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Through
The Glass Cable he world's longest and largest fibre optic cable which connects Australia, Fiji, New Zealand and the United States went live yesterday, November 15, its owners said. The $US1.2 billion (F$2.8 billion) Southern Cross cable runs 30,500 km across the Pacific and the Tasman Sea in a giant loop. It is half owned by New Zealand's Telecom Corp with 40 per cent owned by Cable and Wireless optus in Australia and 10 per cent by MCI Worldcom. With just six strands of fibre, the Southern Cross cable has 120 times the capacity of the existing PacRim cable that was laid in 1992. This data capacity means two full-length movies can be transmitted along Southern Cross every two seconds, with a one-way response delay betwen New Zealand and the United States at 70-thousandths of a second. Cable marine manager Dave Hercus says the cable is buried at an average of 0.9 metres deep in the seabed. Burying the cable was important. "As the fishing vessels of the world get bigger and bigger and fish in deeper and deeper waters, cable companies like Southern Cross have to act to future-proof their cables and the information that flows along them," he said. The cable's optical fibres are set in a steel tube and coated in jelly. The cable is only 18mm in diameter but every 40 km is encased by a booster station. The cable network is almost 30,500km in length, consisting of two separate cables configured in three self-healing rings. When complete it will deliver 120 Gbit/s of protected capacity between Australasia and Hawaii, and 160 Gbit/s between Hawaii and the US mainland. Southern Cross was designed to remove the bandwidth bottleneck between Australasia and North America. The full capacity will deliver the potential for new online opportunities for Australasian businesses, and for North American businesses looking to participate in Australasia's growing online marketplace. The security of connection is catered for by it comprising two separate cables and employing self-healing triple ring architecture to provide fully protected capacity and network availability of greater than a claimed 99.999%. Construction of the Southern Cross network began in March 1998 and stage one is now completed. Laying the cable over the last two years has been largely without drama but the Fiji connection was made in the midst of its coup earlier this year. Technicians from the French company Alcatel needed daily military protection while they connected it to the country's local exchanges. Facts: Southern Cross Cables Limited is an independent company responsible for the design, construction, marketing and management of the Southern Cross Cable Network. SCCL is based in Bermuda and has offices in Wellington and Sydney. The company is owned by Telecom New Zealand (50%), Cable & Wireless Optus (40%) and Worldcom (10%). There are a variety of companies and joint ventures who have pre-bought cable capacity and are attempting to sell that capacity now. These companies do not have any ownership shares of the cable. The Southern Cross Cable Network consists of 29,000km of submarine cable and 500 optical repeaters (placed every 40-70km to boost signals), as well as 1,500km of terrestrial cable and nine cable stations (two each in Australia, New Zealand, Hawaii and the US mainland, and one in Fiji). The submarine cable system was laid by seven cable ships between July 1999 and May 2000. The cable's optical fibres are set in a steel tube filled with jelly to protect them from water penetration and hydrogen. This is protected by high-strength steel wires and surrounded by seam-welded copper to form the composite conductor. This is then insulated with high-density polyethylene - which also provides abrasion resistance - to form lightweight cable (approximately 18mm in diameter). Additional layers of galvanised steel wires are added where necessary to create armoured cable to protect the cable on the ocean floor. Southern Cross includes 2,425km of armoured cable, and the cable is also buried in the ocean floor in water depths of less than 2km. The maximum depth of the cable is 7,585m on the Kermadec Trench between New Zealand and Hawaii Power for the underwater amplifiers is provided by a DC current of 1.0A delivered from Power Feed Equipment at the terminal stations at up to 9000V DC potential. The Southern Cross network was designed, manufactured and constructed by a consortium formed by Alcatel and Fujitsu. Alcatel manufactured all of the cable, landing station equipment and some of the repeaters at its plants in Australia, England, France, Germany, Italy and the United States. Fujitsu also manufactured repeaters at its Japanese facility. Engineering services were provided by Cable & Wireless Global Networks. The network will be managed from a Network Operating Centre in downtown Auckland. The Hype: Various journalists have raised expectations that the cost of high speed data to New Zealanders will fall dramatically. If they are right, Telecom's billion and a half dollar investment in cable and millions of dollars more in routers and associated support for data transmission will start to take on a yellowish tinge. Telecom will be needing to re-coup its investment, a significant part of which would need to come from sale of cable capacity to third parties. In the classic pinser movement, the third party buyers will also be Telecom's greatest competitor in the international data market. Already there are rumblings that Telecom may not sell IP (Internet) data connectivity direct until the onsellers run-out of capacity, i.e. supply manipulation in order to influence pricing. Its hard to imagine that those who invested in ownership of the cable and equipment will seek to compete on price when they own most of the supply and are heavy users themselves of that supply. The hypsters seem to also have forgotten the third fundament of markets, demand. In New Zealand the number of companies in the buying market for Megabytes of international IP data is strictly limited, and falling. More, the biggest user of IP data is Telecom itself and the other Telcos (Telstra, British Telecom which owns Clear) soak up the majority of the rest. The Telcos are not going to be interested in beating the sale price to third parties either. So my prediction on price is, prices will fall, but the Telcos will cooperate on supply to third parties so that the internal company price for international IP falls the most while competing independent ISPs will not reap the true price benefits of Souther Cross. Telecom didn't put the cable in to hand its full price and speed benefits to other companies. However, that doesn't mean independent locally owned companies (of which there are less than a handfull in the ISP business) will go away. It is the locals who can supply what the Telcos can't and won't; intelligent and knowledgeable human contact, prices based on relatively low profit margins compared to that demanded by the investors in Telcos, immediate response to problems, personally designed service packages, pro-people and pro-environment business models. The independents, none of which are quite as independent as PlaNet, will meantime be conducting daily meetings with the new international IP sales teams in order to work the buyers market for the short time that market exists, and, we'll pass on the cost savings to those who support us with accounts
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