An international forum for the expression of ideas and First Quarter 2002 opinions pertaining to the submarine telecoms industry

1 Contents List of Advertisers

Editors Exordium 3 Undersea Intelligence on the Costa del Sol International Cable Protection Committee 5 EMEA Conference 30 Emails to the Editor 4 Global Marine Systems Ltd 5,6 The State of the Industry Network Maintenance 5 Europe, the Middle East, Africa and India TMS International 16 Christian Annoque 31 Sub Tech 7 Offshore Site Investigation Conference 18 Tracking the Cableships Sub Tell 8 Latest locations of the world’s cableships 36 International Subsea & Telecom Services 22 Ventures 9 Technology in Long-span Smit-Oceaneering Cable Systems 29,39,47 Submarine Systems Vessels 10 CTC Marine Projects 35 Tony Frisch 40 Searching for a light in the fog A future for the submarine cable industry? Fibre Optics in Offshore Michael Ruddy 11 Communications Jon Seip 45 Bandwidth ORGANISING A The State of the Market Letter to a friend CON ERENCE? Rex Ramsden 19 Jean Devos 52 Give your exhibition or conference Countdown to Apollo Launch maximum exposure to the submarine Australasian Communications Conference The world’s most advanced cable system telecoms industry. Advertise your event in A once-only chance to hear from influential Katherine Edwards 23 Submarine Telecoms Forum strategists and CEOs 56 The State of the Industry and reach all the key people. The Americas Diary Dates Email: [email protected]@subtelforum.com John Manock 27 Upcoming Conferences 2002 57

2 An international forum for the expression of ideas and opinions pertaining to the submarine telecom industry Exordium

Submarine Telecoms Forum is published quarterly by WFN Strategies, L.L.C. The publication may not be I never could sprint much. reproduced or transmitted in any form, in whole or in part, without the permission of the publishers. Liability: Truth be known, I didn’t start running until I while every care is taken in preparation of this was well into my 30s, and before that I was a publication, the publishers cannot be held responsible swimmer. But even in the water I preferred the for the accuracy of the information herein, or any errors longer race to the short, choosing instead to which may occur in advertising or editorial content, or bear down, not looking ahead for the end. any consequence arising from any errors or omissions. Submarine Telecoms Forum is an independent I suppose that’s still true today. commercial publication, serving as a freely accessible When I look at this incredible, changing market, I choose not as forum for professionals in industries connected with some suggest, “to cry in my beer.” Instead I plan to bear down submarine optical fibre technologies and techniques. The and finish the race – not in a single short burst, but in a slow, publisher cannot be held responsible for any views pedantic, purposeful way. This is after all a marathon of sorts. expressed by contributors, and the editor reserves the right to edit any advertising or editorial material I suspect those of us who are experiencing not our first, but submitted for publication. second or third such slowdown, know that there will be indeed an © WFN Strategies L.L.C., 2002 end in sight – and we’ll keep from the temptation of others to Contributions are welcomed and should be forwarded jump from that ledge. to the Managing Editor: Wayne F. Nielsen, WFN Strategies, And when it’s time, we’ll bother to look up. 115 Environs Road, Sterling, Virginia 20165, USA. Tel: +1 (703) 444-2527, Fax:+1 (703) 444-3047. Email: [email protected]. Wayne F. Nielsen Advertising enquiries: Publisher Email: [email protected]. Designed and produced by Ted Breeze BJ Marketing Communications, Colchester, UK..

3 Nice publication, especially for the Congrats and thank you. A very good- Emails to first version, congratulations. looking book. Looks like a metric ton of work. John Warta President & CEO, NextNet Ventures Regards,

Ján Vlcek

○○○○○○○○○○ the Editor ○○○○○○○○○○○○○○○○○○○○○ President of Variant Inc.

I just read the premiere issue of ○○○○○○○○○ Congratulations for the 1st ○○○○○○○○○○○○○○○○○○○○○○ edition. Excellent! subtelforum and I want to congratulate you for a very well done and Jean Devos informative webzine. My staff and Brilliant, the industry really needs President AXIOM/AXONE myself will be waiting for the next this. Member of Don Quixote association issue.

Steven Wells

○○○○○○○○○ ○○○○○○○○○○○○○○○○○○○○○○ John W. Graham PricewaterhouseCoopers Executive Vice President,

Sales and Marketing,

○○○○○○○○○ Thank for notifying us of your new ○○○○○○○○○○○○○○○○○○○○○○ magazine, which has been well received International Telecom Group

by those of us involved on cable ○○○○○○○○○○ projects in Fugro. ○○○○○○○○○○○○○○○○○○○○○ Thank you very much for issuing to As the main commercial contact me the first publication of the point for cable surveys in Fugro Greatly enjoyed this first edition - Submarine Telecoms Forum. Survey can I request to be included hope to see many more I believe our industry will in your notification notice for next benefit from your initiative and wish quarter’s publication. Regards you all the best and continued success Tony Trapp, with your new online magazine. Thanks and best regards, Managing Director Eric Robertson, Fugro The Engineering Business Best Regards

Steve Silvano

○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○○

○○○○○○○○○○ ○○○○○○○○○○○○○○○○○○○○○ Vice-President, IT International Telecom

Very nice work with the Sub Tel I received a copy of this publication ○○○○○○○○○ Forum!! To the point, authoritative, today. Thank you - this is a great ○○○○○○○○○○○○○○○○○○○○○○ and timely. way to stay informed and is long overdue. I’m looking forward to the Nice magazine and web site - all very Stephen P. Miller next publication. professional. My congratulations. Head, Geological Data Center Scripps Institution of Oceanography, Best regards, Chuck Chamberlain, Esq. UCSD Adien Agenbach

44 network maintenance sponsored by

Malta state-owned energy provider Enemalta stated recently it would sue the owners of the Tonga-registered, 85-metre vessel Marwa M, Call for Papers which damaged one of two 33kV submarine Global Marine Systems Ltd will be hosting the next Plenary meeting of the power cables which supply power to the island of Gozo, three miles north of Malta. International Cable Protection Committee (ICPC) The 9,000-tonne cargo vessel damaged Florida, USA, 4-6 June inclusive. the cable when it anchored between Malta and All of the World’s major telecommunications companies are represented within this prestigious Gozo, apparently to shelter from bad weather. organisation whose principal purpose is to promote the safeguarding of submarine cables Enemalta said that according to investigations against man-made and natural hazards. it would not be possible to repair the $2.3 million The Executive Committee (EC) seeks presentations by interested parties that would cable, laid in 1981. primarilyaddress the following topics: Markers in the area forbid vessels from anchoring, due to the cables. • Environment • Fishing Liaison / Cable Awareness • Marine Technology The damage to the cable caused It is envisaged that around four presentations will be accepted for each topic category. Papers which thousands of people in Gozo to be without address other relevant areas of submarine cable business may also be considered. Prospective presenters are respectfully advised that papers which are overtly marketing a product or service will not be accepted. electricity between Sunday and Monday morning. Power is now being provided through NB: Commercial exhibits may be displayed near the ICPC meeting room by special arrangement. Please contact the Secretary for further details. the second cable. Presentations should be 25 minutes long including time for questions. The EC will evaluate all submissions The vessel has been held in Malta and is based on content and quality. Abstracts should be sent for the attention of the ICPC Secretary via being guarded by a Maltese armed forces patrol e-mail or fax no later than 29 March 2002. E-mail: [email protected] FAX: +44 870 052 6049 boat one mile off Valletta harbour.

5 network maintenance sponsored by

CTC has been awarded a contract to supply two- Teesside University and will serve the two-fold company aims to be the industry pioneer of cable maintenance ROVs to NSCMA (North Sea purpose of providing much needed training for improved cable system security while having a Cable Maintenance Agreement). The 300kW offshore personnel through real-time simulations significant market share in cable installation, vehicles will have a burial depth of 1.5m and of live operations and being a tool by which to protection and maintenance operations the capability to launch and recover in seastate analyse, and consequently reduce, problems worldwide. 6. The ROVs are currently being built at SMD experienced during offshore operations. and will be mobilised to Maersk Defender and The entire subsea cable industry currently Peter Faber by April 2002. suffers significant financial losses through CTC Marine Projects is a leading subsea inadequate training with many new crews being telecommunications cable installation and trained ‘on the job’. CTC’s Simulator will train maintenance contractor based in Darlington. crews, both internal and external, to a high The company is a subsidiary of Alcatel, the standard and improve the productivity of worlds largest supplier of undersea fibreoptic offshore operations industry wide. cable systems. This project is the first of its kind in the In addition to installation and maintenance world and is likely to attract considerable interest services, CTC is currently developing an ROV throughout the industry when it is completed in and Cable Laying Fault Analysis and Training mid 2002. Simulator which will be based in the company’s Enhanced cable protection remains the office in Darlington. This unique virtual reality principal focus of CTC and through the centre is being developed in conjunction with introduction of state of the art equipment the

6 sub tech

Alcatel recently announced that it has achieved An extraordinary step in the bandwidth race, control on soft ground the plough is suitable for use another world record in submarine optical the Vascade R1000 fiber solution utilizes dispersion- in operations up to a water depth of 1500 meters. transmission by transporting 3.65Tbit/s capacity over management fiber technology for undersea All functions from trench depth to final trench 6,850km on a single fiber; or 365 wavelengths, each systems. Dispersion management is achieved by recovery are monitored using state of the art sensors operating at 10Gbit/s over a distance equivalent to combining one fiber with positive dispersion and throughout the entire package. most transatlantic cable links. Alcatel’s breakthrough positive slope, Corning Vascade L1000 fiber, with a As mentioned, the depth of the trench is held would enable the simultaneous throughput of 45 second fiber with negative dispersion and negative to within 50-mm nominal. Sensors measure how the million voice calls, 552 CD-Roms, 35 Encyclopedia slope, Corning Vascade S1000 fiber. cable is being deployed: its tension and speed. In Britannicas, or 16 high definition movies over a The result is an integrated fiber solution that addition to these sensors there is an array of visual single optical fiber across the Atlantic Ocean. creates synergy by combining a high effective area surveillance queues provided by B&W and color fiber, which handles more power, with a CCD cameras with a compliment of lighting to show complementary fiber design to achieve managed the operator and client how well the equipment is dispersion with a nearly flat dispersion slope. holding to required specifications

Corning Incorporated recently introduced a new undersea optical fiber optimized for transoceanic networks. The Corning(R) Vascade(TM) R1000 fiber solution is an advanced dispersion-managed fiber solution for transoceanic systems. Smit-Oceaneering Cable Systems (SOCS) The Vascade R1000 fiber solution enables the announces the successful completion of the Factory use of more channels, a wider bandwidth spectrum Acceptance Tests of their new MD3-JK Cable Burial and longer system reach than can be achieved Plough. This subsea plough is capable of burying through other submarine fibers. Corning purports 17 mm to 150-mm cable and repeaters up to 350 that this is the first commercial fiber solution to mm in a trench depth of up to 3.0 meters. enable utilization of the entire C-band, making it The plough’s cutting depth can be constantly possible to cross the Atlantic or the Pacific oceans varied between 0.15 meters and 2.0 meters. at 10 Gb/s without signal regeneration. Higher power Ploughing deeper than the 2.0 meter depth is and managed dispersion also provide a clearly achieved by plough sinkage. In normal conditions visible upgrade path to higher data rates and channel this plough has a depth accuracy of better than 50 counts for undersea networks. mm. With stabilizers at the rear that assist with depth SOCS MD3-JK plough

7 sub tell

The Pacific Telecommunications Council (PTC) an- FLAG Telecom, a leading global network services and bringing the former TyCom organization back nounced today that Minister Wu Jichuan of China’s provider and independent carriers’ carrier, recently under the Tyco umbrella as a wholly owned Ministry of Information Industry (MII) has con- announced that it has appointed Mr. Michel subsidiary. firmed his participation at its 24th annual interna- Cayouette as Chief Financial Officer. As part of this restructuring change, its website tional conference, PTC2002, as a keynote speaker Mr. Cayouette brings an extensive background name has changed to www.tycotelecom.com, while on Monday, 14 January 2002. in global telecommunications and finance, most its e-mail domain now contains the extension Minister Wu will lead a delegation of seven recently as the Executive Vice President and Chief @tycotelecom.com. other Chinese officials to Hawaii. He will proceed to Financial Officer of TIW Asia N.V., a global Washington, DC after PTC2002 for bilateral meet- communications investment fund, and Vice ings with U.S. Government officials. President and General Manager, Pacific Rim and Ailing wholesale telecommunications carrier Global As the gatekeeper to China’s cyberspace, Wu Chief Financial Officer of Teleglobe Communications Crossing Ltd. said recently it obtained a waiver from has pressed hard to make the Internet more acces- Corporation. its lenders forpotential violations of a credit sible to ordinary Chinese (among his achievements: “I am pleased to join the highly talented agreement covering $2.25 billion in borrowing. forcing state-backed China Telecom to cut prices). management team at FLAG Telecom,” commented Global Crossing said it will continue In the past 20 years, China has achieved leap- Mr. Cayouette. “I see a real opportunity for FLAG discussions with its creditors, led by J.P. Morgan frog development in the infocomm sector by seizing Telecom to weather the current economic conditions Chase & Co. and Citibank, a unit of Citigroup Inc. , the opportunities brought about by the IT techno- and continue to carve out a leadership position by about the terms of its credit agreement as the logical evolution and global information network de- providing a high level of service to its diverse carrier company pursues discussions with potential equity velopment and formulating correct policies. base and serving areas of the world where the investors. Industry experts estimate that by the end of company has a first-mover advantage.” The waiver is effective through Feb. 13, 2002 2001, China will have a total of 300 million telephone Mr. Cayouette will begin his tenure in January and requires Global Crossing to maintain certain subscribers (fixed: 170 million and mobile: 130 mil- 2002 when he will replace Peter O’Donoghue who cash balances, the company said. In November, lion) with over 25% telephone penetration rate and is FLAG Telecom’s acting Chief Financial Officer. Global Crossing said that it was in talks with banks over 10% mobile penetration rate. to amend the covenants on the debt. The international gateway bandwidth for In November, the company posted a third- Internet will basically meet the demands of various TyCom’s name has been changed to Tyco quarter loss of $3.4 billion, or $3.84 per share, applications. There will be more than 30 million Telecommunications, reflecting the buyback of all compared with a $602.4 million loss, or 69 cents Internet users. outstanding TyCom shares by Tyco International, per share, in the year-earlier period.

8 ventures

French telecoms equipment maker Alcatel said the years 2002 through 2004. The purchase price It will also provide Cable & Wireless (WI) Ltd. recently the group should post an operating profit from $66 million $74 million is four to five times with global connectivity and traffic expansion next year despite the crisis in the industry as it cuts expected Canyon EBITDA. Canyon Offshore between major cities in the Eastern Caribbean costs to bring down its breakeven point. currently owns 18 ROV systems and operates six islands, San Juan, Puerto Rico and the United Alcatel Chairman Serge Tchuruk told an others in three regions. States. analysts’ meeting recently that even if sales were The company entered the cable burial industry to decline as much as 20 percent from 2001, the in September 2000 and presently operates eight Phoenix International, Inc. recently announced its group should still break even at the operating level. trenching systems internationally, including four relocation to a new facility. Expanding government Alcatel said in October that it faces a net loss customer-owned units. The average age of the and commercial business necessitated a move into of five billion euros for 2001 and an operating loss Canyon ROV fleet is approximately two years. a modern 40,000 sq. ft. tech-flex office / warehouse of around 100-200 million. complex located in Landover, Maryland. The site is 8 miles from downtown Washington, D.C. and in The final splice of Phase 2 of the MedNautilus proximity to Andrews Air Force Base and several Singapore-owned submarine carrier, C2C, has project took place recently, linking Catania and Tel international airports. activated capacity on its pan-Asian network. The Aviv. The marine installation for the Eastern The move results in the consolidation of 17,000km long network will eventually connect Mediterranean ring is now finalised. Phoenix’s management and administration office China, Hong Kong, Japan, Korea, Philippines, with its Deep Ocean Operations support facility. The Singapore and Taiwan. The company will also deliver new spaces are of sufficient size to house the the trans-Pacific network between Japan and the New World Network, Ltd., the principal owner of company’s commercial undersea search and US, connecting C2C’s customers from Asia to North the Americas Region Caribbean Optical-ring System recovery systems as well as the U.S. Navy’s America. The Japan-US route will be ready by the (ARCOS), and Cable & Wireless (WI) Ltd. a top-tier substantial inventory of similar equipment. second quarter of the year. global telecommunications provider, recently Phoenix holds the Navy’s multi-year Undersea announced that Cable & Wireless (WI) Ltd. has Operations contract by which it operates and acquired capacity on the ARCOS cable system. maintains the Nation’s most comprehensive and Cal Dive International, Inc. recently announced This newly acquired capacity will extend Cable sophisticated capabilities in underwater search and that it has agreed to acquire 85% of Canyon & Wireless’ (WI) international fiber network footprint recovery to water depths of 6,000 meters. Offshore, Inc., a supplier of ROVs and robotics to further into the Caribbean. New World Network will The new facility complements a 6-acre water- the offshore construction and telecom industries. Cal provide Cable & Wireless (WI) Ltd. with a multi- level, front property in Morgan City, Louisiana, the Dive would purchase the remaining 15% at a price high capacity Synchronous Transport Module (STM) company’s center for its diving, underwater welding, to be determined by Canyon’s performance during on its ARCOS fiber-optic cable network. and inwater ship repair capabilities.

9 ventures vessels

Fujitsu Australia announced today that it has se- Nullarbor Plains demands,” ABB’s General Manager, On Saturday 20th October 2001 at 11.00am the lected two suppliers, ABB Australia and Downer Mr Roy Rowe said. cable layer ‘Pertinacia’ was launched from the Engineering, for the works associated with the Nava- Downer Engineering CEO, Mr Chris Denney, Morosini slipway at the Cantiere Navale Fratelli 1 terrestrial fibre-optic cable system from Perth to said “Downer Engineering is delighted to be asso- Orlando in Livorno. This high-tech vessel was Melbourne via Adelaide. ciated with Fujitsu and Nava Networks on the Nava commissioned by the Elettra Tlc S.p.A. of the Nava Networks recently awarded Fujitsu the -1 terrestrial fibre link. We were able to propose a Gruppo Telecom Italia for the laying and repairing role of prime contractor for the implementation of number of route alternatives which offered Nava-1 of underwater cables. the Nava-1 network, a high capacity DWDM optical advantages, including diversity, over current and pre- She has a dead weight of 10,000T, o.a. length system that will link Singapore – Jakarta – Perth viously installed fibre links.” of 129.9m, a width of 23.4m and is 12m in height. using submarine cable and Perth – Adelaide – Mel- The vessel has a maximum speed of 14 knots and The construction for the 3,700-km terrestrial bourne – Sydney using terrestrial cable. is equipped with a helideck. route will commence late January 2002. The ready ABB will perform the works for the link from ‘Pertinacia’ has sophisticated systems for the for service date is scheduled for 1st quarter 2003. Port Augusta to Kalgoorlie, while Downer Engineer- laying, retrieval and repair of underwater optic-fibre ing will perform the works from Perth to Kalgoorlie cables; a submarine plough which can make troughs and Melbourne to Port Augusta via Adelaide. As of up to 1.5m on the sea-bed to a depth of 1, 500 prime contractor for the Nava-1 network, Fujitsu will metres, a 35T A-frame crane for the lowering and manage the integration of an existing PowerTel net- International Subsea & Telecom Services (ISTS) recovery of the submarine plough, 40T cable laying work for the Melbourne – Sydney segment. has announced its entry into the submarine cable drums for the laying and retrieval of underwater optic ABB and Downer Engineering have already market with the opening of an office in Vancouver, fibre cable, linear cable engines that can lay up to commenced the route design, selection and nego- Canada. 200 km of cable a day. Two cable storage tanks tiations for the right of way, which will be followed ISTS President Adien Aggenbach says the with a capacity of 6,000T (8,000km) capable of by path excavation and then laying the optical fibre. company is viewing the depression as an opportunity laying a line across in the Atlantic in a single ABB and Downer will use leading-edge technology to fine-tune the services of the company to an operation. to implement the terrestrial route across some of evolving industry and to adapt accordingly. “The The vessel is being built under the watchful the harshest conditions in the country, including the recent downturn in the cable industry has given us eyes of the R.I.Na (Registro Italiano Navale) and Nullarbor Plains. the opportunity to procure the best marine and the ABS (American Bureau of Ships) to ensure she “With an extensive workforce throughout Aus- terrestrial consultants in the industry and position meets the most stringent standards and international tralia and widespread experience with telecommu- ourselves favorably for the inevitable turnaround in requirements and will be a great asset to the fleet nications projects, ABB is well placed to deal with the market.” flying the Italian flag. The vessel’s delivery is the challenges an infrastructure build across the Please visit www www.ists.info.ists.info. scheduled for March 2002.

10 SEARCHING OR A LIGHT IN THE OG Is there a future for the troubled submarine cable industry?

Although the three-year period leading Effects of an Economic Slowdown up to 2002 saw the highest levels of on the Undersea Cable Markets investment in undersea cable systems The industry will indeed be negatively ever, 2001 proved to be a major influenced by the current economic disappointment for the industry, and was recession. The undersea industry is marked by massive layoffs, downsizing, presently and will continue to experience devaluation, and bankruptcy. a slowdown in investment and spending, Consequently, the undersea cable but as of late-2001, this slowdown had industry enters 2002 with bated breath already entered its fourth quarter (no major and low expectations. supply contracts have been signed since There is a widespread belief that the January of 2001, when Cable and Wireless undersea cable market will be significantly commissioned Alcatel to build its Apollo affected by the current economic system). Historically, there have been only downturn. Many in the industry also three contractions in the undersea fiber suspect that the capital required for major optic cable market. None of these undersea projects has dried up, at least contractions lasted longer than six quarters. temporarily. And the undersea industry has Based on cable activation dates, the been particularly disheartened by the view first contraction in undersea investment that it suffers from an enormous oversupply occurred in 1989 when it was off by five of capacity, and that this oversupply will percent; the second occurred in 1995, when prevent any significant deployment in the the market contracted by 15 percent; and by Michael Ruddy near-future. the third took place in 1997, when

11 investment dropped by 16 percent (these development schedule for undersea systems undersea cable developers will not be as dates can be moved back by two to three from project conception to system severe as many industry observers expect. years to represent the date at which the activation), investment increased 168 Admittedly, the present recession may cable systems were conceived). percent during the first recession and be somewhat different because of the The undersea industry has always been increased 3 percent during the second. undersea industry’s newfound reliance on cyclical, and because the undersea industry An analysis of the undersea cable capital markets to fund investor-led experienced its highest levels of investment market’s performance during these two systems. However, historical analysis, as in the last few years, investment will recessions gives insight into the correlation discussed above, shows that the industry inevitably slow. However, there is little not only between economic growth and has been able to increase investment levels empirical evidence to show a clear-cut investment in undersea cables, but also the even in times of economic recession. And, correlation between undersea cable correlation between economic growth and if necessary, the undersea communications investment and economic growth. For this carrier spending on international undersea market is able to redefine itself in terms of reason, Terabit believes that the current capacity. investment sources. contraction in undersea investment is only This is because from 1988 to 1998, Historically, the undersea cable indus- moderately influenced by economic undersea cable investment was, for all try has been driven by factors that are only recession. intents and purposes, equal to carrier moderately influenced by worldwide During the era of the fiber optic spending on undersea systems, since almost economic conditions. It is recognition of undersea cable, the greatest recessions in all systems were constructed by carriers.1 these factors’ importance that will allow the the growth of the worldwide economy As a result, the impact of economic reces- industry to be resilient in the present occurred from 1988 to 1991 and from 1997 sion on both undersea cable suppliers and recession. Therefore, it is important for the to 1998. During these two economic industry to isolate and examine the factors 1 Only in 1998 was there any significant deployment slowdowns, annual investment in undersea of non-consortium cables. However, reinforcing the that drive undersea cable demand, rather cable systems by ready-for-service date argument that carrier spending on undersea capacity than to accept forecasted economic growth increased by 161 percent and decreased by during the period from 1988 to 1997 was equal to or as an indicator of the undersea cable 44 percent, respectively. greater than overall undersea investment, carriers industry’s future. spent almost $2 billion on undersea capacity in the When investment is classified These factors include trends in the only major non-carrier system, Atlantic Crossing-1. according to the estimated date of project This was more than double the investment in the overall demand for capacity within the conception (assuming a two- to three-year system. Internet industry (including application

12 development), new technological phenomena sparking demand for Forecast of Worldwide Undersea Cable Investment by bandwidth, network architecture within the Ready-for-Service Date, 2001-2010 local loop, and the propensity of and $14.0 incentives for new cable operators to enter an undersea market even when design $12.0 capacity of existing systems has not been $10.0 Upgrade s exhausted. $8.0

Sources of Capital for Undersea $6.0 New Cable Projects ($Billions) $4.0 Systems One of the negative effects of the undersea $2.0 communications market’s shift from $0.0 consortium-led systems to investor-led systems has been the industry’s newfound reliance upon capital markets, specifically 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 speculative investors. Until 1998, almost all undersea systems were financed by blue- The market environment shifted the seemingly infinite sources of capital chip companies such as AT&T, KDD, BT, dramatically in 1998 when Global Crossing that were waiting to be funneled into France Telecom, and Deutsche Telekom, assumed the risk of developing a undersea projects. which often financed the projects using transatlantic system and reaped huge Beginning in 2000, investors and their own internal capital. In some special rewards. The returns that were attained by financiers have been reluctant to lend to cases, the carriers sought financing from the small group of financial institutions or invest in telecommunications financial institutions; however, these that had invested in Global Crossing infrastructure projects. Because of the institutions had little doubt as to the inspired countless other financial devaluation or bankruptcy of undersea financial viability of the carrier or the merit institutions to stake their capital on the specialist companies such as Global of the carrier’s decision to invest in an undersea market. New entrants to the Crossing, 360networks, Level 3, and FLAG, undersea project. undersea market abounded, drawing upon many investors have sensed that the

13 undersea communications industry was undersea capacity market, the undersea to justify their construction based on the particularly overvalued, and as a result they cable industry will still be able to reemerge, demand generated by the carrier’s are likely to shun the market until provided that overall capacity demand proprietary (non-wholesale) traffic alone. indications emerge to convince them merits it. If the market gives rise to a However, the systems will still be IRU-based. otherwise. scenario in which the IRU and lease-type A cable constructed in this mold may only The indications for financial undersea capacity market is weak but the need to justify itself based on the premise institutions and private investors to return demand for capacity is strong, then the that the carrier participants will fill 30 or to the undersea market will be those that market will become the domain of 40 percent of the system’s capacity (or even show a strong undersea capacity market. established operators that are able to tap less). The carrier participants will then seek Based on its highly-granular forecasts of traditional sources of capital. In this to market the system’s remaining capacity demand, pricing, and competition, Terabit respect, the undersea industry will have on the IRU or lease market. believes that the undersea IRU and lease- returned to its carrier roots. However, there Terabit believes that the future type capacity market will return to its is strong evidence to suggest that the undersea market will be a combination of historical high by the end of 2002. industry will not necessarily return to the both investor-led and carrier-led projects. Financiers and investors may be reluctant consortium model that dominated the It is likely that the carrier-led projects will to lend to or invest in undersea projects undersea fiber optic industry for the first be organized by either single carriers or very until the recovery has actually been proven. ten years of its existence. small groups of carriers, rather than As a result, Terabit believes that at least a If investor-led systems fail to achieve consortia. few investor-led systems will enter the financing, the most likely model to emerge The proportions of carrier-led and market beginning in 2003. will be hybrid-type systems which are led investor-led projects will be determined by Even if financial institutions and by one to three carriers. The carriers willing the willingness of the investment private investors sense a weakness in the to invest in these systems will be required community to underwrite investor-led projects. Terabit asserts that at least some 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 in the investment community will begin to Investment in New Undersea assemble the courage to reenter the Systems ($Billions) $12.3 $3.9 $1.4 $5.6 $9.7 $7.1 $5.6 $6.5 $6.9 $8.1 undersea communications market once the Investments in Undersea System consistent robustness of the IRU capacity Upgrades ($Billions) $0.1 $0.1 $0.5 $1.1 $1.2 $1.6 $1.4 $1.2 $1.6 $1.9 market is proven in late-2002.

14 The Perceived Oversupply of logic is to be believed, Terabit’s own analysis Undersea Capacity shows that the design capacity of existing Michael Ruddy is the managing director of Terabit Consulting, based in Cambridge, Perhaps the biggest threat facing the and awarded systems will not be saturated Massachusetts. He is responsible for performing undersea industry is the perception that the until 2006 on the transatlantic route; 2007 customized research for Terabit’s clients, which market is vastly oversupplied with capacity. on the transpacific, North America-South include cable suppliers, cable developers, For the most part, this perception was the America, and east Asian regional routes; and carriers, component manufacturers, industry result of grandiose statements on the part 2008 on the Australian intercontinental organizations, financiers, and governmental agencies. of cable developers as to the capacity of route; thus, there would be no deployment Mr. Ruddy joined Terabit in 2000. Prior to their systems. On transoceanic routes, along these routes until those dates. Terabit, he was the senior fiber optics analyst cable developers touted their cables as However, Terabit asserts that the for Pioneer Consulting, specializing in undersea “terabit systems” when in fact the systems’ likelihood of this scenario coming to cable market analysis. Mr. Ruddy was initial capacities were typically only 160 fruition is virtually zero. The decisions of responsible for building up Pioneer’s submarine market research business. He did so with the Gbps. In order to achieve the design developers to construct IRU-based undersea creation of Pioneer’s annual report, Worldwide capacities of their systems, cable developers cables will be based on the size and growth Submarine Fiber Optic Systems, which featured typically must invest anywhere from 30 to of the undersea capacity market. The the first demand-based model of undersea cable 60 percent more capital than they had decisions of carriers to develop carrier-led deployment. At Pioneer, Mr. Ruddy also invested to achieve the initial capacities of cables will be based on their own internal authored the feasibility studies for more than a half-dozen leading systems. These studies were their systems. requirements, as well as a comparison of used to secure several billion dollars of financing Nevertheless, many investors and unit development costs with the unit price for undersea cable projects. industry observers have focused on the of capacity on existing cables. supply capacity of systems as precluding the Future deployment will be driven not construction of any systems in the near- only by the increasing size of the undersea cable systems will be a leading incentive for future. Using the assumption that no new capacity markets and carriers’ own future deployment. In fact, this analysis systems will be needed until the design burgeoning requirements for capacity, but shows that most cable systems will be capacity of existing systems is fully by the continuous decrease in the costs of rendered economically uncompetitive consumed, these observers assert that no constructing capacity. before they can upgrade to full capacity, new deployment will occur for as many as Terabit’s analysis shows that the rendering the argument surrounding the ten years into the future. Indeed, if this declining unit cost of constructing undersea “capacity glut” irrelevant.

15 Because of the declining cost curve for constructing undersea cables, future cables will have a significant cost advantage over their predecessors. The unit cost of constructing systems at their initial capacity levels has fallen at an average yearly rate THE GLOBAL MARINE 39 percent along transoceanic routes. The TELECOMMUNICATIONS MARKET unit cost of upgrading systems has fallen at an average annual rate of 46 percent. A Market Study Covering The Latest Developments And Opportunities Given the steep erosion in unit costs, TMS International is pleased to announce the release of its latest market study - The Global Marine undersea systems will quickly become less Telecommunications Market. The report has been commissioned by TMSI and compiled by industry and less competitive vis-à-vis newer experts from published information, reports from industry consulting and research organizations systems. Further, systems will eventually and from interviews with key players in the telecommunications industry particularly from the latest Submarine Telecommunications Conference. reach a point at which their unit cost of upgrading capacity will exceed the cost of The Report reviews the current market situation, and includes comment and analysis on building a new system and equipping it to Cable Systems, Routes and Landings an initial capacity level (one-tenth to one- System Planning, Investment and Implementation fourth of design capacity). Trends in Production, Supply and Demand On average, once an undersea system The Repeatered and Unrepeatered Sectors has been in service for six years, the unit New Systems are being planned now for installation in 2003/2004 –Make sure you are aware cost of upgrading that system will exceed of these opportunities the unit cost of deploying a new, initially- The Global Telecommunications Market Report is available on CD direct from TMSI at equipped system. However, in times of US$1175 per copy. technological advancement, such as the adoption of wavelength division multiplexing, the unit cost of building new You can order your copy directly from the TMSI Web site at http://www.tmsico.com/cablereport systems has eroded at a rate as high as 65 percent; when the rate of cost erosion rises

16 to such levels, the upgrading of systems can of its initial capacity. However, the operator many ways, the industry already has be rendered economically detrimental typically expects to offset these lower become unhealthily pessimistic, with within two years (that is, in such cases, it margins with the higher margins that it will suppliers reducing their supply capacities would be cheaper to construct a new system receive by selling its lower-cost upgrade (as was the case of Alcatel’s closure of its than to continue upgrading the old system). capacity. Cable operators with upgrade Portland, Oregon cable plant) and laying Depending on the rate of capacity have occasionally exerted off thousands of workers. In an attempt to technological advancement, systems will be downward price pressure on the markets, appease Wall Street analysts and able to upgrade their capacity for as few as but rarely if ever have they engaged in demonstrate immediate returns, cable three or as many as six years. Terabit’s practices which could be considered operators have also laid off thousands of demand forecasts show that within six “dumping.” workers. years, systems will likely only be able to Further, perhaps more importantly, if Conversely, once the market begins to upgrade to between one-third and one-half cable operators with upgrade capacity do recover, its participants must ensure that of their design capacities, because of the decide to sell capacity at depressed prices, they do not fall prey to the speculation, additional systems that they will be then cable developers can easily price down greed, and lack of planning that led to competing against. the unit costs of their initially-equipped market collapse in the first place. Given the fact that undersea cables systems by increasing the initial capacity Terabit’s forecasts show that there will could possibly under-price any future of their systems, or by retreating to the be adequate levels of capacity demand to competition for as many as six years, it is original dynamics of the undersea capacity support a robust undersea capacity market reasonable to ask how newer cable systems market, whereby carriers accepted lower and significant increases in undersea cable will be able to compete. The answer lies in margins on their initial capacity with the investment. the dynamics of the capacity markets. The expectation that they would receive higher Admittedly, the market will not return undersea capacity markets are subjected to margins on their upgrade capacities. to its historical levels of activity until late- continuous downward price pressure, and 2002. Thereafter, demand and capacity because undersea capacity is for the most Progression of the Industry sales will be able to support greater part a commodity, operators are forced to In the future, it is of primary importance deployment of cable and greater investment accept the market price. that the undersea industry not fall victim levels than it ever had in the past: Terabit Typically, the cable operator is forced to the pessimism that has pervaded the forecasts that investment in undersea to accept a relatively low margin on the sale entire telecommunications industry. In systems during the six years from 2004 to

17 2009 will total $49.6 billion, or $9 billion The industry was ruled by speculation and OFFSHORE SITE INVESTIGATION AND more than the historical investment in the the expectation of quick, painless returns. GEOTECHNICS 14 years from 1988 to 2001. The end result was chaos. By the time the The fact of the matter is that the dust had settled on the marketplace in “SUSTAINABILITY undersea industry has never truly 2001, almost all the decisions of industry THROUGH DIVERSITY” experienced sustained success; compared to participants had uniformly resulted in recent times, the industry’s growth from major losses, or in some cases, bankruptcy. International Conference 26, 27 & 28 November 2002, London 1988 to 1997 was restrained and controlled. Although many thousands of jobs and Its customer base was a known and many billions of dollars were lost, Terabit Call for Papers unchanging entity: the consortia. believes that the events of 2000 and 2001 Effectively, the industry was thrown into will have served to lay the foundation for Aims of theConference chaos by the introduction of unknown the rebirth of the industry. The industry This will be the 5th in the landmark customer groups and runaway capacity had become a densely-populated forest international Offshore Site demand, and most of all, by the allure of wherein hundred-year-old elm trees were Investigation Conference series, first high double-digit and sometimes triple- competing for water and nutrients with convened by the SUT in 1979, and the digit returns. It responded with hastily-planted saplings. The industry theme of this one is “Sustainability spontaneous and often contradictory collapse has effectively resulted in a severe through Diversity”. The Conference will present papers encompassing a wide actions that mimicked the performance of forest fire which few have survived. range of geotechnical and geophysical a day-trader of NASDAQ stocks rather than However, a newly-fertile marketplace has subjects under this theme. the decisions of multi-billion-dollar emerged, with a clear view toward upward #or details of topics, contact: corporations. Plans for cable systems were growth. Surviving market participants and Jean Pritchard, no sooner announced than they were new market participants must act swiftly Society for Underwater Technology merged with competitors’ systems, their to demonstrate their commitment to the Innovation Centre, Offshore Technology capacities were increased threefold, or plans market. They can do so by staking out Park, Bridge of Don, Aberdeen, AB23 8GX for the systems were abandoned territory which will provide comfortable e.mail: [email protected] completely. Suppliers quickly rewrote their returns; the mistake of past market #ax: +44 (0) 1224 820236. business plans so that they had become participants may have been the belief that Phone: +44 (0) 1224 823637 cable developers, or investors in systems. they could tap the entire market for profit.

18 Making sense of the market Purchase and sale of channels of bandwidth started well over 100 years ago. Like their technological forebears, fibre-optic cables BANDWIDTH themselves are laid and may be bought and sold and, at the end of their useful lives, they are closed down. The commercial terms for the rights of use of fibre-optic cable capacity rely on methods of sharing capacity which are technologically elegant and unique. A channel of bandwidth allows the user a share in the use of the transmission medium which is distinct from ownership of the cable itself. The State of the Market Two very significant trends have now been operating in the marketplace. The first by Rex Ramsden M.A. (Cantab), F.Inst.D of these is the logarithmic reduction in the unit cost of bandwidth creation. Each new Over the last 18 months my company has we have also handled buying enquiries from generation of fibre-optic submarine cable researched the buying intentions potential purchasers in liberalising markets has a design maximum capacity, far amongst a number of major buyers of such as these and in the already intensely exceeding the previous generation, for capacity in four important segments of competitive markets including US/Europe, roughly the same capital cost. Cables are the bandwidth market – US/Asia, intra intra US and intra Europe. also designed now to have their capacities S.E. Asia, intra Mediterranean and US/S. Added to a previous ten years of doubled or quadrupled two or three times America. experience in the submarine cable laying in their lifetime without changes to the This work was done for clients who business, this gives a good perspective over submerged plant. were investors or potential investors in the lifetime to date of the industry in the The second significant trend has been submarine cables. For the last three years fibre-optic era. the division of this huge growth in

19 bandwidth supply into the hands of many Overbuilding was seen also in the very competitive sellers of transmission terrestrial cable markets of the USA and Rex M. J. Ramsden capacity. The bandwidth market is now a Western Europe. The danger signals from Rex Ramsden has a very aggressive “supply-push” type of all this have now led to reversals in earlier degree in Natural market – a complete reversal from only 10 confidence. Sciences and had a long career in the oil and years ago. gas industry including Bandwidth market segmentation senior management Cable investment decisions Cables on the same geographical route roles in business devel- opment and manage- The business case for the investment in a compete for sales of bandwidth or capacity ment consultancy. He submarine cable is inevitably sensitive to and owners of capacity in the same cables entered the telecommunications industry in 1988 capacity selling prices and sales volumes in compete. Very recently, we have started to on being recruited into BT as a member of the board of its submarine cableship subsidiary BT (Marine) the bandwidth market. There were many see some competition or interaction Ltd and later transferred to the board of C&W Ma- early cases of financial successes when the between geographical separate routes. An rine Ltd on the takeover of the BT subsidiary. timing was right to construct a new fibre- example of this is for bandwidth between optic submarine cable on particular routes. the Middle East and USA – routing In 1997 he embarked upon a new career, setting up Mensard Ltd, his own company, to act as an Actual financial performance exceeded geographically westward now competes intermediary on behalf of companies who use planned performance but sometimes with going eastward around the planet. At Mensard services in their sales and marketing of contained evidence of capacity selling the present state of the market it remains capacity in both submarine and terrestrial fibre-optic networks. The company has about 15 clients in prices falling and volumes growing faster valid to segment the market into essentially several countries and receives capacity purchas- than expected. These successes, perhaps, linear geographical routes. ing enquiries from a customer set of over 200 com- did not serve to emphasise the sensitivities panies world-wide. of the business case but created a wider Capacity pricing confidence which allowed a bout of On very competitive routes, reductions in overbuilding. Geographical segments of the capacity prices have been dramatic. Prices market – one after the other – suffered a on East/West routes across the Atlantic and command a price of less than USD 0.5m as tendency towards overbuilding until the across the Pacific have been reducing by a lump sum acquisition for life of the cable. recent, world-wide application of the brakes over 50% per annum. Today a London/New Four years ago the same unit of capacity on investment. York circuit of STM-1 (155 Mb/s) will would be priced at around USD 7.5m.

20 Whilst annual percentage rates of revenues of capacity selling enterprises are Last mile issues reduction in price are high, the shape of variously reported as static or suffering slow For corporate and other retail customers of the price trajectory over time shows a growth. the major carriers, the service package flattening curve approaching zero price at usually contains items besides the long-haul an ever-decreasing slope. Price volatility has Capacity purchasers’ risks bandwidth. These other items are not not occurred. Achievement of promised delivery dates reducing in cost nor experiencing the same Prices in newly competitive markets and continuity of supply after delivery are intensity of competition as the long-haul have fast approached the prices in slightly great concerns for buyers of bandwidth in bandwidth. Retail prices are therefore older competitive markets. For example, the present market. declining less quickly. This attenuates the prices of capacity on E/W routes across the Buyers need financially secure price elasticity of demand for long-haul Pacific have made a rapid approach towards suppliers. The uncertainties surrounding bandwidth. prices on E/W routes across the Atlantic. those issues outweigh uncertainties about Private owners lay their submarine The pricing process is not well future prices variations. cables into accessible points of presence in understood but appears to be similar to There is a growing preference amongst major cities. In some countries they have pricing behaviour in other technology buyers of bandwidth for shorter lead times set up arrangements for responsive markets such as semi-conductor chips. and for “pay as you go” terms rather than provisioning of last mile circuits extending Comparisons might exist with the up-front lump sum payments. The drivers the long-haul bandwidth to the buildings prices of electronic components if we for this – cash rationing and risk of retail customers. In present times of cash convert these into prices per MHz (for management – are very clear today and processor speeds) and per Gb (for storage). have probably resulted in permanent shifts In those terms the patterns of price in buying policy. reduction have been similar to bandwidth On vital routes, splitting of capacity prices per Gb/s and have continued for requirements into diverse paths and using many years. diverse suppliers is now more common From most perspectives, the most amongst the risk management strategies of competitive bandwidth market segments capacity buying carriers. appear to be over-supplied and newly All these changes transfer risk to cable installed capacity under-utilised. The owners on the supply side of the market.

21 constraint, choices are being made between quarter of 2002. Enquiries for short term volumes in the bandwidth market. Some two lines of focus: purchasing appear to be increasing but from transfers of commercial disciplines into 1. Vertical concentration – which a very low level. These early indicators are telecoms markets have been made from requires invest or partnering with others to showing mainly in the more recently com- outside the telcoms industry. A great deal achieve capillarity at the extremities of the petitive markets. This is probably because more evolution is yet to come. existing long haul pipes. inventories of capacity purchased in the A basic problem remains. The capa- 2. Horizontal concentration – which most competitive routes are still high. bility of fibre-optic technology to supply means continued globalisation to provide Unusually for the industry, there are new cables of enormous capacity results in presence in more and more countries. now cable-owning companies for sale at huge step changes in supply, on the supply Similar choices between vertical and distressed prices. In the markets most side of the industry. The bandwidth market horizontal concentration face the affected by this, the forecasting of capacity has few mature mechanisms for clearing international telcoms companies. As yet supply, demand and future prices hold extra these inventories and fierce price there is no strong signs of a settled pattern uncertainty. Also, particularly amongst the competition seems unavoidable. to the supply chain for transmission more recently built cables, there is huge capacity across the industry. potential to generate further multiples of their present total capacity by the Capacity buying intentions investment in upgrades in land-based Amongst international carriers, intentions equipment. From these sources, the to commit to strategic purchases of capacity industry can expect to enjoy further were, to a great extent, abandoned or shortening of lead times for creating new delayed in 2001. The level of enquiry for capacity within competitive markets. This short term purchasing also fell and it is suggests that the approach towards supply/ ISTS probably true to say that 2001 represented demand balance could be smooth on the International Subsea & Telecom Services 350 east 6th Avenue a trough in capacity purchasing activity. busiest highways of the world. Vancouver, British Columbia Adien Aggenbach Canada V5T 1K1 We know of purchasing intentions Within this whole scenario we can see which have moved into 2002 but these are why purchase and sale activity has not embraced pure trading as a market clearing often conditional on the growth of traffic 1wwwwww.ists.info.ists.info phone mobile fax and hedging mechanism in any significant [email protected] ++ 1.604 ++1.604 ++1.604 demand for the last quarter of 2001 and first 739.2109 802.9333 739.2117

22 1www.ists.info Countdown to Apollo launch . . .

The world’s most advanced transatlantic cable system, Apollo, should be ready for service in 2002.

By Katherine Edwards Apollo Project Director

23 p

In January this year Cable & Wireless, the Apollo Submarine System Network global telecommunications group, announced it would build Apollo, the world’s most advanced transatlantic cable system, to meet growing IP and data demands. Bude Cable & Wireless is using its extensive experience in the engineering, procure- Lannion ment, installation commissioning and Shirley subsequent management of submarine cables to build and operate Apollo. Working Manasquan with Alcatel Submarine Networks, the system supplier, work is well underway to completion by the end of 2002.

The Cable System

Apollo consists of two fully diverse The Apollo Route transatlantic cables running 13,000 km under the Atlantic Ocean linking Long speeds of 10 Gbit/s and has a minimum project implementation and commis- Island and New Jersey in the US with capacity of 80 x 10 Gbit/s. To put this in sioning. A particular area of focus was the Cornwall in the UK and Brittany in France. perspective, each submarine cable leg could resilience and protection of the system. Each of the submarine legs contain 4 support the equivalent of 200 million Apollo is the first transatlantic cable system fibre pairs and is capable of at least 3.2 simultaneous voice calls to use Alcatel’s enhanced cable on both the terabits of traffic on each leg - 25% more European and US continental shelves. capacity existing transatlantic systems. In Built Strength The new design offers a 100% Each fibre pair utilises the latest Cable & Wireless’ Global Operations improvement in crush resistance over technology dense wave division Engineering Services (GOES) staff developed standard single armour and doubled multiplexing (DWDM) transmission at the system design and will be oversee the armoured variants. In addition, a specially

24 designed larger diameter double armour Progress to date - where are we now? cable (special purpose double armour A full route survey and separate burial (SPDA)) will also be used within the system assessment survey has been carried out to and this cable offers a 200% crush resistance obtain the optimum route. Route clearance improvement over the traditional double of out of service cables & other survey armoured variant. identified debris has been completed on The use of the enhancement cable will both the European and US continental assist in Apollo offering greater resilience shelves. System manufacture is progressing in the event of external aggression. to plan with over 90% submarine cable The cable system will be installed using plant either procured or manufactured. the latest plough burial techniques assisting To derisk the marine program and in achieving burial in harder seabed minimise weather downtime periods the substrates. main marine lay has been tailored to match Katherine Edwards is Cable & Wireless’ All this, combined with four diverse the optimum weather conditions in the Apollo Project Director. She has worked for landing stations and separate fully surveyed spring and summer months of 2002. The Cable & Wireless for 12 years and has wide routes, helps to increase significantly the continental shelf operations are planned for experience in both the submarine and cable system’s resilience. early spring 2002 with separate shore satellite project fields. She holds a degree in Electrical and Electronic Engineering and is a Chartered Engineer. France Cable Station – Lannion, Brittany

operations. The United Kingdom shore end was recently successfully installed at Bude, Cornwall. Work on the cable terminal stations is progressing to schedule. European cable stations are nearing completion and the construction has commenced on US sites.

25 In addition the flexible, non-traffic- affecting upgrades on Apollo offer customised growth profiles depending on customers’ traffic requirements.

In Conclusion With the significant amount of submerged plant already manufactured coupled with the clear progress on the civil builds, Apollo is on target for delivery by the end of 2002. In addition, with Cable & Wireless as one of the industry’s most solid, financially stable and established operators building it, customers can feel secure about Apollo’s United Kingdom Cable Station – Bude timely delivery and ongoing operation.

Connectivity Options Right Timing The system will also be connected by We’ve seen a rapid evolution in the dedicated backhaul links to London, Paris transatlantic market and have seen and New York. bandwidth growth in excess of 100% a year. RECRUITING? Of course it need not stop there: onward Despite the current volatile telecoms Get in touch with the right staff by connectivity can be provided through a market, transatlantic traffic growth has still advertising your vacancies in seamless infrastructure throughout US and been robust. As the market adjusts and Submarine Telecoms Forum Europe. Flexible connectivity options are viable hi-tech businesses ride out the storm offered. Network access can be either at the we can expect to see demand rising steadily and reaching all the key people in the submarine telecoms industry. city POPS or carrier neutral hotels, or at the over the coming years. With its ready for [email protected] fibre pair level via dedicated co-location at service date at the end of 2002 Apollo is [email protected] the cable stations. perfectly timed to catch the next IP wave.

26 The submarine cable industry is famous The State of the Industry for its peaks and valleys and nowhere is that seen more clearly than in the deployment of submarine fiber systems in Latin America and the Caribbean. Since the beginning of the fiber era, there has been three clear “boom” periods in submarine cable building in this region, each coinciding with the introduction of THE AMERICAS new transmission technologies. In between are the “droughts,” where the few systems global network. These systems used 140- Caribbean Fibre System (ECFS). The ECFS that are installed tend to be small in scope Mbps technology – the standard of the day. was an interesting system in many respects. – domestic networks or short links between The next boom period began in 1994. Built by a consortium led by Cable & islands. We have just left a boom period in This included the introduction of 560-Mbps Wireless and other carriers serving the small Latin America and the Caribbean and are systems as well as the newer Synchronous islands of the eastern Caribbean, the ECFS facing one of these droughts in 2002. Digital Hierarchy (SDH) technology. replaced a microwave system that had been The first boom in fiber optic Americas-1 and Columbus-2 were the most the only link between the islands. A series submarine systems in Latin America and the significant of these systems. Americas-1 of devastating storms in that hurricane- Caribbean came in 1990. In this year the provided a north-south system linking prone region demonstrated the vul- first large-scale fiber system for the Florida, the U.S. Virgin Islands, Trinidad, nerability of microwave towers, leading to Caribbean entered service – Trans- Venezuela and Brazil. Columbus-2 was the interest in submarine cables. Ironically, one Caribbean System-1 (TCS-1). This 4,500- first transatlantic fiber system to take a of the C&W cable ships installing the ECFS kilometer cable linked Puerto Rico, the “southern” route directly from Mexico, had to deal with another kind of natural Dominican Republic, Jamaica and Florida and the U.S. Virgin Islands to Spain, disaster – it participated in rescue efforts Colombia. In that same year, two other key Portugal and Italy. when the volcano on Montserrat erupted. systems – Florico-2 and CARAC linked the The following year saw other major The last boom period began in the late Caribbean to the US and to transatlantic systems enter service, including Unisur 1990s and ended in 2001. This period saw cable systems, thus improving access to the (Brazil-Argentina-Uruguay) and the Eastern an unprecedented wave of construction as

27 well as the introduction of dense Brazil. Similar in scope to one built by As TSA’s Director of Information wavelength division multiplexing (DWDM) Embratel in the 1990s, Aquatica will take Services, John Manock is technology to Latin America and the advantage of the opening of the Brazilian responsible for creating and Caribbean. It also saw the first com- long-distance market by offering maintaining TSA’s databases on prehensive efforts to link all of South bandwidth, wavelengths and dark fiber to fiberoptic submarine cable systems. America with fiber optic submarine cables. the new players in that market. Aquatica He specializes in the Major systems installed during this will extend 4,600-kilometers and will link development of information services for carriers, period include 360americas, Americas-2, the cities of Forteleza, Natal, Joao Pessoa, developers and suppliers. Mr. Manock has over 12 ARCOS, Atlantis-2, Columbus-3, Emergia, Recife, Maceio, Aracaju, Salvador, Vitoria, years of experience in the fiberoptics and Maya, Panamerican and the Global Cros- Rio de Janeiro, Praia Grande, Pontal do telecommunications consulting business. Before joining TSA, he was employed by KMI sing network – Mid Atlantic Crossing Parana, Florianopolis and Porto Alegre. It Corporation. Mr. Manock participated in the Afrilink, (MAC), Pan American Crossing (PAC) and is planned to be ready for service by the AC-1, HIAM and WH feasibility studies. He also South American Crossing (SAC). These end of 2002. Leading Aquatica is Grupo prepared numerous studies on the competitive local added nearly 100,000 kilometers of sub- Schahin, a Brazilian conglomerate with telecom and long distance markets in the US and marine cable and several terabits of interests in agriculture, construction, on fiberoptic markets in developing parts of the world. potential capacity to a region that probably energy and other industries. A subsidiary had less than 30 gigabits of international of Grupo Schahin, Schahin-Cury, was the privatized company to take over most of submarine cable capacity in total. prime contractor for the first Brazilian the assets and liabilities of Batelco. It also What’s ahead for 2002? With virtually festoon, built for Embratel in the mid-90s. established a licensing regime for every country in the region now connected So where will the opportunities be for telecommunications with provisions to by at least one high-capacity system, the new cable projects in the short term? The enable existing operators to apply for and need for large-scale, regional projects is low Bahamas is an example of how smaller-scale receive new licenses under the new regime. in the short term. The projects that are opportunities to link several particularly The Act created a semi-autonomous being discussed now are modest, mostly fast-growing markets can develop. Public Utilities Commission (PUC), with involving unrepeatered systems. The Telecommunications Act, 1999 responsibility for licensing and regulating The biggest project scheduled for 2002 ended the monopoly of the Bahamas the telecommunications sector. The is Aquatica. This is privately financed Telecommunications Corporation (Batelco), Government of the Bahamas authority will festoon system running down the coast of and provided for the formation of a new, instead be focused on setting broader policy

28 objectives and ensuring that the PUC’s November 2000, Lisa Wells, President of attractive. The Internet and demand for actions are in the national interest, rather BahamasB2B, a business-to-business web television services are driving that growth. than in the day-to-day operations of the site, predicted that, “With the arrival of DSL In the summer of 2001, Jamaica’s telecommunications sector. . . . and with the local cable company telecom regulator, the Office of Utilities Liberalization had an immediate completing work on their fiber optic cable Regulation (OUR), began taking licenses for impact on the submarine cable market in to the US, the pent-up demand for Internet Phase 2 licenses. There are three types of the Bahamas. Cable Bahamas, the country’s usage [in the Bahamas] is going to explode.” Phase 2 licenses — facilities-based carriers, cable television operator, proposed in 2000 Jamaica is another Caribbean market resellers using fixed-line networks and cable to build a system linking several of the that seems to be on a similar course. It is television operators wanting to use their major Bahamian islands to the US. A new in the midst of a three-part program to open existing networks to deliver Internet access. company, Caribbean Crossings, was formed the telecommunications market and end There is no restriction on foreign ownership to build an unrepeatered system to link the C&W Jamaica’s monopoly by 2003. of new carriers in Jamaica. major markets in the Bahamas and the US. Phase 1 was initiated last year when The licensing of international carriers One of the forces driving the demand the government passed a new telecom- is expected in 2002. Winners will be is tourism. Hotels in the Bahamas are major munications law that set the ground rules allowed to begin providing services in users of high-speed services, as is its not for liberalizing the market. Phase 1 also March 2003. insignificant offshore financial industry. saw the introduction of competition in the Meanwhile, no discussion of future Caribbean Crossings’ new system was mobile phone market. Phase 2 will allow potential in Latin America and the named the Bahamas Internet Cable System competition in the domestic fixed-line Caribbean can conclude without men- (BICS). It entered service in summer 2001 market, while Phase 3 will open up the tioning Cuba. linking Florida with the four most populated international market, including the ability With a population of over 11 million islands of the Bahamas – Grand Bahamas, to land submarine cables in Jamaica. and a huge pent-up demand for Internet New Providence, Eleuthera and Abaco. Demand for services in Jamaica is access and telephone service to the United The prospect for inexpensive capacity growing at a rate that makes the opening States, Cuba is highly attractive to carriers led to a flurry of new applications. In of the market in 2003 appear quite and submarine cable developers.

Smit-Oceaneering Cable Systems Visit us at 11911 M529, Houston, Texas 77041, USA PTC 2002, Telephone +1 713 329 4500 ax +1 713 329 4805 29 Hawaii www.socsys.com Booth 312 There have been many efforts to build Cuba was announced in 1999. Quest Net, ago, Internet services were not specifically a fiber optic cable between Cuba and the a Florida-based Internet service provider, prohibited. United States. They have all failed because planned to build a cable to carry Internet Quest Net reported that it had made of political tensions between the two services only. As the cable would not have considerable headway in getting approval countries. Cuba is still under a trade provided phone service, the ISP avoided one for the project, when tensions between the embargo that has been in place for more of the big obstacles that had derailed earlier two countries again flared in early 2000 than 40 years and the United States has not efforts — the US embargo specifically with the Elian Gonzalez affair. Faced with hesitated to pressure other countries against prohibited phone service. new opposition over any ventures in Cuba, trading with Cuba. The issue is much too complex to be particularly among the Cuban population The most recent attempt to build a described in detail here, but in simplified in Florida, Quest Net abandoned the submarine cable system between the US and terms, as there was no Internet forty years project in February of that year. Undersea intelligence on Spain’s Costa del Sol

On 19 - 21 February, Terrapinn will for the l Your best opportunity to meet the Leigh Frame, Director, fifth time organise the Submarine Networks submarine network industry Marketing & Business World EMEA conference on Costa del Sol leaders in 2002. Development, Alcatel Sub- in Spain. Top-level speakers at the three-day marine Networks; Patricia The submarine network industry will conference include: Andy McLeod, Bagnall, President, Africa meet in Costa del Sol to learn,network and Executive VP, Global Operations, Cable & ONE Limited. Andy McLeod share ideas and experiences: Wireless; Donald Kraftson, Managing Sponsors and exhibitors at the l Overcome your biggest challenges: Director, Dolphin Communications; conference include TyCom, Global Marine, financing, cost control, future Edward McCormack, COO, FLAG Telecom; Ericsson and Cable & Wireless. supply and demand l Plan for Atlantic market Check out the agenda on: www.carriersworld.com/submarine_nets_2002/ consolidation and EMEA oppor- Register TODAY on:1www www.carriersworld.com/submarine_nets_2002/ or telephone: tunities +44 20 7242 2324.

30 The State of the Industry Europe · The Middle East · Africa · India

By Christian Annoque

It has long been considered that, for future. On the back of this the world private submarine systems for commercial worldwide telecommunications traffic there submarine market has increased five-fold gain as opposed to building of infrastructure are 3 major trunk routes: Atlantic (Europe- from 1996 to 2000 ($1.1bn to $6bn). It to serve community needs. Americas), Pacific (Americas-Far East) and would appear that some of the usual However we can consider that the days Europe-Middle East-Far East (or the EMAI historical drivers have been responsible for of easily predictable slow traffic growths region – Europe, Middle-East, Africa and this growth, for example the requirement have long since left us and the move away India). This paper attempts to give an for additional capacity and the introduction from monopolistic consortiums to private overview of the latter market from the of a new technology (DWDM), but in systems has meant that business plans and viewpoint of submarine telecom- addition there were other powerful factors system designs have become more and munications systems; a brief history, at work. In Europe, privatisation and more complicated. current activities and, hopefully, a glimpse deregulation precipitated increased of the future. competition and reduced prices thereby EMAI stimulating growth in traffic, not only As for all regions, in EMAI the necessity for Growth locally but also on major international submarine systems in the past has been This year aside, the global tele- routes leading from Europe. The growth of governed by the growth of voice traffic, communications market has recently seen the Internet has also been a contributing geography and politics. However, unlike the growth rates unprecedented throughout its factor (although on a more global scale) and other two major routes (Atlantic and long history. This has been due to several finally the fact that markets are, for the Pacific), the EMAI route is not two factors all of which pointed to sustained most part, no longer monopolistic led to continents divided by an ocean but rather and continued high growth well into the the reality of constructing and operating an old trade route strewn with countries

31 (and small seas) that contribute to the (as far as the region is concerned). Along to fight off competition from terrestrial market. This has an effect, not only on the the way are a number of branching units systems; not a concern of the Atlantic and market dynamics, but also on the design allowing the systems to land in countries Pacific trunk routes. and topology of the submarine systems such as Saudi Arabia, U.A.E, Algeria, Egypt themselves. and Pakistan. Market As examples, the FLAG and the Sea-Me-We These networks have therefore taken The submarine cable industry is a cyclical cable systems faithfully follow the Europe, on the characteristics of both trunk routes one with market downturns when capacity Med, Middle-East, Far East route skimming and regional systems. However this also needs are met and upturns with the the top of Africa and terminating in India means that some legs of the networks have introduction of new technologies and/or when demand could be seen to overtake “stock”. However the recent downturn in the industry is unusual in that it has coincided with reduced interest from investors in technology companies in general and a significant reduction in the involvement level of the financial markets in telecoms specifically. In other words, telecom companies have suffered amid the slowing economy, a perceived glut in fibre optic network capacity and a tightening of the capital markets. This has resulted in many telecom projects being cancelled, companies and operators filing for “soft” bankruptcies and a raft of redundancies in most telecom companies, as has been reported in the press in recent months. Carriers in the market are fighting to survive. While it was expected that at some

32 point there would be some rationalisation and liberalisation still occurring or yet to of the players, due to oversupply and take place in some markets. Christian Annocque market conditions, it would appear that joined Alcatel’s subma- rine networks activity as carriers are simply closing down operations Future?/Thoughts/Conclusions project manager. The Most analysts are predicting that the while the infrastructure remains unused Sea Me We 1 project and un-sellable. The future then looks submarine cable market will once again (linking the Far East with difficult except that many would argue that, pick up momentum by the end of 2002 and, the Middle East and despite these differences, we have been here perhaps, be back to full strength by the end Western Europe) was his first major international project. In early before and, in any case, not all telecom of 2003. Time will tell but certainly the 1989, he went to Australia to participate in the market will return from the current trough markets have become totally inactive . . . start up of the new Alcatel company based in we will look at this later. as it has done several times in the past, Sydney (the Alcatel Tasman Cable Company) Historically these “troughs” last 12–18 albeit that it may take some time to do so. in charge of implementing the Tasman 2 ca- months; could this one be any different? We can be confident of this because, whilst ble system (linking Australia to New Zealand). Other major projects Christian Annocque dealt There are many more technologies/ orders are not being placed at previous with during his time in Australia include the levels with suppliers and restricted applications than ever before with different PacRim East and West in the Pacific Ocean. market forces which makes for a much more financing being made available to carriers, He then moved to Alcatel Singapore where complicated scenario. For submarine traffic still continues to grow. Therefore at he became Vice-President for the Asia-Pacific systems the negative “cyclical forces” are some point submarine systems will have to Region. He is currently based in London UK as Regional Director for Europe-Africa-Middle perceived to create upgrade potential in be upgraded and/or replaced, not only to East and India Subcontinent. existing systems, technology uncertainty provide the market with more capacity but (10 or 40G?), telecoms ‘out of favour’ with to make the current networks more efficient the financial markets, debt within the for IP use and utilise the latest technologies. industry, and fragility of new entrants. However, despite the current market the financial downturn and its effects on However the positive points could be climate, there are still areas of activity with the telecom industry but we have seen in considered to be the need to adopt 40G, some countries still looking to invest in recent months that where there is a telecoms “arrives” in India and China, infrastructure. The obvious three are Africa, demonstrable need for infrastructure and a “third world discovers data”, increase in India and China; two of which fall into the sound business plan, investment can still access technologies, shift in customer base EMAI region. These markets still suffer from be found.

33 Presently there is activity in India that Global entrants have been consistent capacity. This means that a large portion is having a profound effect on her market big spenders and quick to take advantage of the future market will be in upgrading dynamics. Part privatisation of public of market conditions and readily available existing systems to higher capacity as it is utilities, deregulation, a healthy increase in capital to install regional and global required. competition and targets set by the networks. While these companies are In conclusion, while the submarine Government to increase teledensity are all reviewing their strategies there is some cable industry is in one of it’s “cyclical elements fuelling growth in the industry. evidence that at least some of them are troughs”, there is some cause to believe that This in turn has meant interest in looking at new opportunities. this will soon begin to improve and much submarine systems. Generally opportunities can be found of it will be thanks to the activities and Already a system between India and with the introduction of new technologies. growth that we are currently seeing in the Singapore has been installed by Alcatel with Therefore the coming of enhanced access sub-continent of India and parts of Africa. further interest in domestic rings and technologies (such as xDSL and G3) and This activity, along with new technologies, festoon systems plus links to any landing 40Gbps for long haul applications could could well be the catalysts that kick-starts point or system that can provide provide stimulation for the market. the industry’s re-emergence from the connectivity to the US. To promote this activity and growth, downturn. Africa still desperately requires internal it is envisaged that, in the near term, more (domestic) connectivity. There are various financing from suppliers will be required initiatives to provide greater access to to support viable projects. However in these ORGANISING A public phones that in turn will require difficult times suppliers are having to face infrastructure to cope with increases in the same business problems as their CON ERENCE? domestic and international traffic. customers. Give your exhibition or conference Africa is in a position to take advantage Of course, cost per Gbit/km remains a maximum exposure to the submarine of the latest technology but lack of major driver and “must” be achieved with telecoms industry. investment and a small base infrastructure the latest technology. However many Advertise your event in could very well lead to problems. Africa1, customers still appear to be interested in Submarine Telecoms Forum while seen as vital by many to Africa’s huge capacities despite the fact that, on and reach all the key people. development is unfortunately being average, utilisation of current systems is Email [email protected]@subtelforum.comadvertising @subtelforum.com delayed. around 14-16% of potential installed

34 [email protected] 1www.ctcmarine.com

35 A global guide to the latest known locations of the world’s Tracking the Cableships cableships, as at January, 2002. Data supplied by Lloyd’s Maritime Information Services Ltd

SAILING DETAILS (or last known location) Vessel Name Built Current Parent Company GRT SPEED Sailed Date Port Country

AGILE 1978 Secunda Marine Services Ltd. 9402 14 17/12/01 Dublin Ireland ASEAN RESTORER 1994 Singapore Telecommunications Pte. Ltd. 11156 16 03/12/01 Singapore Republic of Singapore BOLD ENDEAVOUR 1999 The Royal Bank of Scotland Group plc 9388 12.6 15/12/01 Busan Korea BOLD ENDURANCE 1979 Secunda Marine Services Ltd. 9216 14.3 20/11/01 Singapore Republic of Singapore C. S. MONARCH 1975 HSBC PLC 3795 13.5 11/12/01 Dover Strait United Kingdom C. S. NEXUS 1972 James Fisher and Sons Plc 11000 12 Victoria(BC) Canada C. S. SOVEREIGN 1991 British Telecommunications plc 11242 13.5 17/11/01 Brest France C. S. WAVE MERCURY 1982 Global Marine Systems Ltd. 10105 16 Kobe Japan CABLE INNOVATOR 1995 Global Marine Systems Ltd. 14277 11 15/12/01 Hong Kong People’s Republic of China CABLE INSTALLER 1980 Global Marine Systems Ltd. 2986 12 Sydney Australia CABLE RETRIEVER 1997 Singapore Telecommunications Pte. Ltd. 11026 16 Kaohsiung Taiwan CERTAMEN 1965 Italmare S.p.A. 4996 14 Catania Italy DISCOVERY 1990 N.V. Friary Ocean Surveyor 8248 12 04/11/01 Cromarty Firth United Kingdom DOCK EXPRESS 20 1983 DOCKWISE N.V. 14793 15 09/10/01 Dover Strait United Kingdom ELEKTRON 1969 Statnett Entrepenor AS 1628 17/12/01 Rotterdam Netherlands FJORDKABEL 1985 331 18/09/01 Kantvik Finland FRESNEL 1997 France Telecom 6475 14.5 10/12/01 Singapore Republic of Singapore GIULIO VERNE 1983 Pirelli Cavi e Sistemi S.p.A. 10617 10 Brindisi Italy GLOBAL LINK 1991 Transoceanic Cable Ship Co. Inc. 13201 15 Baltimore United States of America

36 SAILING DETAILS (or last known location) Vessel Name Built Current Parent Company GRT SPEED Sailed Date Port Country

GLOBAL MARINER 1992 Transoceanic Cable Ship Co. Inc. 12518 13.8 Singapore Republic of Singapore HAVILA REEL 1976 Havila Shipping AS 3186 11 18/12/01 Cork Ireland HAVILA SKAGERRAK 1976 Havila Shipping AS 7172 10 06/12/01 Halden Norway HEIMDAL 1983 10471 16 Singapore Republic of Singapore IBERUS 1978 Transoceanic Cable Ship Co. Inc. 8334 17 Hitachi Japan KDD OCEAN LINK 1992 Kokusai Cable Ship Co. Ltd. 9510 15 Yokohama Japan KDD PACIFIC LINK 1993 Tokyo Lease Co. Ltd. 7960 13 20/12/01 Moji Japan KOUKI MARU 2000 Dokai Tugboat Co. Ltd. 9190 13.5 07/10/01 Yokohama Japan KOUSHIN MARU 1998 Dokai Tugboat Co. Ltd. 4822 12 15/12/01 Moji Japan KUROSHIO MARU 1975 Government of Japan 4795 16.5 31/10/01 Kanda Japan LEON THEVENIN 1983 France Telecom 4845 15 19/12/01 Brest France MAERSK DEFENDER 1996 A. P. Moller 5746 16/11/01 Recife Brazil MAERSK FIGHTER 1992 A. P. Moller 3713 16 Fredericia Denmark MAERSK FORWARDER 1992 A. P. Moller 3624 16 Tyne United Kingdom MAERSK RECORDER 2000 A. P. Moller 6292 14 20/11/01 Busan Korea MAERSK RELIANCE 2001 A. P. Moller 6292 14 11/11/01 Hong Kong People’s Republic of China MAERSK RESPONDER 2000 A. P. Moller 6292 14 16/12/01 Singapore Republic of Singapore MANTA 1992 Jade-Dienst GmbH & Co. KG 2723 15 Houston United States of America MIDNIGHT CARRIER 1976 Torch Inc. 2670 13 08/11/01 Tarifa Spain MISS CLEMENTINE 1996 Coastline Maritime Pte. Ltd. 3637 9 Singapore Republic of Singapore MISS MARIE 1998 Coastline Maritime Pte. Ltd. 3639 13/12/01 Singapore Republic of Singapore NORDKABEL 1969 395 10 15/12/01 Harstad Norway

37 SAILING DETAILS (or last known location) Vessel Name Built Current Parent Company GRT SPEED Sailed Date Port Country

NORMAND CUTTER 2001 Solstad Shipping A/S 12291 15 03/11/01 Bristol United Kingdom OCEAN CHALLENGER 2000 Rovde Shipping AS 5235 16.7 16/12/01 Busan Korea OCEANIC KING 2000 Polar Ship Management AS 12867 16 08/12/01 Sydney Australia OCEANIC PRINCESS 1984 James Fisher and Sons Plc 11121 20/11/01 Singapore Republic of Singapore OCEANIC VIKING 1996 Eidesvik & Co. A/S 9075 18 07/12/01 Suez Egypt PACIFIC GUARDIAN 1984 Global Marine Systems Ltd. 6133 10 30/10/01 Newcastle(AUS) Australia PETER FABER 1982 2854 07/12/01 Hirtshals Denmark PLEIJEL 1972 Televerket 1650 11 05/12/01 Kotka Finland RAYMOND CROZE 1983 France Telecom 4845 15 28/11/01 Valencia Spain SEA SPIDER 1999 Wagenborg Shipping B.V. 4008 10 29/11/01 Maputo Mozambique SEGERO 1998 Korea Submarine Telecom Ltd. 8323 15 26/11/01 Mutsure Japan SETOUCHI SURVEYOR 1979 1264 12 14/12/01 Hong Kong People’s Republic of China SIR ERIC SHARP 1989 Global Marine Systems Ltd. 6141 13.5 05/12/01 St. Vincent(WI) St Vincent SKANDI NEPTUNE 2001 District Offshore ASA 6318 14 07/12/01 Masan Korea SUBARU 1999 Government of Japan 9557 13.2 Yokohama Japan TENEO 1992 Transoceanic Cable Ship Co. Inc. 3051 14.5 15/10/01 Valencia Spain TYCO PROVIDER 1978 Transoceanic Cable Ship Co. Inc. 10493 14 Durban South Africa TYCOM RELIANCE 2001 12130 13.9 Astoria United States of America WARTENA 1958 407 9.5 14/11/01 Kolobrzeg Poland WAVE SENTINEL 1995 Global Marine Systems Ltd. 12330 18.25 Baltimore United States of America WAVE VENTURE 1982 Global Marine Systems Ltd. 10076 16 14/12/01 Astoria United States of America

38 Over 100 ROVs, 355 vessels worldwide, 900 ROV operators, ploughs that can jet down to 1000m, Phoenix ROV that works down to 2500m, UJ and MJ jointers . . . can we be of service?

Smit-Oceaneering Cable Systems 11911 M529, Houston, Texas 77041, USA Telephone +1 713 329 4500 ax +1 713 329 4805 39 www.socsys.com1www.socsys.com Submarine systems have already evolved a great deal. Only a few years ago the first WDM links offered 4-8 channels at 2.5 Gbit/s. Today contracts are signed for capacities of 80 x 10 Gb, and in the lab a variety of interesting technical solutions gives capacities which are 4-5 x greater still. What are realistic targets and how do we achieve them? Perhaps a better question initially is why we are searching for more capacity when it seems that we already have more Technology than we need? At present it seems clear that new cable orders are stalled as the potential of existing cables is exploited. Unless capacity growth stops, however, we will in long-span eventually need new cables. Assuming that in the long-term demands continue to increase at an ever-increasing rate, as they have in the past, we may need a lot more submarine capacity. No supplier can risk not developing higher capacities even when it’s unclear when the technology will be used. systems Consider current repeatered systems; By Tony Frisch these are based on Erbium doped fibre amplifiers (EDFAs) which offer a bandwidth of around 30 nm. With considerable effort this can be stretched to 40 nm, the difficulty

40 components and power. At present this 3 dB Output of unfiltered amplifier doesn’t seem to be particularly attractive. Power lost by The Distributed Raman Amplifiers filtering to 17 nm (DRA) is an alternative route to wider 2 dB bandwidth which at first sight appears more attractive; using a number of pumps at different wavelengths it creates wideband Extra power lost by gain in the fibre within the cable. 1 dB filtering to 35 nm

Raman amplification in the cable before the repeater P1 P2 P3 P4 0 dB 1535 1540 1545 1550 1555 1560 1565 Distributed gain offers system benefits being that to get the same gain over the significantly greater than 33%. This is why in terms of effectively reducing the total entire bandwidth requires complex gain- progress in pump development has been noise. Two challenges are that a number of flattening filters, which add significant loss one of the key features of long-span system very high power pumps are needed, and to the amplifier. development. that they have to be controlled separately Accurate gain flattening is important, Even more bandwidth can be achieved in order to get gain flatness. It’s worth as a long link may contain 100-200 using dual band EDFAs, which amplify in pointing out that pumps represent a amplifiers, so even small imperfections can the C and L bands, as shown below. significant part of the expense of a accumulate to unacceptable levels. submerged amplifier. Needing high powers C & L amplifiers need EDFA Power is important as the amplifier different doping levels C is a challenge for the pump supplier, and PC output is shared between the wavelengths, also adds to the electrical power needed to EDFA PL increasing the bandwidth from 30 nm to L drive the pumps. Since this has to be 40 nm would add 33% more channels, thus supplied from the shore via the cable, requiring 33% more output power. Since a dual band EDFA is effectively increasing the power needed, automatically Since the wider band filters absorb two EDFAs, it can offer 2x the bandwidth, increases the expense of the power feed more, the pump power needed is but it also uses 2x the number of system.

41 The two types of amplifier can also be These are just moving out of the the terminal equipment, whereas increasing combined. development phase and there remain issues the amplifier bandwidth requires changes Raman amplification in the such as cabling losses, splicing for to submerged amplifiers. Changes to cable before the repeater production and repair, and purchase cost. submerged plant are always more serious EDFA Nonetheless, this type of approach sems because of the need to maintain very high PR PE promising. An added attraction for fans of reliability. This approach doesn’t give any Raman amplification is that the small core Also applied at the terminal is Forward bandwidth gain, but does benefit from a of the negative dispersion fibre requires less Error Correction (FEC), which is no low noise figure, which may make it of pump power than a normal fibre to achieve newcomer to submarine systems. Its main interest for very long systems, where noise the same gain. benefit is that it allows the system to build up is one of the limiting factors. A An alternative to increasing the operate with a lower signal to noise ratio– negative point is that it requires twice the bandwidth is to reduce the spacing between the FEC reduces what would otherwise be number of pumps. channels. Initially the ITU grid which an unacceptable error rate. This means that With today’s fibres, effects due to specifies 100 and 50 GHz was used but amplifiers operate with lower input levels chromatic dispersion increase as the optical already we are seeing systems with 30-40 and are thus spaced further apart, giving a bandwidth is increased, thus requiring GHz spacing, based on better optical filter reduction in the total number of submerged complex compensation at the terminals, technology and other techniques may allow repeaters needed. New FEC codes are being but there are developments which may the channels to be squeezed even closer. Lab developed to give even larger benefits. provide solutions. A new combination of experiments have already shown that 25 Second generation FEC is generally based fibres with high positive and negative GHz spacing of 10 Gbit/s channels is on concatenating two stages of coding/ dispersions promises to equalise dispersion possible for long distance transmission. decoding, and work is already underway on over a wide band. These results are based on simple schemes which use “soft-decision” de- modulation formats (e.g.(NRZ, VSB…) but coding. Soft decisions improve the E-PSCF RDF there may be interesting possibilities using correction process by taking into account Large core Small core more complex modulation, which may also the size of each received signal; given a Amplifier +20 ps/km/nm -40 ps/km/nm require more complex reception suitable code, this information can be used [E-PSCF = Enhanced Pure silica Core techniques. An attraction of this type of to improve the correction process. This Fibre, RDF = Reverse Dispersion Fibre] approach is that it adds complexity only to requires a more sophisticated and complex

42 optical receiver chain to produce the multi- amplitude in order to have the same energy level signal required for the decoding per pulse (and thus the same performance) After a first degree process. as a 10 Gbit/s signal. This gives rise to in physics, Tony There has been much research into 40 potential problems due to non-linear Frisch worked in the research labs Gbit/s, with impressive results such as: effects. of British Telecom · 256 x 40 Gbit/s over 100 km The dispersive effects can be reduced for several years, · 32 x 40 Gbit/s over 2500 km by a variety of compensation techniques, where he acquired While the short distance capacity is most of which involve actively tracking the a masters degree large, it’s worth noting that the longer dispersion and adjusting the compensation in telecommunica- tions. He then distance capacity is less than that achieved to suit. Since this is generally needed for spent a few years with N x 10 Gbit/s. each individual wavelength, it threatens to in Alcatel Australia handling the testing and com- Moving from 10 to 40 Gbit/s, however, be an expensive solution for long distances. missioning of submarine systems. Following this, should not theoretically give more capacity, One of the major drivers for 40 Gbit/s is to he worked for AT&T Bell Labs, designing termi- as a 40 Gbit/s signal takes 4x the spectral reduce unit costs, and on past experience nal equipment in the US, before moving back to Alcatel’s submarine network activity in France, space. it should be possible to make 40 Gbit/s where he has made a gradual move towards the In terms of long distance transmission terminal equipment ~2.5x more expensive commercial world, while still keeping his interest 40 Gbit/s poses much more of a challenge than 10 Gbit/s units, which gives a unit cost in technology. due to dispersive effects, as the pulse width of 2.5/4 = 65%. For long distance terminal He is currently based in the UK, where he is much smaller than that of 10 Gbit/s equipment the need for adaptive is in charge of product marketing for Alcatel’s sub- marine network activity. signals, while the spectrum is much compensation techniques, etc. will make broader. this target extremely hard; if the new units become too complex, then the economic

40 Gbit/s 0 dB benefits will be lost. It’s worth also detection, optical regeneration…) which considering whether 40 Gbit/s may be too cannot be discussed in detail due to lack of

10 Gbit/s -20 dB large a unit of traffic for the current space. As general remark, most of these time -40 040 frequency economic climate. seem also to involve significant complexity, All other things being equal, the 40 There are a number of interesting which raises a question regarding their Gbit/s signal also needs to have 4x more research possibilities (e.g. solitons, coherent economic value. Today, more than ever, the

43 economic benefits will determine which technologies are successful. Lower cost per unit of capacity, however, is not just a technical problem. Higher capacities generally yield lower unit costs, providing that most of the capacity is used: otherwise the cost saving is only potential. An expensive cable where the bulk of the capacity will be filled in the The 2002 edition of International Optical Networks and Fiber Optics Yellow Pages, a future may not be a good commercial resource work and industry directory, is now being prepared for publication by choice. Information Gatekeepers, Inc. Until we see rapid growth, it could be The worldwide directory will identify over 5,000 optical network, fiber optic and that small systems will appear more telecommunications companies. Approximately 20,000 copies of the 2002 publication will attractive, in which case technology will be distributed to attendees of OFC, Fiberfest, SuperComm, NFOEC, ECOC, IWCS, CompTel, PTC, SPIE, SG Cowan, Terrapinn and IGI events need to look for new ways to provide low cost capacity. Arrange for your company to benefit from inclusion in this publication and its associated online directory. The total fee for a basic listing, posted to both the print and electronic Making predictions is always versions, is $25, USA dollars. A basic listing includes contact details for a representative uncertain, and the market is clearly in a of your company and a company description of up to 50 words. situation which gives few good clues. In the Additional offices or related businesses may be included at $10 per listing. Your company’s short-term evolution of 10 Gbit/s systems capabilities may be advertised inexpensively in either version of the directory through combined with new fibre mixes seems the purchasing embellishments to your listing. Such embellishments may take the form of best route to reasonable increases in bolding your company name or including your logo, which will serve as a link to your website in the online directory. capacity while also giving cost reductions. Additionally, there could be room for Please click here - www.fiberopticsyp.com - to review the listing for your company. Listings may be established or updated by emailing your company’s contact details and description, additional sophistication (such as more before January 28, to Pamela Barnett, [email protected]. Contact Pamela also to order a powerful FEC or complex modulation/ copy of the 2002 International Optical Networks & Fiber Optics Yellow Pages directory. detection) in the terminal equipment. The price is $89.95, USA dollars.

44
ibre Optics in Offshore Communications

By Jon E Seip, MSc

Despite the tremendous attention on the degree. Although some fibre optic links development of telecommunication from shore to platform and between services everywhere, they are still not platforms were constructed. Cost of easily available offshore. On land and in installation and lack of protection submarine networks, systems are philosophy as well as lack of experienced Nexans, with both manufacturing and running with transmission rates of operators willing to offer “land” services installation capabilities, was prime Gigabits or even Terrabits per second. offshore are the most likely explanations. contractor for the NorSeaCom I network Demand for bandwidth is increasing all Now, with increased competition in and has world-wide experience in the over the world, and the offshore industry the tele- and data communication market domain of repeaterless fibre optic is definitely no exception. and mature technology readily available, submarine cables “Fibre to the Home” and “Fibre to the regional offshore networks are popping up. Early in the development of fibre optic Building” were the buzzwords in the early It is a fact that some of these networks have cable systems offshore, oil companies called 90s all over the world. not been easy to construct, however, for the tenders. Now the evolution is that However, fibre to the offshore experience has led to the development of oil companies go to international service platform was not a concept to the same an improved protection philosophy. providers for a complete set of services,

45 security of operations and future safe technology. The result is thus functional OIL COMPANIES DIGITALISATION - CASH FLOW specifications and a traditional relationship 20.000 between equipment suppliers and telecom- Cumulative Net annual savings Total SEA (South East Asia) Cumulative Net annual savings Total PG (Persian Gulf) munication operators. 15.000 Cumulative Net annual savings Total GOM (Gulf of Mexico) Cumulative Net annual savings Total NS (North Sea) As indicated above, a key for a 10.000 communication service provider to be able to offer competitive solutions, is to reduce 5.000 the cost of installation. Studies performed MILLION USD MILLION by Nexans have shown that installation 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 accounts for more than 70% of the -5.000 completed network cost.

Other studies with a completely other -10.000 perspective have shown that there are YEAR substantial opportunities in platform cost Cash flow for digitalisation scheme; Source: Facilium ltd. savings, safety and security through the provision of fibre optical cable based services. areas show that there are significant FOCS offshore, it would be interesting to Only in the North Sea there are investments and savings involved. Positive discuss how these possibly could be altogether some 40,000 people working, the cash flow is generated in 2006. reduced. amount saved making some of these One example of obvious saving if more It is a fact that the requirements for individuals capable of doing their job people are working onshore, is the reduced installation vessels operating in an offshore remotely, onshore, is estimated at 3 Billion number of helicopter transfers required. environment are completely different than USD with an estimated investment in fibre You would obtain not only reduced OPEX, for cable laying vessels installing ordinary optic infrastructure of 200 MUSD. (Source but also reduced risk (HSE) and reduced submarine networks. These requirements AT Kearny) pollution. include dynamic positioning, back-up A cash flow estimate through the Having indicated that cost of power, manoeuvrability and navigation, establishment of fibre optic cables in these installation is the major cost element in a and are non-negotiable. So part of the cost

46 must be accepted in an offshore cable has been decided constructed. Fibres well be possible at a later stage. In the environment. could be introduced in power cables and intermediate phase a collapsed ring with all There may, however, be other ways of service umbilicals at a small extra cost and fibres in one cable offer some of the benefits reducing installation cost. Efforts should be virtually no extra installation cost. of a ring structure. made at optimising the cable route with Nexans has supplied and installed a A collapsed ring is a configuration respect to reducing the number of cable- wide range of composite cables containing between fibres in a cable so that they form and pipeline crossings, and to avoid areas fibre elements, and experience shows that a ring between synchronous (SDH/SONET) with hard soil. Desktop studies based on once installed such links have an excellent transmission equipment in both ends. On previous surveys, as well as actual route track record. such a ring one can then add drop point surveys should be mandatory. Offshore Moreover, the network design should on the way, either as one part of the ring more than anywhere, the best way between have the possibility of future extensions. only or on both parts. The branching units two points is not always (read: not often) The use of Branching Units with blind ends in such a ring would be so that some fibres the straight line. It should be noted that represents a very small investment for will be connected straight through, while installing a FOC in an offshore future tie-in of planned fields links. most of them will be connected to the environment is considerable more costly A physical ring network gives the best branch. than in other areas. network protection against a cable or a Thanks to the above solution, and As mobilisation of vessel is part of the system failure. For cost reasons it may not because unused fibres could be planned in cost picture, one could envisage cost saving be possible to construct a physical ring the cable, it would be possible to manually in combining marine campaigns, and/or initially, but through grand designs and reconfigure the rings to avoid a damaged look for cost saving through the use of switching traffic between telecom- branch if a platform or cable is damaged combined cables where for instance a power munication operators, physical rings may because of an incident. If the main cable

Smit-Oceaneering Cable Systems 11911 M529, Houston, Texas 77041, USA Telephone +1 713 329 4500 ax +1 713 329 4805 2www.socsys.comwww.socsys.com

SUBMARINE TELECOMS CABLE INSTALLATION AND REPAIR : OFFSHORE COMMUNICATIONS CABLE INSTALLATION

47 were damaged, the total system would be armour package is important. For offshore relative to the tube, and the tube is filled out until the cable is repaired. use Nexans has offered the SAH, the HA and with a water-blocking compound. The the triple armour designs hermetically sealed steel tube provides Components All the URC-1 designs are based on the effective protection against excess fibre Nexans offer an internationally recognised same cable core consisting of a central tube, loss. cable family referred to as the URC-1 in which the fibres are protected by a laser For electroding and/or tracking (UnRepeatered Cable) consisting of 7 welded stainless steel tube housing a purposes a copper conductor in the form different armour designs plus a triple maximum of 48 fibres. The SAH and HA of a copper tape is applied over the steel armoured design for dynamic applications. designs can also be provided with up to 8 tube for the uni-tube design and in the form In order to offer maximum physical tubes giving a maximum fibre count of 384. of two solid conductors for the multi-tube protection of the cable, the choice of correct The fibres have a controlled excess length design. A polyethylene sheath is applied over the steel tube(s) to complete the cable URC-family core. The armouring consists of one layer for the SAH, two layers for the HA and three layers for the dynamic riser cable (RC - not shown in the picture). The outer protection consists of two layers of yarns flooded in bitumen or a polyethylene sheath. The URC-1 cable design ensures that no strain and ultra low pressure is exerted on the fibres in normal operation. Even if the cable breaks, high strains and water ingress are limited to a short length, so that the bulk of the cable remains serviceable. The Heavy Single Armoured cable (SAH) is intended for use in areas where the cable is buried. The Heavy Armoured (HA)

48 cable is intended for use in areas where maximum protection is required, typically on unburied sections, pipeline crossings, cable crossings, in areas with rock dumping, and also to be used as a riser cable for static or semi-dynamic installations.

Joint Box Joint Box The joint box (type URC-1-JB) shall provide optical and mechanical continuity between contiguous cable sections and serves as a factory or repair joint.

Branching Unit (BU) The BU allows the connection of three different cables in a predetermined manner. The unit does not contain active network elements, and thus no unauthorised re- routing can be accomplished from the terminal stations. The outer branching unit body is a simplified version of the type used in repeatered cable systems. The URC-1-Q1-JB cable joint (without bending strain relieves) fits directly into the same space as the moulded repeater cable joints and thus no further adaptations are required. Branching Unit (BU)

49 In addition the following accessories installations, an anchoring device might be Crossing of cables are called for in an offshore environment: required to obtain the optimum cable Separation between the new fibre optic Sealing arrangement – for some configuration between platform and sea cable and the existing cable should be in platforms where J-tubes are available, a floor. the area of 0.3 m. Mattresses on top of the sealing system might be required at J-tube fibre cable should be installed from trench inlet and outlet to reduce J-tube corrosion. Protection Philosophy to trench. 30 m of a special wrap should be Weak Link - For some platform Different requirements for protection of installed on the new fibre cable at the installations a weak link might be required fibre cable exist in any cable route. In section that will cross the existing cable. on the cable system to reduce the breaking general the fibre cable should be trenched strength of the cable system at the platform. with backfill to meet typical protection Pipeline crossing – exposed pipelines Pull-in Wire - All riser cables will be requirements. During a pre-survey of the lay route, pre- terminated to a pulling wire for the pull-in Areas where trenching is not possible fabricated concrete bridges should be operation. are typically pipeline crossings, crossing of installed on top of pipeline crossings. The Hang-off Head - All riser cables will be telecommunication cables and in the bridges should be provided with a groove terminated to a pull-in head after that the proximity of platforms. to allow the fibre cable to rest securely. riser cables have been pulled in by means The basic rule is to protect the fibre Bridges are designed with a sloping face to of the Pull-in Wire. cable from trench to trench. deflect trawl board strike. During laying Bend Stiffener - For some installations, Extra protection mattresses or tunnels operation the cable would be guided in especially dynamic configurations, bend should be installed if required from the J- position by using an ROV. Locking pins stiffeners might be required at platform tube to maximum 50m along the fibre should be closed to keep the cable in and/or subsea. cable. The purpose is to protect against position. Buoyancy Elements - For some object dropped at platform proximity. Concrete mattresses should be installations, especially dynamic Rock dumping should be considered installed on either side of the bridges after configurations, buoyancy elements might in special cases where trenching to the the laying operation for protection of the be required to obtain the lazy S-shape to required depth is not possible or cable from trench to trench. Again, a special allow the cable to move in a controlled way. unfavourable. Usually, the need for rock wrap around the cable should be installed Anchorage Collar - For some dumping is evaluated based on a post- on the fibre cable at the section, which will installations, especially dynamic trenching survey. cross the pipeline.

50 Applications maintenance and a reduced number of Conclusion A wide variety of potential applications specialists offshore.” There is a considerable saving potential exist on a high fibre count offshore “Software maintenance onshore – associated with the construction of fibre network. again less specialists offshore.” optic networks offshore. The investments Broadly applications could be “Personnel benefits – video calls home are significant and especially the described as remote monitoring, remote or to office, remote links for medical installation and protection of the fibre optic control and operations of the field. Remote support.” infrastructure have proved to become costly. service and training of offshore personnel “Service request – link straight to The presence of telecommunication service could also be envisaged. contractors. Some of this work could be providers with a vision is essential to ensure Coming straight from the SEG (Society performed remotely e.g. data analysis.” professional, future safe operations through of Exploration and Geophysicists) “Remote surveillance – of normally open interfaces. International Exposition in San Antonio, it unmanned areas, for automatic shutdown, is natural to envisage real time monitoring resets etc.” of fields. This would be possible if a “Real-time drilling data to the experts: Jon Seip graduated as MSc permanent ocean bottom system is in place reduction in downtime as better drilling from Norwegian Institute of and a source is available (Gunboat). This decisions are made. Radically faster Technolgy in 1986 and has worked with Alcatel and could be referred to as intelligent well decisions when all the drilling data can Nexans for almost 14 years technology. reach the expert, not the other way in various positions. He has Videoconferences with nodes in, let’s around.” worked with marketing of say, Houston, London and on platform “Integrate offshore applications into high voltage and composite could easily be set up to analyse real time the value chain: equipment requests link cables as well as design and marketing of complete communications networks. operational challenges. to warehouses, other rigs and contractors.”

I believe the above mentioned During his career he has held positions in Paris for Comments from potential users: applications are only the tip of the iceberg. more than 5 years in international assignments for Here are some comments from potential With the network available and the Alcatel Cable and Alcatel Telecom. He is currently users: existence of standard interfaces, a wide Senior Marketing Manager for Oil & Gas for the Communiaction Cable Division of Nexans Norway “We could have more servers onshore selection of additional applications will AS. – less equipment offshore means less appear.

51 The Cable ship Letter to a friend CS “Global Activity” from Jean Devos is in dry dock! The repair could take 2 to 3 years! Submarine cable activity has suddenly come to a full stop. Senior management really did not see this coming and have now had to resort to desperate measures, with no real visibility and often with a complete lack of vision! The “trough” looks very deep and painful, especially when contrasted with the historic peak of the last 3 years!

Was everybody wrong?

In the course of the year 2000, we saw the announcement, “Urbi et Orbi”, of several new global submarine cable networks: Paris, l 360N November 2001, l FLAG l TyCom l 1Cybernet l NMDG etc.

52 We saw the suppliers adjust their So . . . what happened? People’s behaviour has created an artificial production capabilities to a $10B market peak that could create nothing else beyond when the market had for a long time been other than a deep ravine! around $1B. Lack of wisdom: Success makes you blind The submarine cable world allowed Worldwide cable production capacity and the competition makes you lose your itself to be torn apart by a was increased by a factor of 3; the number common sense! Big Storm. of specialised cable ships by 2. One of the reasons for this downturn In that same year, the transmission can be summed up as The tornado of change swept out the people in place, the traditional behavior, capacity of a single cable increased by a People Behaviour. factor of 10, thanks to the explosion of the vast experience acquired over a long WDM technology and the increase in the There is a general belief these days period of time, the specific values. number of fibre pairs from 4 to 8. that things are somewhat predetermined, The prevailing culture was “industrial” Today, at the end of 2001, some that they are inevitable and that the quality, and “planning” and as a result it was very networks operator are in bankruptcy or wisdom, and forward vision, of the people difficult for people accustomed to a slow administration, a lot of projects are “dead” in charge play a very minor role! How moving environment to adapt themselves (25% of all projects). wrong can you be? to a world suddenly very turbulent!. New cable ships are coming out of We tend to analyze situation But is this enough to explain the their shipyard “jobless”, to get parked in evolution in a macro-economic manner. In sudden “extravagance”! Does this explain front of “mothballed” cable plants! reality, very often situations would have why for instance SCS put its own existence Many good people are losing their been quite different, had other managers at risk by trying to establish a position in positions. been in place. the Atlantic? But all this, Some managers are more prudent than Is it sufficient to explain why Tyco despite the fact others, some are more bullish. Some are could not resist to the temptation to that inter- dedicated to the long term good of their become another Global Crossing? national activity, some are only looking to short term Does this explain the brief life of traffic con- result. 360N? ( 360 !) tinues to grow The huge trough that we are seeing Or why ASN put so much money into as planned!! today could have been smoothed out. cable ships instead of developing a deal with

53 FT (M) with whom they had historical links, No doubt, the situation in the Atlantic and finally why system prices fell in such a would have looked today very different! suppliers market?? From then on people’s behavior changed radically: The cable market explosion(new operators) was such, and the TAT 14 opened profit so attractive that people started to Pandora’s Box! loose their common sense. Success made people blind and competition became a fight to the death The decision to have TAT 14 built by SCS rather than a high level sport. Competition was the will of a handful of key players drove suppliers mad! The bigger the better! without consideration of the consequences. Short term victories and so on. The emotional reaction of the traditional Atlantic suppliers, who clearly Where is the perceived the message, was to some extent the cause of today’s situation. How? submarine The pride of the ASN and Tyco cable culture today? managers was deeply wounded. They felt unfairly treated, their technology Jean Devos, the Past President of SUBOPTIC, was formerly Senior Vice underestimated !! They felt insulted! Is this now just another business? President of Sales and Marketing for As a consequence ASN chosen to give “Financers” have replaced the Tyco Submarine Systems Inc., and powerful support to the new competitors, “Industry Managers”… The consequences previously Director, SUBMARCOM and the new carriers’ carriers: Flag Atlantic, are enormous. Priority is given to the short Director Marketing and Projects for Atlantica, then 360N,then Apollo. term, the visible, the immediate profit that Alcatel Submarine Networks. In a similar way Tyco helped Yellow is required by the stock market! It is now then Hibernia aggressively … and finally compulsory for managers at every level to decided to become TyCom! be up to the minute, to drive with their eyes

54 on the bottom line only. As if one can drive was upgraded slowly, to fit the traffic a car without looking on the road ahead! growth. And the people who managed to Submarine Telecoms Today’s figures are more important develop the technologies had the right to of major importance than to-morrow’s future! The preference is contribute. at PTC 2002 for the manager who can lay a straight line The new deregulated world, highly of stones, rather than the one who has the competitive, requires perceptiveness, so as John Legere, CEO, Asia Global Crossing, vision to build the cathedral! Instead of to segregate the credible initiatives from the will address the 24th annual Pacific Tele- communication Conference (PTC2002) in adding the finance capability to the existing others. This common sense has been a Plenary presentation on 14 January in culture it has simply replaced it! lacking! Everybody expressed more than Honolulu, Hawaii. Those who still had a long-term scepticism for Oxygen … and then everyone The Plenary Session will also be graced strategic view were either just not listened followed a similar pattern! with presentations by Haruo Murakami, Chair- to, or choose not to fight against the wind! man, Telecommunications Carriers Association and Chairman, Japan Telecom Co., Ltd, and Even worse, “internal people” were Conclusion Minister Wu Jichuan of China’s MII (see p8). replaced by “new managers” bought at huge Secretary-General of the International Tel- price from other businesses. ecommunications Union (ITU), Mr. Yoshio These guys started to be very vocal in The present letter reflects a disappointment Utsumi, will address the delegates as a keynote our international scene where they taught more than a criticism. Some people will speaker during the Opening Session on Sun- day afternoon. He will speak to the conference the crowd the new gospel:” Yes the trees surely tell me that I am nostalgic for an theme: Next Generation Communications: Mak- can now grow up to the sky”.. Serious earlier age. But the intention here is to ing IT Work. analysis was replaced by “communication invite the submarine community to sit and Three Generations of ITU Secretaries- plans” where “looking like” was more consider, since the activity will not restart General are to speak at PTC2002. Mr. Utsumi’s important than real achievement! without changes. I am awaiting your two immediate predecessors, Pekka Tarjanne (Finland) and Richard Butler (Australia) will par- The “industry managers” gave priority reaction. ticipate in the first concurrent session: Develop- to the “mission” of their company and its This activity is not just another ment Challenges for the Asia-Pacific Region. long-term life, treating people’s capability business. The session will be chaired by Richard and investors equally. This activity needs to return to Nickelson, Senior Advisor to PTC, who worked People’s skill and know-how were the wisdom, which is not incompatible in senior positions in the ITU for 25 years. www.ptc.org values given priority.. The global network with ambition.

55 Australasian submarine communications conference A once-only chance to hear from influential strategists and CEOs

THE AUSTRALASIAN submarine com- Telecoms partner with the firm, Michael A reality check on commercial munications industry gets its once-only offers practical tips on minimising potential opportunities is offered by Tom Soja and chance to hear from the world’s most liabilities in cable crossing agreements. The Associates’ director, Asia Pacific, Anne Le influential strategists and CEOs at a major dynamics of privately owned consortia and Boutillier. She tracks drivers for broadband submarine communications conference in public cable projects are analysed for new networks in Asia Pacific and critically Sydney on 19-20 March 2002. opportunities. examines claims of a broadband glut. In a keynote presentation, Cable and Dan Campbell, US senior vice president Trading bandwidth as a commodity and Wireless’ UK vice president, global operations, for Dolphin Networks, a leading financier for impact on carrier revenue is addressed by Alan Robinson outlines the telco’s revamped cable systems, offers tips on turning paper Europe’s leading bandwidth exchange firm, plans for strategic alliances with subsea projects into profits. ABN Amro’s Brian Band-X. The company’s co-founder and CEO, operators and network service providers. In Tellam, director for project financing, Richard Elliott, explains how Band-X’s an analysis of the telco market, he signposts Australasia, echoes this theme. successful strategy can be replicated in Asia new business opportunities for cable Submarine Networks World brings Pacific. operators, including the outlook for integrated together a special CEO panel featuring Patricia Bagnell, Africa One’s US vice voice, data and video Charles Jarvie of Nava Networks, Australia president, identifies commercial oppor- communications. Japan Cable’s Robin Russell and Steve Liddell tunities in emerging markets profiting from Protecting of Level 3 Communications in Hong Kong. telco liberalisation. submarine and net- This panel also draws on insights from Rajesh Kheny, Singapore managing work projects from Amcom IP One’s Andy Mclean and John director for TyCom Asia Pacific, offers updates partner insolvency Losco, Nextgen Networks. into the company’s latest R&D effort. is the theme for Baker & Mckenzie’s For information and booking details, check out www.submarinenetworks.com. Alan Robinson Michael Conradi. Contact: Shahida Sweeney, Terrapinn Australia: +612 9210 5764; [email protected]

56 11-12 January China Telecom Conference DIARY Honolulu, Hawaii, USA, www.chinaconf.com 13-17 January Pacific Telecommunications Conference 2002 Honolulu, Hawaii, USA,1www www.ptc.org.ptc.org 19-21 February Submarine Networks World EMEA Costa del Sol, Spain,2www www.carriersworld.com/submarine_nets_2002 DATES 27 Feb- 3 March Underwater Invention 2002 New Orleans, Louisiana, www.diveweb.com/ui 5-6 March Carriers World Asia 2002 Upcoming Singapore, www.carriersworld.com 5-8 March Oceanology International Conferences London, UK, www.oceanologyinternational.com 14-15 March KMI’s 5th Annual Conference on Fiberoptics Markets in Latin America 2002 Miami Beach, Florida, USA, www.kmicorp.com 19-20 March Submarine Networks World 2002 Sydney, Australia, www.submarine-networks.com/subnetworld2002aus 16-19 April Underwater Technology 2002 Tokyo, Japan, http://underwater.iis.u-tokyo.ac.jp/ut02/ 6-9 May Offshore Technology Conference San Antonio, Texas, USA, www.spe.org/ 16-17 May KMI’s 6th Annual Conference on Fiberoptics Markets in Europe Paris, France,1www www.kmicorp.com.kmicorp.com 2-6 June SuperComm, Atlanta, Georgia, USA www.supercomm2002.com 4-6 June International Cable Protection Committee Plenary 2002 Florida, USA, www.iscpc.org 13-14 June KMI’s 8th Annual Fiberoptic Submarine Systems Symposium San Diego, California, USA,2www www.kmicorp.com.kmicorp.com 17-21 June CommunicAsia 2002 Singapore, www.communicasia.com 57