Exploring the New Wave of Subsea Cables to North America

Tim Stronge TeleGeography 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 water

New Cable Investment CAPEX, by Ready for Service Date Planned cables Planned U.S. cables (next 2 years)

Cable Fiber Landing Route Name Owner(s) RFS Pairs Countries Latin America Curie Google 2019 4 Chile, & Caribbean

Trans-Pacific Pacific Light Cable Network (PLCN) Facebook, Google, Pacific Light Data 2019 Q3 6 , , Taiwan, United Communication Co. Ltd. States

Trans-Atlantic Havfrue/AEC-2 Aqua Comms, Bulk , 2019 Q4 6 Denmark, Ireland, Norway, United States Facebook, Google

Trans-Pacific Hong Kong-Americas (HKA) , , 2020 6 Hong Kong, Taiwan, United States Facebook, RTI, Tata Communications, Trans-Pacific JUPITER Amazon Web Services, Facebook, NTT, 2020 5 Japan, Philippines, United States PCCW, PLDT, Softbank Telecom

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

Latin America Deep Blue Cable Deep Blue Cable 2021 8 U.S., Panama, and lots of Caribbean & Caribbean countries Trans-Pacific Bay to Bay Express (BtoBE) Cable Amazon Web Services, , 2021 Q2 6 Hong Kong, Malaysia, Singapore, United System Facebook States

Trans-Pacific Southern Cross NEXT Optus, , 2021 Q4 4 Australia, Fiji, Kiribati, New Zealand, Telstra, Verizon 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 companies

International Capacity Usage by Network Type Content really big on some routes

International Capacity Usage by Network Type by Route, YE 2018 Fiber pairs: the new capacity constraint

Trans-Atlantic Fiber Pairs (Each Rectangle = 1) Global prices have converged

10 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 prices

Approximate IRU Prices for Minimum Investment Units (MIUs) Even with fat cables, is it enough?

Projected Number of New Cables Required across Atlantic