffic across the globe.

The submarine communication cables carry around 90% of the data traffic across the world. In addition, their total carrying capacity is in terabits per second. As a result, they are the most valued cable for OTT and communication providers such as Google, Amazon, Facebook, and Microsoft. For instance, in October 2021 NEC, the Japanese IT company NEC announced plans to build a huge submarine cable with four crore fiber optics for Facebook. The submarine will hold a capacity of up to 500mbps across 24 fiber pairs. Most economies consider submarine cables a vital component of the economy and have set regulations to protect them from threats. For instance, the Australian Communications and Media Authority (ACMA) has created safety zones that prohibit activities that can damage these cables linked through Australia & the Rest of the World. In addition, it legalizes the installation of new submarine cable projects.

The communication cables have observed a surge in demand due to increased data traffic. Regions such as Europe, the Middle East, Asia Pacific, and Latin America have noted rising investments in submarine communication cables. Companies such as Google, Facebook, Amazon, Microsoft are the primary influencers of the submarine cables. Google owns 10,433 miles of submarine cables internationally and 63,605 miles in consortium with Facebook, Amazon, and Microsoft. Facebook owns 57,709 miles, Amazon owns 18,987 miles, and Microsoft owns 4,104 miles of submarine cables. Amazon’s cables run from the U.S. to the Asia Pacific region, connecting Singapore, Japan, California, and Oregon.

The efficient power transmission and distribution systems from renewable energy sources and the growth of offshore wind farms are expected to fuel the overall market growth. For instance, the Government of Japan is constructing a floating wind farm 12 miles away from the seacoast and is expected to install 140 floating wind turbines by 2020.

Growing demand for submarine cables has led the manufacturers to actively participate in the installation & commissioning, upgrades, and maintenance of the submarine cables. For instance, in February 2020, The Europe India Gateway (EIG) submarine cable system was upgraded to fast-track and reinforce the connectivity amongst businesses in Europe, the Middle East, and India by Ciena Corporation.

Application Insights

The submarine power cable segment accounted for the largest revenue share of around 62.45% in 2022. Increased demand for inter-country and island connections and new capacity expansions in the offshore wind industry are driving the market. Furthermore, the increasing number of offshore wind farms and the increasing electrification of offshore oil and gas networks have increased research and development activities, further increasing the requirement for submarine power cables.

The submarine communication cables segment accounted for a significant share and is thus expected to grow with the fastest compound annual growth rate of 6.8% from 2023 to 2030. There has been a rapid increase in urbanization and economic activities, which will drive the growth in infrastructure and construction segments in both developing and developed countries. The demand from various sectors such as commercial, telecom, energy, and power industries is leading to expansion and up-gradation of infrastructure, which is anticipated to drive the demand for the market. Also, the rising focus on joining offshore renewable energy generation to join future renewable energy targets and increase energy security, providing energy access to remote landmasses, and interlinking national grids to economize energy use has driven the expansion of the market across the globe.

Voltage Insights

The high voltage segment accounted for the largest revenue share of around 65.5% in 2022. High voltage cables ranging above 33kV are widely used for the power transmission and distribution of power. Thus, the increasing demand for HVDC submarine power cables and rising investments in offshore wind power generation is the primary factor driving the high voltage cables segment in the submarine power cables market. In addition, HV cables reduce transmission losses and thus, allow efficient power transmission. The HVDC power system is evolving at high speed and permitting the transfer of electricity from big-capacity high-power sources to the mainland. Several companies and development centers support the growth of HVDC power systems, such as DESERTEC, North Seas Countries Offshore Grid Initiative, CIGRE, and others.

The medium voltage cables segment is expected to grow at a compound annual growth rate of 5.0% from 2022 to 2030. The growth is attributable to the utilization of MV cables in the offshore oil & gas infrastructure for power transmission. The demand from overseas oil & gas operations has been increasing, thus, driving the MV cables market.

End-user Insights

The offshore wind power generation segment accounted for the largest revenue share of over 45.4% of the overall market in 2022. Increasing investments in offshore wind power generation and usage of submarine power cables for long-distance power transmissions from these plants is the primary factor in flourishing the market growth. For instance, in August 2018, Northwestern NV awarded a contract to NSW (a subsidiary of Prysmian S.p.A) to develop the submarine cable system necessary for the offshore wind farm.

The offshore oil & gas segment is expected to grow at a significant compound annual growth rate of 4.7% from 2023 to 2030. Increasing deepwater drilling activities and subsea operations are expected to drive the market over the forecast period. Developing countries in Latin America, the Middle East, and Africa are undertaking new offshore oil & gas investments, influencing market growth. For instance, in March 2019, GTT established an oil & gas unit that is serving oil & gas companies for the secure transmission of data through its submarine cable.

Component Insights

The dry plant products segment led the component type of submarine cable market and accounted for 73.4% of the market. The dry plant products segment is expected to account for the largest market revenue share and provide solid growth opportunities. This is due to cost-effectiveness and recent advancements in the dry plant, such as SDM cables with more fibers and capacity, aluminum conductors, smart cables: emergency alerts for earthquake and tsunami, repeater pump farming, virtualized submarine networks, artificial intelligence, and machine learning in submarine systems.

The wet plant products segment is expected to expand with the fastest CAGR of 7.0% over the forecast period. A wet plant of submarine cable lies between the beach manholes, and submarine cable system equipment is installed between beach manholes. Submarine cables, tilt equalizers, OADMs, repeaters, branching units, gain equalizers, filters, and beach manholes are all components of the wet plant.

Offering Insights

The installation & commissioning segment dominated the market in 2022 and accounted for over 39% of the market. This is due to the high cost, installation equipment, and technological procedures required. Submarine cable deployment equipment includes submarine cable vessels, jointing, and testing equipment, operation control software, and underwater installation equipment. Underwater installation equipment for submarine optical cables consists of beach burying equipment, burial machine, underwater robot remotely operating vehicles, and an automatic control system. The segment is expected to witness promising growth opportunities over the forecast period.  

Over the forecast years, the upgrade segment is expected to grow at a promising CAGR of 7.0%. Installed cables are a valuable asset, and new technologies typically allow them to be used well beyond their original design specifications, both in terms of capacity and design. Upgrades to SLTE in cable landing stations usually take less than eight months to acquire and implement, compared to an average of 3 years to build a brand-new long-haul cable system (depending on the size).

Regional Insights

The Asia Pacific region accounted for the largest share of around 38.3% of the overall market in 2022. The region has the highest adoption and deployment of wind farms in the region, among which China holds the leading position. According to IEEFA, China had 4.6GW1 of operational offshore wind power capacity in 2018. It installed 1.8GW of offshore wind capacity in 2018 alone, which is 40% of the total 4.5GW added globally during the year. In January 2019, China approved 24 offshore wind power projects off the coast of Jiangsu Province with a total capacity of 6.7GW and an investment injection worth USD 18 billion. The projects are expected to be operational by 2020. China's largest utilities, including China Energy Group, China General Nuclear Power Corp., China Huaneng Group, and the State Power Investment Corp., are backing these offshore wind projects. In addition, in April 2020, Facebook acquired USD 5.7 billion stakes in Reliance Jio (India). Hence, contributing to the rise in demand for submarine cables in the region. The Asia Pacific area is rapidly becoming a center for direct investment in submarine cable infrastructure. The major participants in this are Google, Microsoft, and Facebook. For instance, Google has already invested in Asia's existing submarine cable space. Also, in 2021 Google has invested in the new subsea cable system initiated to connect Japan to Australia via Guam.

The market in the Latin America region is anticipated to grow at the second-highest compound annual growth rate of 5.2% from 2023 to 2030, owing to the increasing investments in wind farms and inter-country & 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 that will connect 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 also bolstering its existing cable investments in the region.

Regional Insights

In 2021, EMEA led the market, accounting for about 25.18% of total submarine communication cable revenue. Increasing investments in EMEA have spurred the demand. For instance, In March 2020, Altibox Carrier and Xtera, a submarine network technology, announced the construction of the Euroconnect-1 submarine cable from Norway to the U.K. begins. The network will have a capacity of up to 216 Tbps and will run between Stavanger in Norway and Newcastle in the UK.

Furthermore, governments are taking initiatives to rebuild the economy after the COVID-19 pandemic. Between Denmark and the United Kingdom, a 760-kilometer cable is being installed beneath the water, which will supply 1.4 million UK homes with green electricity from Denmark. An increase in the laying of submarine cables in Saudi Arabia will surge the market for submarine cables. For instance, in 2020, Google announced to lay a fiber-optic network to connect Saudi Arabia and Israel using submarine cable for opening a new corridor for global internet traffic; the submarine cable would cost about USD 400 million and will expand more than 5,000 miles.

The Americas regional market is anticipated to gain significant traction and expand at a CAGR of 7.8% over the forecast year. The upsurge is due to the fast-rising demand for digital services backed by submarine cable or data center infrastructure. For instance, in February 2020,  Microsoft announced its first set of cloud data centers in Mexico as part of a $1.1 billion investment over the next five years.

Key Companies & Market Share Insights

The key players that dominated the global submarine cables market in 2022 include Alcatel-Lucent, TE SubCom, and NEC Corporation. The other small and mid-size submarine cables providers focus on smaller projects in various regions. Many submarine cable suppliers are also involved in offshore oil and gas projects, undersea electrical cables, and other marine infrastructure projects across the globe. For instance, in December 2017, Alcatel Submarine Networks (ASN), part of Nokia, was awarded a turnkey contract (EPCI) by Statoil to supply and install DC/FO technology as the subsea control infrastructure for the Johan Castberg field in the Barents Sea. For instance, in November 2020, ZTT, also known as the Zhongtian Technology Submarine Cable Co. Ltd., collaborated with Jiangsu Zhongtian Technology Co Ltd and developed an insulation power system of 500 kV XLPE.

Google holds the most extended submarine cable named Curie Cable, linking Chile and Los Angeles. Thus, the majority of the companies offer and connect submarine cables with partnerships and contracts/consortiums. Therefore, these firms do not resell the capacity of cables as they finance cable investments. Some prominent players in the global submarine cables market include:

• ALE International, ALE USA Inc.

• SubCom, LLC

• NEC Corporation

• Prysmian S.p.A

• Nexans

• Google LLC

• Amazon.com, Inc.

• Microsoft

• NKT A/S

• ZTT

Submarine Cables Market Report Scope

Global Submarine Cables Market Report Segmentation

This report forecasts revenue growth at global, regional & country levels and provides an analysis of the industry trends in each of the sub-segments from 2017 to 2030. For this study, Grand View Research has segmented the submarine cables market report by application, voltage, end-user, offerings, component, and region:

• Application Outlook (Revenue, USD Billion, 2017 - 2030)

  • Submarine Power Cables

  • Submarine Communication Cables

• Voltage Outlook (Revenue, USD Billion, 2017 - 2030)

  • Medium Voltage

  • High Voltage

  • Extra High Voltage

• End-user Outlook (Revenue, USD Billion, 2017 - 2030)

  • Offshore Wind Power Generation

  • Inter country & island connection

  • Offshore Oil & Gas

• Offerings Outlook (Revenue, USD Billion, 2017 - 2030)

  • Installation & Commissioning

  • Upgrade

  • Maintenance

• Component Outlook (Revenue, USD Billion, 2017 - 2030)

  • Dry Plant Products

  • Wet Plant Products

• Regional Outlook (Revenue, USD Billion, 2017 - 2030)

  • North America

    • U.S.

    • Canada

  • Europe

    • U.K.

    • Germany

    • France

    • Norway

    • Denmark

  • Asia Pacific

    • China

    • India

    • Japan

    • South Korea

    • Australia

  • Latin America

    • Brazil

    • Mexico

  • Middle East & Africa

    • UAE

    • Saudi Arabia

    • South Africa

• Regional Outlook (Revenue, USD Billion, 2017 - 2030)

  • Transatlantic

  • Transpacific

  • Indian Ocean

  • Americas

  • EMEA

  • AustralAsia