SACS, the first South Atlantic Cable System

Telegeography reported there are 366 subsea cables with 1006 cable landing stations globally and this includes subsea cables that are currently active, under construction, or expected to be fully-funded by the end of 2020. A market survey indicates nearly 30 cables are under construction and new announcements would be in addition to it. Undeniably, that’s quite impressive market landscape of subsea cables.

Above all, each new subsea cable will hasten price erosion and set new benchmarks for 1G, 10G and 100G pricing. In fact for some of the newer breed of subsea cables that were RFS in 2017, activating anything less than 10G seems economically unattractive. This has already led to a stage where 10G is the new STM1 in the era of Petabyte and Exabite data transfer and storage.  As cascading effect Internet access will expectedly become more affordable for next-one-billion underserved residents of emerging markets, that are stepping into the world of education, healthcare and banking through mobile Internet. That’s why more the better seems to answer to why we need more subsea cables. Let’s take a closer look at factors that are common with the new subsea cables and how they come closer to customer, enterprise and carrier, expectations.

Carriers, Content providers and Enterprise customers alike, have had challenges with subsea cables landing with large incumbent carriers for monopolistic dynamics. While the scenario is changing for good, apprehension still lingers when considering such cables. Preference is clearly for new subsea cables that presumably come with new mindset, landing with agile and nimble footed next-gen carriers or carrier-neutral datacenters.

Subsea cables with direct PoP to PoP connectivity are certainly preferred over those that terminate in cable stations as options for onward backhaul connectivity or interconnect with other subsea and terrestrial cables are stifled. Hence subsea cables that land with carrier-neutral datacenter providers prominently Equinix are certainly preferred. Further, with cable capacity extended to Equinix Cloud Xchange (ECX), any other Enterprise or Carrier or Cloud Service Provider connected to ECX can use their self-service portal for near real-time provisioning of cross-connect. This approach becomes more meaningful as Equinix is or has interconnected connected most of its datacenters anyway blurring the distinction between IPL and cross-connect. Not just Equinix, other datacenter operators are also adopting similar approach. Equinix is more visible for pioneering efforts and leadership position.

Need for latency optimization is an ever growing demand. Low latency or LoLa (rhymes well with LoRa!) networks in conjunction with proximity hosting are new order of the day. Hence many of the new subsea cables are positioned as “most direct route” or "least hop route". Another important attribute with subsea connectivity is protected connectivity with fully diverse route without any single point of failure. This gained momentum in 2016-17 that witnessed heightened incidents of two subsea cables segments in a region experiencing cuts or disruption concurrently. Hence customers, prefer a pair of subsea cables that are totally diverse and deep dive on restoration options and timelines. They demand KMZ files to validate route diversity, that becomes challenging while working with incumbent monopolies.

Having a consortium member like Google, Microsoft, Facebook or Amazon adds a uniquely marketable differentiation to new subsea cables. Possibly the cost pressures are also defrayed to considerable extent. Further it can be expected that completion timelines will be met, something that has plagued completion of most of the subsea cables. Click here for the list of publicly announced 24 subsea cables till March 2018 from Telegeography where these content giants have joined as consortium members. It remains to be seen if Netflix, Alibaba and even Oracle and Salesforce decide join this elite bandwagon.

For a new subsea cable, most of the consortium members, that are also consortium members in other subsea cables, it opens the opportunity for need-based capacity swap to create route diversity or acquire new routes. It’s not uncommon for large incumbent carriers to consortium members in 20 plus subsea cables. That also becomes a showcase for co-existence for collaboration in wholesale space and competition in enterprise space.

Along with consortium led cables, there are private subsea cables like those in Africa that include SEACOM, WIOCC, MainOne, Glo1, SACS. In LATAM there are encouraging moves from Seaborn Networks with their arsenal of subsea cables that include Seabras1, AMX-1, ARBR and SRBR. Of course there are many more like IOX, GBI, FLAG and the TGN family of subsea cables from Tata Communications. These subsea cables have their own differentiators, focused addressable markets, collaborative initiatives and compete and collaborate very well with consortium built cables. 

To conclude, the subsea cables will be the underwater growth engine of the digital transformation initiatives globally. We should have more of them, such that global connectivity becomes more affordable, stimulates more capacity consumption, brings emerging markets at par with developed markets and becomes the change agent to usher economic prosperity for masses in developing markets.

I invite views and counter opinion from subject matter experts to enrich this topic further.

(The views expressed by the author in this article are his own and not necessarily relates to the organization the author is attached to)