Submarine Cable Capacity - A Hutch's View

Below is a short summary of HGC's talk at PTC.

There are over 20 new cables in 2008/2009 around the globe!
New cable builds in the APAC region:

• Long haul --> TPE (Ph1), AAG, TGN-IA
• Short haul --> Matrix, Hokkaido-Sakhalin CS
• Upgrades --> SMW3, APCN2, JUS, PC-1
• Coming soon --> Unity, TPE (Ph2)
• In the pipeline --> SJC
  

Internet traffic trends : video content fuels bandwidth demand and growth.
Used subsea capacity: (citing Telegeography 2007E)

• Internet 72%
• Private 27%
• Voice 1%
  

Network topology varies from fishbone structure (e.g. TGN-IA) to ring (e.g. APCN2)
Factors considered:

• Shorter latency (TGN-IA)
• Cost optimization
• Route diversity
• CS diversity
  

Minimum Investment Unit (MIU): STM-1 --> Lambda/FP
Investment level :

• Consortium cable 2000 : USD 1 mn / STM-1 (USD 10 mn/STM-64)
• Cable build 2008 : USD 30+ mn / 0.5 FP (USD 1 mn/STM-64)
  

Upgrade policy: phased approach --> on demand basis by individual

Lesson learnt:

• Investment peaked in 2001, USD 12 bn --> consolidation post-2001, avg. USD 2 - 4 bn (est. till 2010)
• Diversity and restoration (Taiwan earthquake; new cable routes avoiding earthquake zone)
• Network resilience --> Collaboration , capacity swapping and mutual restoration; aim to enhance route diversity and restoration options

HGC focus:

• Hong Kong as Asia Pacific Regional Hub : CS to CS and PoP to PoP (subsea and terrestrial cables; within and beyond Hong Kong)
• Connectivity solutions Layer 1 to Layer 3 : Hardpatch, IPLC, L2 peering, international Ethernet, IP-VPN, IP Transit
  

APCN2 and TGN-IA / Source Telegeography