There's something in the water

There's something in the water

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The start of 2024 brought with it a slew of new subsea cable launches, and the end of 2023 closed in a similar fashion.

According to TeleGeography a new cable boom is expected between 2023 and 2025, valued at approximately $10 billion and totalling an estimated 78 systems online spanning over 300,000 kilometres in length.

Google’s central Pacific Connect initiative for example will deliver two new intra-Pacific subsea cables, Bulikula and Halaihai. Developed in partnership with Amalgamated Telecom Holdings (ATH), APTelecom, and Telstra, Bulikula will connect Guam with Fiji while Halaihai will link Guam and French Polynesia.

The company also unveiled plans for theSouth Pacific Connect initiative, a new project will deliver two new trans-Pacific subsea cables. Named Honomoana and Tabua, the two cables will help to increase the reliability and resilience of digital connectivity across the Pacific.

Then there’s Humboldt project, which Google has joined along with Desarrollo País of Chile (Country Development of Chile) and Office of Posts and Telecommunications of French Polynesia (OPT) to build a subsea cable connecting Chile, French Polynesia, and Australia.

In January, Intelia New Zealand confirmed plans for a new subsea cable project that will connect Invercargill in New Zealand to both Sydney and Melbourne in Australia.

The same month Sparkle’s GreenMedsystem was launched into the Adriatic Sea connecting Italy to Croatia, Montenegro, Albania, to Greece and Turkey, and into the Mediterranean.

At the end of December, RETN deployed additional capacityon its existing route connecting Hong Kong to Singapore via the Asia-Pacific Gateway subsea cable.

University of Hawaiʻi (UH) and Ocean Networks (ONI) announced plans for a new system called the Hawaiian Islands Fiber Link (HIFL), that will connect the Hawaiian Islands.

Ooredoo Group and e& earlier this month announced the deployment of the Gulf Gateway Cable (GGC1) subsea cable system.

Most recently Globe activated a segment of the Philippine Domestic Submarine Cable Network (PDSCN) from Luzon to Mindanao, in the Philippines.

The question Capacity asks is why?

New technologies and tools such as AI, Automation, AR/VR, video and streaming all contributing to data requirements, is it as simple as increased demand?

According to Lane Burdette, research analyst at TeleGeography, the numbers of cable projects are increasing due to a number of reasons, there’s no one answer and its more a culmination of things.

“Network operators build out their networks for a lot of reasons, several of which are converging over the next few years. Some older systems are reaching the ends of their lifespans, prompting routine replacement. Steadily increasing international bandwidth has also required new capacity deployments on existing routes,” she tells Capacity.

“For demand-hungry cloud and content providers, economic factors may incentivise the development of new cables, which provide massive blocks of capacity to use or swap. Plus, companies may be expanding their networks to prepare for a potential boost in bandwidth demand from the popularisation of AI tools.”

At the same time, she says that there are several subsea cables being developed on routes with lower demand requirements, usually with government support.

“These may seek to build network resilience by increasing diversity of landings and routes. They can also be designed to reach isolated populations or areas without robust connectivity,” Lane explains

As for the trends driving new cable buildouts, TeleGeography’s data indicates an increase in subsea cable investment over the next few years. Any cables that have entered service over the last decade, averaged around $2 billion in total construction costs. Interestingly, construction costs for cables scheduled to enter service this year are estimated at $5 billion.

“We estimate that more route kilometres will enter service in the next two years than in any time since the early 2000s. These numbers are boosted by the planned activation of several trans-Oceanic systems as well as 2Africa,” adds Lane.

Another driver to consider is that there was a building boom from 1997-2002.

According to Julian Rawle, principal at Julian Rawle Consulting:

"Submarine cables are supposed to last for 25 years which means that all those cables built in that boom era are potential retirees now!"

"There is a lot more to it than that but this is certainly driving new builds in the LatAm-Caribbean-North America market."

In the trans-pacific region, excluding Google’s recent announcements, TeleGeography estimates that $1.8 billion will be invested in building subsea cables entering service between 2023-2025, which Lane says “… is about 20% of global investment in cables over that same period”.

Beyond just the operator led cables, global governments are also getting in on the action. In November Vietnam confirmed plans to invest in two to four more international subsea cables with a capacity of 60Tbps, by 2025.

And who could forget the news that the Cayman Islands, in partnership with Cambridge Management Consulting, are to modernise its two subsea cables that are soon to reach the end of their lifecycle. Whether this is through an upgrade of some kind or with new cables altogether, has yet to be confirmed.

What is clear is that whether as a result of increasing data demands, network reliance in the face of disasters (see the recent Red Sea cable cuts), connecting the unconnected or bridging the digital divide, undersea cables remains the infrastructure of choice for connecting the world. As its development continues to ebb and flow over time, don’t expect it to be dethroned anytime soon.

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