Subsea Cables & Internet Infrastructure

The standard description is that 2Africa is a 16 fibre pair cable with 180 Tbps throughput. It comes right off the 2Africa website. That public figure is a bit misleading. Only the Mediterranean and Red Sea segments have 16 pairs. The all-important West Coast segment has 8. Now these fibre pairs should be capable of 20 Tbps or slightly more. So the West Coast probably does total 180 Tbps. Mediterranean could easily exceed 320 Tbps. Same for the still unfinished Red Sea segment. Design Capacity By Segment A. Mediterranean Sea: 16. B. Red Sea: 16. Not finished due to hostilities. C. Red/East Africa: 7. D. Red Sea/India: 9. E. West Coast: 8.

The chart below shows the issue. Total 2025 investments totaled $19.5 billion, yet the 1Q2026 investment alone was $16 billion. So unless the first quarter is an outlier, we are looking at $80 billion spent this year with most of it on an AI business that grew 22% in 2025 versus openAI's 230%. Note that xAI's recent deal with Anthropic does not necessarily improve the situation. This contract involves using xAI's data centers to train Anthropic large language models. Contracts of this nature are often closer to letters of intent than hard revenue commitments. And while such a deal might generate a lot more revenue, it will probably also require Starlink to spend more money on power, buy more GPUs, and the like. In other words, this deal might increase the company's negative cash flows. Starlink's current debt at the end of the first quarter of 2026 was $26 billion. The IPO will provide ample cash to wipe the slate clean, but there is a clear risk given that Musk is ...

1. AI division booked a $2.5 billion loss in operating income in the first quarter of 2026. The AI division began as X, but when Musk got AI religion, he pivoted towards developing the Grok large language model and two large AI data centers. To a large extent, he was searching for a way to make X profitable as the site right wing toxicity caused the loss of billions of dollars in advertising revenue. 2. The AI division is causing SpaceX as a whole to suffer massive bottom line losses. It is offsetting the healthy net income of the Internet service division. 3. Transforming X into an AI company with a large language model and accompanying GPU infrastructure was both a me-too investor move and an act of financial desperation. Musk's acquisition of X led to advertising revenue declining from $4.7 billion in 2022 to $1.8 billion in 2025. It was easy for Musk to take X private because the widening losses reduces the company's equity value. 4. Musk used his voting sh...

As the chart shows, Starlink is on track to lose $20 billion this year. These losses largely reflect the struggling xAI division that Musk shotgun merged with Starlink: "SpaceX had a net loss of $4.28 billion on revenue of $4.69 billion for the first quarter, compared with a net loss of $528 million on revenue of about $4 billion a year earlier, the filing shows." Not only does the company lack a clear path to profitability given the xAI division, it is giving Musk permanent control through a special class of voting shares. This is poor corporate governance and should never be done. No man is infallible. It is a recipe for financial disaster as Musk's plans are completely unrealistic and unprofitable like a lunar base, a million orbital data centers, and a Mars colony.

Tiktok is investing $25 billion in a Thai data center. They recently purchased over 4 terabits of Layer 1 capacity into Bangkok causing prices to skyrocket. I have located some spare capacity at the 10G and 100G level.   Appetizer ...  A point: Songkhla Cable Landing Station. Z point: SG1, Singapore.  Two diversely routed 10G waves.  Term: 3 years.  MRC per wave: $8.5K.

In the past most HK and Singapore traffic to the US was routed via Tokyo due to the lack of direct single cable links. So two cables were required to get to the American West Coast. The total 100G costs of two cable solutions were and are still today high with the range from the lower $30Ks to the low 40Ks. Obviously, the Tokyo routing latency penalty is also very high. It is possible to get 100G two cable solutions in the $20K range, but only a few 100Gs are available at that price point.  In recent years the hyperscalers have recognized that current routing raises cost per bit, latency, and makes Tokyo a single point of failure on their Pacific networks. As a result, new American Tech cables connect Singapore directly to San Jose Equinix or Los Angeles Coresite data centers. For example, META is the lead consortium partner on the new 12 fibre pair Bifrost cable that lands at Grover Beach, California, Rosarita, Mexico, and Winema, Oregon. Keppel owns several fibre pai...