Capacity Watch

Moscow - June 6, 2011

Rostelecom announced that it has wrapped up a deal with China Telecom to expand the capacity of the Transit Europe-Asia (TEA) system to 200 Gbps.

While the telecom industry is astonished by the announcement on April 11, 2011 that Level3 is going to acquire Global Crossing, and chating about its impacts on the industry, and analyst expecting that there should be acquisitions and mergings of the other operators so as to form considerable competitive advantages against the Levels and Global Crossing merger, it is coming the acquisition of Savvis by CenturyLink.

As mentioned in an early ariticle, the cable repair after the Japan earthquake may take longer, and the industry is nervse about any additional cable cuts.

Unfortunately, there were multiple cable cuts reported in Asia region, TPE, EAC and C2C were affected.

April 11, 2011, US time, Level 3 Communications, Inc. (NASDAQ:  LVLT) and Global Crossing Limited (NASDAQ:  GLBC) today announced that they have entered into a definitive agreement under which Level 3 will acquire Global Crossing in a tax-free, stock-for-stock transaction. The combined company will operate a unique global services platform anchored by fiber optic networks on three continents, connected by extensive undersea facilities. The combined network will serve a worldwide customer set with owned network in more than 50 countries and connections to more than 70 countries. This transaction will create a company with pro forma combined 2010 revenues of $6.26 billion and pro forma combined 2010 Adjusted EBITDA of $1.27 billion before synergies and $1.57 billion after expected synergies.

April 11, 2011, one month after the magnitude 9.0 Japan Earthquake,  the cable repair is still going on and it may take longer.

Submarine networks have demonstrated its importance for global communications, especially global internet which requires huge capacity. On the other hand, the whole submarine networks are still quite vulnerable, though there is increasing enhancement on diversity, redundancy and protection. Submarine cable cut occurs from time to time arround the world. Trawl fishing, vessel anchoring, nature disaster such as earthquake, typhoon and landslide are the main threats to the submarine networks.

On August 17, 2009, Magnitude 6.7 earthquake hit the east coast of Taiwan, after the spread of Typhoon Morakot on August 9, the deadliest typhoon to impact Taiwan in recorded history. Eight submarine cables were cut by the earthquake and landslides caused by the Typhoon Morakot.

On Tuesday December 26, 2006 at 12:25 UTC (20:25 local time), a maganitude 7.0 earthquake struck off the southwest coast of Taiwan, approximately 22.8 km west southwest of Hengchun, Pingtung County, Taiwan (the 2006 Hengchun/Taiwan earthquake). Eight submarine cables were cut after the earthquake and its aftershocks, catastrophically disrupted Internet services in Asia, affecting many Asian countries. Financial transactions, particularly in the foreign exchange market were seriously affected as well. The 2006 Taiwan Earthquak renderred significant impacts on submarine networks.

On February 29, 2008, Friday, the internet traffic capacity of PT Telekomunikasi Indonesia (Telkom) was down to 10 percent as undersea cable to Singapore, which connect the country to the rest of the world, failed to function.(The Jakarta Post: Internet capacity down to 10%)

In January-February 2008, multiple submarine cable cuts occured in the Persian Gulf and the Mediterranean regions. The cable cuts caused internet disruptions and slowdowns, affecting at least 60 million users in India, 12 million in Pakistan, six million in Egypt and 4.7 million in Saudi Arabia. The cable cuts  called into doubt the safety of the undersea portion of the Internet cable system.

On December 19, 2008, Friday, SEA-ME-WE 3 (SMW3), SEA-ME-WE 4(SMW4) and FLAG FEA undersea cable cuts occured at 7:28 a.m., 7:33 a.m. and 8:06 a.m. respectively.  The undersea cables were cut in the region where they run under the sea between Egypt and Italy. Seabone also went out Thursday evening in the same region. The undersea cables carry an estimated 90 percent of all data traffic between Europe and the Middle East.

2011 March 11 05:46:23 UTC, A magnitude 8.9 earthquake struck off the northeastern coast of Japan (modified to magnitude 9.0 later), at 38.322°N, 142.369°E and 373 km (231 miles) NE of TOKYO. The earthquake and its aftershocks and the tsunami resulted in multiple submarine cable cuts that threatening much of the intra-Asia and trans-Pacific telecommunications.

In a recent bid in Jan 2011 for IRU and Managed Hosting services, 10G IRU price for 15-year term over China-US submarine cable route went down to US$ 2.0 million.

SubCom (formerly Tyco Telecom) announced on 14 January 2011 that it has been contracted to provide the first 40G upgrade in a trans-Pacific submarine cable system more than 9,500km in length. The use of SubCom’s next-generation G4 SLTE enables the increase of cross sectional capacity by 100% to 1.92Tbps per fiber pair, a new record for trans-Pacific distance.

China Unicom Chairman, Mr. CHANG Xiaobing, visited Taiwan and signed on January 13, 2010 the Construction and Maintenance Agreement for Taiwan Strait Express-1 (TSE-1), for the construction of the first communication system directly linking Taiwan and Mainland China.