Exploring the New Wave of Subsea Cables to North America

Tim StrongeTeleGeography

NANOG 76

Topics to cover• Lots of new cables• Cable retirements• Content providers = big users• Price compression• Technology shifts

Disclaimer• Views in this presentation are my own; they

don’t necessarily reflect the panelists’ views• Especially the last slide, which Nigel hates

Recent cables

New U.S. cables (last 2 years)

Big $ going into the waterNew Cable Investment CAPEX, by Ready for Service Date

Planned cables

Planned U.S. cables (next 2 years)Route

CableName Owner(s) RFS

FiberPairs

LandingCountries

Latin America & Caribbean

Curie Google 2019 4 Chile, United States

Trans-Pacific Pacific Light Cable Network (PLCN) Facebook, Google, Pacific Light Data Communication Co. Ltd.

2019 Q3 6 Hong Kong, Philippines, Taiwan, United States

Trans-Atlantic Havfrue/AEC-2 Aqua Comms, Bulk Infrastructure, Facebook, Google

2019 Q4 6 Denmark, Ireland, Norway, United States

Trans-Pacific Hong Kong-Americas (HKA) China Telecom, China Unicom, Facebook, RTI, Tata Communications, Telstra

2020 6 Hong Kong, Taiwan, United States

Trans-Pacific JUPITER Amazon Web Services, Facebook, NTT, PCCW, PLDT, Softbank Telecom

2020 5 Japan, Philippines, United States

Trans-Atlantic Dunant Google 2020 Q3 12 France, United States

Latin America & Caribbean

Deep Blue Cable Deep Blue Cable 2021 8 U.S., Panama, and lots of Caribbean countries

Trans-Pacific Bay to Bay Express (BtoBE) Cable System

Amazon Web Services, China Mobile, Facebook

2021 Q2 6 Hong Kong, Malaysia, Singapore, United States

Trans-Pacific Southern Cross NEXT Singtel Optus, Spark New Zealand, Telstra, Verizon

2021 Q4 4 Australia, Fiji, Kiribati, New Zealand, Samoa, Tokelau, United States

Trans-Pacific SxS RTI 2021 Q4 6 Guam, United States

Cable retirements• Cable age not most important consideration• Economic obsolescence = key factor. Drivers:

– Cable capacity (more = lower cost per bit)– Upgrade costs– Loss of old IRU O&M revenue?

Lots of aging cables

Big users = just a few companiesInternational Capacity Usage by Network Type

Content really big on some routesInternational Capacity Usage by Network Type by Route, YE 2018

Fiber pairs: the new capacity constraintTrans-Atlantic Fiber Pairs (Each Rectangle = 1)

Global prices have converged10 Gbps Wavelength Price Multiples over London-New York, 2013 vs 2018

Technology Shifts• Fewer gains on capacity per fiber pair

– Shannon Limit = a real constraint• More emphasis on overall capacity per cable

– Far more fiber pairs per cable (“SDM”)

Technology shift -> lower fiber pricesApproximate IRU Prices for Minimum Investment Units (MIUs)

Even with fat cables, is it enough?Projected Number of New Cables Required across Atlantic