- The telecommunications industry is undergoing significant changes with mergers, acquisitions, and infrastructure commoditisation.
- Hyperscalers are reshaping service demand and internet behaviour, impacting subsea system investments.
- Innovations in fibre optics, wireless, and satellite technology are driving new standards in the industry.
Michael Lim is the Co-Founder of Nexthop, an Australian telecommunications carrier specializing in wholesale dark fibre solutions since 2016. With over 8 years of experience at Nexthop, he has led the company in delivering customized network solutions for carriers, ISPs, and large enterprises. Additionally, Michael has been the Director of Anticlockwise since 2013 and BarNet since 2018, providing specialized technology services to Sydney’s legal community, expanding these offerings nationally under Anticlockwise.
The telecommunications industry is experiencing significant changes, marked by noise, consolidation, and a flurry of mergers and acquisitions. Disruption is evident, with companies like ours benefitting from it. The commoditisation of the internet, initially seen years ago, is now affecting infrastructure. This shift is beneficial for those owning infrastructure but challenging for RSPs relying on others’ infrastructure, prompting some, like Oz Broadband, to build their own.
Hyperscalers like Facebook, Google, Microsoft, and Amazon are reshaping service demand and internet behaviour. By controlling international networks and co-investing in subsea systems, they have altered the investment landscape, reducing the demand for organic traffic.
Michael Lim, Director of Nexthop
Over 30 years, traffic profiles have shifted dramatically. Initially, traffic flowed through a mix of international websites, CDNs, and IP transit demand. Now, the majority enters and exits via major players like Microsoft, Amazon, and Google, with international traffic utilisation dropping below 10%. This change is due to major players bringing capacity into the country.
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The internet’s geopolitical landscape is also evolving. US regulatory bodies like the FCC now prevent direct connectivity with certain nations, potentially creating two separate internets due to diplomatic concerns. Australia’s role as a tech innovation leader is solid, serving as a testbed for Asia Pac, with strong cloud adoption in enterprise and government.
Demand for fibre is increasing, with businesses purchasing services driven over fibre. Despite an oversupply and overbuilding, the market will favour providers offering comprehensive services. Innovations in fibre optics include incremental performance improvements and advancements in wireless and satellite technology, such as Starlink, which has become the go-to in regional Australia.
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Nexthop’s market positioning will evolve with its growth, catering to larger clients and hyperscale demand. With increasing enterprise and wholesale growth, Nexthop stands out by deploying capital wisely and maintaining close client relationships. Significant developments are expected soon.
About Nexthop
Founded in 2016, Nexthop is a privately funded, licensed telecommunications carrier providing wholesale dark fibre and IP connectivity services in Australia. As a challenger Telco, Nexthop focuses on customer-centric, flexible solutions not currently available in the market.
