THE AFRICAN DATA CENTER BOOM - Xalam Analytics

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THE AFRICANDATA CENTERBOOMCLOUD, HYPERSCALE, ANDTHE TRANSFORMATION OFAFRICAN COLOCATIONMARKETSReport summary &table of contentsNOVEMBER 2018 EDITION

Report Summary: The African Data Center Boom At long last, the African data center boom is here. After years of strong promise, but relatively slow expansion outside of South Africa, the African data center markethas entered a phase of accelerated growth. The year 2018 marks an inflection point. More multi-tenant data center facilities will be built across Africa over the next twoyears than were established over the past three combined. Data center colocation space, power, and revenue are all set to double over the next five years. Moreenterprises are adopting colocation services. Global CDN players are bulking up their African edge node presence. And crucially, the hyperscale cloud is here,transforming colocation demand patterns and volumes, altering the colo market’s traditional competitive structure, business models, and the very nature of Africa’sdata center facilities. The African Data Center Boom is our most comprehensive research to date on the African data center colocation market, leveraging months of research and interviews,extensive data collection and new analytical tools for data center analysis and geo-mapping. The report provides an unprecedented view into the dynamicsunderpinning the African Multi-tenant Data Center colocation market – all with the Xalam team’s uncompromising focus on finding investor value – wherever it maybe. Among key findings, the report outlines: Why the foundations for African colocation market growth are increasingly solid.Why some markets are driven by carrier-neutral players, while others are telco-dominated;The future of African colocation supply;The nature of African enterprise demand for colocation;The impact of hyperscale providers on African demand for data center colocation;Why we say that MTDC colocation is one of the hottest growth segments in the African ICT market;Why we broadly categorize the African data center colocation opportunity as follows: one sure thing (South Africa), four “next best” markets, three potentially strong,but stunted markets and five hidden gems (Angola, DRC, Uganda, Zimbabwe and Djibouti). A reference report for all players and investors in the African colocation and cloud markets. Xalam Analytics LLC - 20182

Report Structure OverviewPART IPART IITHE FOUNDATIONS, FROMCONNECTIVITY TO POWERINFRASTRUCTUREBREAKING DOWN AFRICA’SCOLOCATION SUPPLY CAPACITYP.22p.16PART VINVESTING IN AFRICANCOLOCATION: A COUNTRY VIEWP.47 Xalam Analytics LLC - 2018PART III:PART IVFROM HYPERSCALE TO SMES,BREAKING DOWN AFRICANDEMAND FOR COLOCATIONSERVICESFORECASTING AFRICANCOLOCATION: ALL THE SIGNS AREPOINTING UPP.31P.43PART VIINVESTING IN AFRICANCOLOCATION: A PROVIDER VIEWPART VIICOUNTRY FOCUSP.60P.533

Table of ContentsEXECUTIVE SUMMARY: THE AFRICAN DATA CENTER BOOMPART I: THE FOUNDATIONS, FROM CONNECTIVITY TO POWER INFRASTRUCTUREThe foundations: we have entered the age of African digitalConnectivity markets are undergoing significant transformationCharting the readiness for colocation – the international capacity infrastructure is excellentReadiness for colocation – the terrestrial segment is improving, but still a bottleneck in spotsReadiness for colocation – improving, but still fragile power infrastructurePART II: BREAKING DOWN AFRICA’S COLOCATION SUPPLY CAPACITYA snapshot of Africa’s data center colocation supplyHow many multi-tenant data centers are there in Africa?How large are African data centers?African colo space supply – a map viewAfrican colo space supply – double 2015 levelsAfrican colocation – four distinct market groupsA metro view of African colo supply – There’s Gauteng, then everybody elsePART III: FROM HYPERSCALE TO SMES, BREAKING DOWN AFRICAN DEMAND FOR COLOCATION SERVICESA snapshot of African demand for data center colocationEstimating African colo demand: the wholesale sideAfrican colo demand: the retail sideAfrican demand for colocation – summary chartsBreaking down demand for colocation – an explosive growth in the number of ASNsAfrican colocation demand: international providers and CDNsThe hyperscale are coming to Africa: how much colo capacity do they need?The outsized impact of the hyperscale on African colo demandAfrican enterprise demand for colocation services – The gap from “potential” enterprise demand to actual leased space is significantPART IV: FORECASTING AFRICAN COLOCATION: ALL THE SIGNS ARE POINTING UPThe outlook for the African data center colocation marketAfrican colo outlook – it’s a data center colocation boomColo revenue outlook – still the hottest growth area in the African ICT market4

Table of ContentsPART V: INVESTING IN AFRICAN COLOCATION: A COUNTRY VIEWAfrican potential demand for colocation services is highly concentratedMarket attractiveness to colocation: the core opportunity marketsMarket attractiveness to colocation: the secondary opportunitymarketsBeyond South Africa – our market attractiveness matrixCOUNTRY COLOCATION FOCUS: NIGERIANigeria: MTDC colocation market snapshotNigeria: MTDC colocation attractiveness ratingNigeria – After the slowdown, 60% more supply comingNigeria colocation: Key data and projections*Nigeria – Colocation demand reviewNigeria: Key colocation player summaryPART VI: INVESTING IN AFRICAN COLOCATION: A PROVIDER VIEWWho controls African colocation? Different colo fundamentals meandifferent market structuresWho controls African colocation? Africa’s Top 20 ProvidersStrong pent-up demand, migration to the edge is driving new breed ofcolo players outside of South AfricaOutside of South Africa, new dedicated colocation players areemergingWho controls African colocation? The rise of TeracoTeraco: A growth story in key chartsCOUNTRY COLOCATION FOCUS: MOROCCOMorocco: MTDC colocation market snapshotMorocco: MTDC colocation attractiveness ratingMorocco – Shallow wholesale, but one of Africa’s deepest retailenterprise marketsMorocco – Colo supply growth is acceleratingMorocco: Colocation data center mapMorocco colocation: Key chartsMorocco: Key colocation player summaryPART VII: COUNTRY FOCUSCOUNTRY COLOCATION FOCUS: SOUTH AFRICASouth Africa: MTDC colocation market snapshotSouth Africa: MTDC colocation attractiveness ratingBreaking down demand for colocation services in South AfricaSouth Africa colo supply – the largest market in the entire AME regionSouth African colo supply – an evolving market structureSouth African colocation – a fragmented market here, a concentratedmarket thereSouth African colo outlook – a 2018 inflection pointSouth Africa: Key colocation player summarySouth Africa key player assessmentCOUNTRY COLOCATION FOCUS: TUNISIATunisia: MTDC colocation market snapshotTunisia: MTDC colocation attractiveness ratingTunisia – demand primarily retail, cloud-drivenTunisia: Colocation data center mapTunisia – Colo supply growth has largely stabilized – but revenue isacceleratingTunisia colocation: Key charts*Tunisia: Key colocation player summary5

Table of ContentsCOUNTRY COLOCATION FOCUS: KENYAKenya: MTDC colocation market snapshotKenya: MTDC colocation attractiveness ratingKenya colocation: Key data and projections*Kenya – Colocation demand reviewKenya: Key colocation player summaryKenya key player assessment – From EADC and iColo to Telkom KenyaCOUNTRY COLOCATION FOCUS: GHANAGhana: MTDC colocation market snapshotGhana: MTDC colocation attractiveness ratingGhana colocation: Key data and projections*Ghana – Colocation demand reviewGhana: Key colocation player summaryGhana key player assessment – No clear leader, but more competition is comingCOUNTRY COLOCATION FOCUS: COTE-D’IVOIRECote-d’Ivoire: MTDC colocation market snapshotCote-d’Ivoire: MTDC colocation attractiveness ratingCote-d’Ivoire colocation: Key data and projections*Cote-d’Ivoire – Colocation demand reviewCote-d’Ivoire: Key colocation player summaryCote-d’Ivoire key player assessment – Orange leads, others followCOUNTRY COLOCATION FOCUS: SENEGAL, UGANDA AND TANZANIASenegal: Lack of wholesale demand hampers colo potentialUganda: getting ready for take-offTanzania: Strong potential held up by supply side concerns6

List of ExhibitsMore than 100 4G networks are now operational in AfricaBroadband penetration is accelerating – Evolution of African median penetration of the populationThe bandwidth is here: Evolution of Sub-Saharan African submarine cable equipped capacityInternational bandwidth demand vs. supply in sample marketsAfrica Terrestrial Fibre – Competitive Context Map - 2017 EWhere they are – a Mapping of Africa’s multi-tenant data centersEvolution of African median MTDC sizeDistribution of African MTDCs by Size - (2018E)**Median MTDC size by key African region (2018E)**Africa Colo Power Supply vs. Sample Major Colocation Markets (2018 E)Evolution of Africa MTDC Colocation White SpaceEvolution of Africa MTDC Colocation Gross PowerAfrica Colo Space by Core Market Grouping (2018 E)Africa’s Top Colocation Metros / RegionsAfrica MTDC colocation supply vs. revenue-generating demandAfrica colocation demand* vs. supply growth (CAGR over indicated period)African colocation revenue-generating demand as a % of estimated potentialAfrican colo demand – wholesale vs. retail splitEvolution of Africa’s Autonomous System Numbers (ASNs)Number of ASNs added annually in AfricaGlobal CDN Edge PoPs in Africa – A Map ViewGlobal CDN Edge PoPs in Africa – Distribution by ProviderPublic cloud data centers around the world – Q3 2018 (Operational Announced)Hyperscale traditional requirements vs. Sample largest SSA DCs*African data center power capacity – by DC target market*The Four Waves of Hyperscale ImpactEvolution of African colocation supply – white spaceEvolution of African colocation supply – gross powerEvolution of African colocation revenueAfrican colo revenue growth – Historical vs. ProjectionsDistribution of African Autonomous System Number (ASN) base – 2018 EDistribution of African edge PoP locations* – 2018 EDistribution of Africa’s formal SME and corporate base* - 2018 EShare of available colocation supply by carrier type – 2018 EAfrica’s Top 20 Colocation Players – Based on Owned Colocation Space - 2018 E*South Africa vs. Other Sub-Saharan Africa – Share of Key IndicatorsSample emerging colocation providers in African markets – 2018ETeraco: Evolution of Colocation Space – 2014 - 2019Teraco: Evolution of Power Capacity – 2014 - 2019Teraco: Evolution of Customer Base – 2014 - 2018Teraco: Evolution of Cross-Connects – 2013 – 2018 ECountry AnalysisSouth Africa colocation supply – vs. other regions (NAF, ME, SSA) - 2018South Africa colocation supply – Distribution by Key MetroSouth Africa colocation supply – Share by Provider TypeSouth Africa colocation supply – Share of capacity to wholesaleSouth Africa colocation supply – Share by Provider – spaceSouth Africa colocation supply – Share by provider – powerSouth Africa colocation supply outlookSouth Africa colocation revenueSouth Africa colocation market position – as of Q4 2018*Nigeria colocation supply – Share by focus of the facilityNigeria – Sample ongoing datacenter projects – as of Q4 2018Nigeria MTDC colocation - RacksNigeria colocation – Share of rack supply by provider – 2018 FNigeria MTDC colocation – gross powerNigeria colocation – Supply vs. Potential DemandNigeria colocation market position – as of Q4 2018*Morocco – Sample ongoing datacenter projects – as of Q4 2018Morocco MTDC colocation - RacksMorocco colocation – Share of rack supply by provider – 2018 FMorocco MTDC colocation – gross power – based on focus of the facilityMorocco Share of rack supply by provider type – 2018 F vs. 2020 FMorocco colocation market position – as of Q2 2018*Tunisia MTDC colocation - RacksTunisia colocation – Share of rack supply by provider – 2018 FTunisia MTDC colocation – gross powerTunisia Share of rack supply by provider type – 2018 FTunisia colocation market position – as of Q3 2018*Kenya MTDC colocation - RacksKenya colocation – Share of rack supply by provider – 2018 FKenya MTDC colocation – gross powerKenya: Colo Demand estimatesKenya colocation market position – as of Q3 2018*7

List of Exhibits (2)Ghana MTDC colocation – Racks*Ghana colocation – Share of rack supply by provider – 2018 F**Ghana MTDC colocation – gross power*Ghana colocation demand estimatesGhana colocation market position – as of Q3 2018*Cote-d'Ivoire MTDC colocation – Racks*Cote-d'Ivoire colocation – Share of rack supply by provider – 2018 F*Cote-d'Ivoire MTDC colocation – gross power**Cote-d’Ivoire demand estimatesCote-d'Ivoire colocation market position – as of Q3 2018*Senegal MTDC colocation – Racks*Uganda MTDC colocation – Racks*8

Markets & Companies CoveredThis report focuses on Africa at a broad level, with countries covered at varying levels of depth. Countries and players covered are as follows: The core analysis of the report is driven by insights and data generatedMarkets Coveredwith Good Depthprimarily from these markets; We provide a country-focused analysis of colo market size, key players,estimated market share, revenue outlook Specific country-focused profile, key trends, projections and other analysis: The core analysis of the report is driven by insights and data generatedprimarily from these markets;Other MarketsCoveredCompaniesMentioned Xalam Analytics LLC - 2017 Key trends and dynamics are explored and highlighted throughout thereport - but no specific country profiling 21st Century TechnologiesAkamaiAmazon Web ServicesBCXCloudExchange NigeriaDjibouti Data CenterEtix EverywhereEtix NgoyaGoogle Hetzner SA Huawei iColo IS/Dimension Data Liquid Telecom/Africa Data Centres MainOne Maroc Telecom Medallion Communications South AfricaNigeriaKenyaGhanaCote-d’Ivoire MedasysMTN BusinessN OneNetflixNSIA TechnologiesOoredoo TunisiaOrange BusinessPAIXRack ptDRCDjiboutiZimbabwe Rack CentreRaxioSafaricomTelkom KenyaTeracoTigo SenegalTunisie TelecomVodacom Business9

African colo space supply – a map viewAfrican Colocation – View of the FacilitiesEach circle represents a data center facility; circle size reflects the facility’s relative size; full facility detail (location,type, capacity, owner) available in the Xalam colocation market dashboards.Source: Xalam Analytics ResearchAfrican Colocation – View by MetroEach circle represents a metro market; circle size reflects the market’s relative size, in square meters.Source: Xalam Analytics Research10

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The analysis in this report is powered by the Xalam Africa colocation dashboards A powerful, AWS-based, interactivevisualization tool - that transformshow you see and absorb Africanmarket data Combining years of extensiveresearch, data collection, colomarket analysis and modelling withthe latest analytics technology Flexible access options See Africa colocation data at country, metro level10 country markets. 30 metros. 150 facilities.Get full detail on estimated colo demand and supply–Space, power, facilities, revenue by demand segment, etc.Request a demo today – hello@xalamanalytics.com

Report Specs: 2 Budget OptionsStandard1-5 UsersUS 1,500PremiumCorporate LicenceUS 2,000Report Delivered in PDF FormatPackage delivered in PDF, Excel,Winzip or Box, including:Including:120 pages 70 Charts & VisualsReport in PDF – 120 pages& 70 Charts & VisualsA 20 Slide Executive Synopsis50 Charts with underlying chartdata in Excel format Xalam Analytics LLC - 201713

Reimagining African digitalinfrastructure data and insights. Xalam.@xalamanalyticswww.xalamanalytics.com

South Africa colo supply - the largest market in the entire AME region. South African colo supply - an evolving market structure. South African colocation - a fragmented market here, a concentrated market there. South African colo outlook - a 2018 inflection point. South Africa: Key colocation player summary. South Africa key player .

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