Corning’s South African Optical Fiber Network Extends Reach

by Trefis Team
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FibreCo Telecommunications, a South African open-access network provider, is deploying Corning optical fibers in laying its new high-speed, 12,000 km long optical fiber network in South Africa. [1] The company began laying the network in April earlier this year and plans to complete 2,000 km long Phase 1, connecting Johannesburg and Cape Town by 2013 end.

The project assumes greater significance as it helps Corning (NYSE:GLW) increase its footprint in emerging economies, which still have relatively low density of optical fiber networks and are major markets for growth in the optical fiber industry.

Optical fibers are part of the company’s larger Telecommunications division, which constitutes nearly 4% of our estimated stock price for Corning. We have a Trefis price estimate of $16.50 for Corning, approximately 25% above its current stock market price.

See our full analysis of the Corning stock here

Corning’s optical fiber capabilities

Corning is supplying Corning® SMF-28e+® LL and LEAF® optical fibers in the project. SMF-28e+ LL fiber ensures low attenuation and low polarization mode dispersion (PMD) that maintains signal strength over long distances, and also allows higher repair margin, which is needed in case the fiber gets damaged. And, LEAF fibers are one of the most widely deployed optical fibers globally that allow networks the possibility to upgrade to higher data rates of 40Gb/s and 100Gb/s from the current 10Gb/s.

Increasing footprint in emerging economies to drive revenue growth

Emerging economies particularly, South Africa, India and China still possess immense appetite for optical fiber networks as significant increases in their terrestrial optical fiber capacities are required. Corning, which pioneered the optical fiber 40 years ago, has the technical expertise to capitalize on this demand and drive revenue growth for its shareholders.

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Notes:
  1. FibreCo telecommunications deploys Corning Optical Fiber for its next-generation network in South Africa, June 26th 2012, www.corning.com []
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