New TransPacific Cable Projects:

Rod Beck Rod.Beck at
Sat Sep 22 09:26:23 UTC 2007

It is not obvious to me that there is a Pacific cable capacity glut. For example, I sold a DS3 from LA to Hong Kong for $6K MRC whereas the last time a wholesale TransAtlantic DS3 rivaled that figure was 2001.

Now you could argue that one needs to look at pricing on a mileage-adjusted basis since the typical TransPacific cable spans a much greater distance than its TransAtlantic counterpart. 

But operating costs are not proportional to mileage - the bulk of your operating expense is what you pay the undersea maintenance companies such as Global Marine and Tyco Submarine and Alcatel. And their annual charges are not very sensitive to distance. 

What is peculiar about the Pacific is the lack of new products. For example, it's extremely difficult to get any Ethernet transport on many routes such as LA/Sydney or into India. 

Yes, there is some Ethernet/IP junk, but that doesn't meet most of my clients' performance standards. It is IP masquerading as Ethernet. 

In fact, it is very difficult to find Packet-over-SDH Ethernet even on the all-important LA/HK route. 

To sum up, I do believe the median Pacific cable enjoys a substantial margin advantage over the median Atlantic 

There is only TransAtlantic cable that is particularly well right now, largely due to its unique physical diversity and footprint.  

Roderick S. Beck
Director of EMEA Sales
Hibernia Atlantic
1, Passage du Chantier, 75012 Paris
Wireless: 1-212-444-8829. 
Landline: 33-1-4346-3209.
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rod.beck at
rodbeck at
``Unthinking respect for authority is the greatest enemy of truth.'' Albert Einstein. 

-----Original Message-----
From: owner-nanog at on behalf of Deepak Jain
Sent: Sat 9/22/2007 12:44 AM
To: nanog list
Subject: New TransPacific Cable Projects:

This is what happens when I stay late at the office on a Friday. - Google participating in a new 
Transpacific Cable Project - 
Verizon on a different transpacific project

And all the same articles say there is already an overpriced glut of 
capacity along these routes and a glut of fiber laying ocean vessels.

Good times. Rather than having competition, everyone is just building 
their own routes that they won't share at wholesale prices to folks in 
the wholesale buying business. :)

Ahh... reminds me of the late 90s when everyone was building dark fiber 
networks for the surge of demand that was coming. Now, the remaining 
folks are buying up all the unused bits to constrain capacity.

If I were a stakeholder in transpacific cables, I'd be leasing up the 
next 3-6 years of the entire global cable laying fleet. :)

Deepak Jain

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