"The only way to create a market is to have a competitive system," says Deep Blue Cable

24 May 2018 | Natalie Bannerman

the adoption of IoT is growing in popularity meaning bandwidth and subsea cable demands are increasing too, Stephen Scott, CEO of Deep Blue Cable says that his company provides the alternative needed to meet this demand

Stephen Scott 680 width

We, of course, know about the Deep Blue Cable Subsea Network due for service in 2020, but what is the need driving the project and what is the current status of the project?

Across the Caribbean, bandwidth demand is expected to increase and exceed 35% growth annually to 2025. However, the existing subsea infrastructure is not sufficient to meet the forecast demand. Moreover, some of the region’s primary undersea cable links are fast approaching their planned design life of 25 years. The advantages of Deep Blue’s cable over these older systems include significantly higher design capacity, lower unit costs, lower latency through direct connectivity, and the ability to leverage advancements in reliability, including improved route planning and installation techniques.

As for the current status of the project, route survey activities for Deep Blue’s pan-Caribbean undersea cable are planned to start this or early next quarter, with manufacturing and installation continuing this year and into 2019. Deep Blue has now completed all terrestrial cable landing surveys and is working to engage landing parties on many of the islands. Initial business enquiries in the Deep Blue subsea network are going strong and we continue to engage with operators interested in significant capacity or fibre purchases.

2)     Last year, you sat on the keynote panel at Subsea Connect Americas where it was said: "C&W serves that region very well with multiple cable systems, however, you can’t avoid the fact that there isn’t an alternative. Businesses in the region need an alternative." – Why do businesses in the region need this alternative so badly? 

The only way to create a market and to some extent create an affordable product for so many of the islands and countries is to have a competitive system. In addition to the resiliency offered by a second system, it will help to alleviate risk. Why has it taken this long for an alternative, like Deep Blue, to arrive? The only possible way to finance an alternative is to have a significant anchor client that is independent of the incumbent monopoly provider. Digicel is the only regional operator with sufficient scale to be that anchor. And so its support as a significant equity partner with many interests and a long history in the region, and most notably Digicel founder and chairman, Denis O’Brien, have been critical to building the business case.

Alternative subsea networks ultimately mean that prices will go down. Also, opening the market to competition provides options to improve communications and make connectivity more cost-effective, enabling business growth opportunities for Caribbean-based and multinational organisations.

By ensuring competitive pricing and resilience through alternative supply, the Deep Blue cable will provide connectivity to international and regional telecommunications operators, regional network providers, OTT providers, data centres, government, and large enterprises.

As the operator of a subsea fibre network in the pan-Caribbean region, would you say that there’s a big difference in the needs for capacity, speed, pricing etc., in comparison to say, Europe or North America? If so what?

The primary difference is economic. The price of Caribbean capacity is at least 12 times more expensive than transatlantic capacity, six times more expensive than transpacific capacity, and 2.5 times more expensive than capacity between the US and Brazil.

What unique opportunities are there in the subsea pan-Caribbean region and how is Deep Blue capitalising on these opportunities?

Although in a nascent stage of development, the IoT is gradually gaining a foothold in the Caribbean and increasingly smart devices and appliances are becoming available in the market. Regional stakeholders such as the Caribbean Network Operators Group (CaribNOG), the Caribbean Association of National Telecommunications Organisations (CANTO), and the Caribbean Telecommunications Union (CTU) have all become active in the discussion of how to enable IoT across the islands.

The construction of the Deep Blue cable will become critical in supporting the bandwidth demands of the IoT and its widespread adoption throughout the Caribbean.

How do you think the investment of OTTs has affected the subsea cable market? Are we seeing the end of the operator dominated cable consortium?

There’s no question that OTTs are leading the growth of new-build cable systems, specifically, transoceanic subsea networks. But the larger subsea cables owned by OTTs will also provide opportunities for convergence between the transoceanic and regional markets. While OTTs are not investing in smaller markets, they are indirectly serving undeserved regions of the world by facilitating broader global connectivity.

In so far as the future of the operator dominated cable consortium, I believe we’ll start to see more innovative collaborations, such as the recent pact between Seaborn Networks and Aqua Comms to provide a new subsea route between South America and Europe by interconnecting Seaborn’s Seabras-1 cable directly with Aqua Comms’ America-Europe Connect subsea cable network.

Witnessing the development of the HAVFRUE submarine cable system, a consortium that includes Aqua Comms, Bulk Infrastructure, Facebook and others to construct an undersea network between the US and Northern Europe, I don’t anticipate that the consortium model will disappear entirely from the industry.

What are your thoughts on the increasing number of cable projects forgoing the cable landing station and connecting directly to the data centre? 

To improve performance and lower costs, subsea network owner-operators are increasingly terminating new subsea cables directly in network and cloud-rich colocation data centres, thereby eliminating the additional hop through the traditional cable landing station. 

While this has traditionally been seen in developed markets, it’s important to remember that more than 10% of the world's internet users are in the Latin American-Caribbean region. Infrastructure growth requires more reliable and resilient connectivity, which will fortify business opportunities within and serving the Caribbean.

In addition to growing subscriber populations, regional growth in bandwidth demand is being driven by advanced generation mobile phone services, cable TV and OTT services. Investment in terrestrial backhaul and domestic network capacity has also led to an increase in aggregate demand for off-island capacity in all markets. So, as globalisation continues to reach emerging economies such as the Caribbean, we’re likely see more regional data centres connect directly with submarine cables, especially as multinational enterprises seek to expand their footprint in the islands, driving new infrastructure investments.

Beyond the subsea cable due for deployment in 2020, what’s the future roadmap for Deep Blue? 

The Deep Blue Cable network will offer an initial capacity of 6Tbps per fibre pair, which may be upgraded to 20Tbps per fibre pair over the life of the system. The undersea network is designed to be fully looped with many cables at unique landing sites. While Deep Blue has 22 landings planned in Phase I, the system ultimately has more than 40 landings planned in the Caribbean, mainland US, and South America.

Topics: Deep Blue Cable, Stephen Scott, fibre, subsea, cable