Saturday, May 24, 2008

A New Boom in Undersea Cable Laying

The Economist reports, based on a Telegeography study, that there is a new boom in the laying of undersea fiber optic cable. This one is smaller than the boom that peaked in 2001 when network operators such as Global Crossing spent nearly $13.5 billion laying undersea cables (see graphic). That boom turned to bust. However, according to Alan Mauldin of TeleGeography, the current boom is much more rooted in reality. Above all, demand is now indeed growing fast, driven by video and music traffic. Between 2002 and 2007, worldwide demand for international bandwidth grew at an average rate of 52% a year. Nevertheless, today less than a quarter of the fibre-optic strands on the chief undersea routes have been “lit”, or switched on. The need for bandwidth is not the only reason for laying cable. In addition, network operators need back-up connections and alternative routes in case cables get cut, which often happens.

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