Subsea Cables & Internet Infrastructure

Firmus wanted to go public valued at $30 billion. How much actual data center capacity does it have booking revenue? 46 Megawatts. About the same power consumption as Vienna's Interxion 2 data center. Now Firmus has contracts for 912 megawatts. But there is no guarantee given supply side chain obstacles that it can meet its obligations. Nor do we know if these 'signed contracts' have any contractual teeth. A good guess is less teeth than grandma. Despite only modest-sized AI data center, Firmus has managed to incur $30 billion in debt and plan to issue more.  For full details, https://thetechcapital.com/firmus-shelves-ipo-valuation-concerns

What is amazing is how the EU consistently rewards European companies that failed to anticipate technological change like Eutelsat and Arianespace. Its French executives were too busy with two hour lunches, Bordeaux wines, and crème brûlée to realize that LEO satellites were the future. See the quotes below. 😉 Eutelsat is one of the prime beneficiaries of the IRIS2 project which involves a 330 LEO and 18 MEO constellation that will only cost $18 billion. We all know that Starlink could have done the project for under a billion dollars. A Starlink V3 satellite costs $1.2 million to manufacture and provides 1 terabit download throughput. The point is that the European satellite industry is grossly inefficient. It lacks the economies of scale in production. Hence a Fortress Europe approach to technology is likely to be super expensive. EU procurement often rewards mediocrity because it is trying to create sovereign infrastructure in areas where the Americans dominate and won fair and...

Ooredoo is a multinational mobile service provider with operations in Algeria, Tunisia, Palestine, Kuwait, Saudi Arabia, Qatar, Iraq, Oman, Maldives, and Indonesia. Its 2025 revenues were $6.4 billion revenues. Like many multinational mobile carriers such as Vodafone and Bharti, Ooredoo is becoming an important subsea cable player. Its first noticeable success was winning the competition to host the 2Africa CLS in Oman. More recently, Ooredoo announced in January 2025 the Fiber In The Gulf (FIG) cable that will link Kuwait, Iraq, Qatar, Bahrain, the UAE, Oman, and Saudi Arabia. Due to the short distances between the countries involved, this 24 fibre pair cable is expected to achieve 720 Tbps or 30 Tbps per pair, a Middle East record. The shorter the distance between DWDM optical nodes, the less optical errors accumulate, and hence the greater the throughput. The higher optical power or intensity required for long subsea spans inevitably creates nonlinear errors or optical distortion th...

The 16 fibre pair MVISTA project has the potential to disrupt the cozy world of Southeast Asian telecommunications. The majority shareholder is the Stavian Group, a Vietnamese industrial conglomerate building one of the first carrier neutral data centers in Vietnam. Stavian is a good example of how cash heavy and well established companies are entering the Southeast Asian service provider market in search of their slice of the Good Life. Another example is Keppel, which began life as a builder of offshore rigs after WW2 and today is a very successful asset manager of real estate, infrastructure (power), and connectivity. Companies outside telecommunications are drawn to subsea cables due to the robust connectivity demand in Southeast Asia. This reflects the region's fast growth, but also a fragmented geography. Many countries are islands like Indonesia, New Guinea, Philippines, Singapore or peninsulas like Thailand and Malaysia. The easiest way to build cost effective communication...

Coreweave is a startup AI Data center play. It makes Oracle look downright healthy and athletic. While Oracle's legacy software business generates a lot of cash flow, Coreweave totally depends on external financing in the form of stock sales and debt. Moreover, Coreweave has exactly the same problem as Oracle, namely high customer risk. Coreweave's main clients are Microsoft, META, and OpenAI. Now Coreweave claims to have a $100 billion backlog. But the Devil is in the Details. No contract is valid if Coreweave cannot deliver power, GPUs, and space to fulfill them. And that is exactly the probem. Demand vastly exceeds supply with no relief in sight for years to come. Secondly, it is likely that OpenAI and Anthropic are issuing more compute requests than they actually need given their soft commitment contracts. So if you add up the backlog across all customers, it probably vastly exceeds real demand.  These key fundamental factors are the same as in the case of Oracle. An AI da...

I am seeing a growing number of requests for subsea capacity linking Thailand to Singapore. Thailand is challenging for many reasons. Many consortium members own no fibre beyond the Thai cable landing stations. This leaves them hostage to the country's two main cable landing station operators, TOT and NT, state owned telecom operators, that have exploited their CLS control to charge high backhaul pricing to the carrier neutral data centers.  The country has three key cable landing stations. Sri Racha, just outside Bangkok, hosts ADC, AAG, and some older cables. In the far South, near Thailand's Malaysian border, a large number of cables land at the Songkhla and Satun cable landing stations. Among the more important high capacity modern cables, AAE1, IAX, and MIST land at Satun. SJC2, AAE1, MVISTA, APG, SEA-H2X, and TIS use the Songkhla CLS. As you can readily infer from the map, backhaul pricing from the South to Bangkok is quite high due to the distance and terrain. The terrai...

AI data centers are extremely capital intensive. Indeed, much more than a standard data center due to the power infrastructure, bare metal servers, and GPUs. But whereas most capital intensive industries have low operating expenses, the AI data center has very high operating expenses as many facilities require hundreds of megawatts or in some cases gigawatts of electricity. So this leads to a high capex, high debt business model combined with high operating expenses. Not to mention, low customer switching costs since AI service providers generally just download their data and models into these bare metal servers and estimate them. Hence, the balance of power generally favors the customer, AI service provider, as opposed to the standard data center model where customers incur very high exit costs. The result are contracts with no penalty termination clauses and 60 to 90 days cancellation notice requirements. In Oracle's case all of its free cash flaw has evaporated due to the immens...

This article shows that if Starlink deploys a massive network consisting of 42,000 1.5 terabit satellites, it yields only 83 megabits throughput per square kilometer. In contrast, ITU 5G standards require 5 megabits minimum per m2. Most 5G networks aim for 400 megabits throughput per kilometer. Moreover, water covers 71% of the Earth. This means that actual user consumptionn will be a fraction of 83 megabits. This in turn pretty much guarantees massive satellite excess capacity, and consequently, long term price wars as the Chinese, Europeans, and Amazon enter the market. The earth's surface exceeds 500 million square kilometers. Moreover, LEO satellites must be evenly distributed in orbit to ensure global coverage. The result is that a 1 terabit down Starlink satellite does not carry as much punch per kilometer as SpaceX enthusiasts and groupies believe. A 42 petabit (42,000 V3) satellite constellation divided by 500 million square kilometers equals only10 bits per meter.  Doesn...

Hi Everyone,  I am available to help you acquire Layer 1-3 network capacity based on your requirements. In general I don't charge procurement fees because the carriers will pay me for any subsequent sales. So if you work with me and you buy, then you will contract directly with the network operator. This ensures you get the best possible price. My value-added is my knowledge of the operators, market pricing, delivery performance, latency, uptime, commercial flexibility, strengths, weaknesses, and the like. I am also good at negotiating deal terms on your behalf.  In a few cases I take a retainer because the client is looking for long term consulting.  You can reach me at roderick.beck@networksourcing.net. I live part of the year in Europe and also in Africa. 

This 24 fibre pair cable connects Mombasa, Kenya to Oman. It is a joint project of META and Safaricom (Kenya's largest mobile provider). Safaricom is the Mombasa landing partner, but META is the cable's sole owner. ASN is the construction partner. Capacity throughput should be a half petabit per second. Safaricom's participation reflects a long term trend for large mobile operators to enter the subsea cable business. Other examples including Vodafone, Bharti, Ooredoo, Axiata, and their subsidiaries. Subsea cable ownership allows mobile operators to expand operations overseas and also reduce the operating expenses for their international voice traffic. Oman is rapidly becoming a subsea cable hub as it offers an appealing alternative to the United Arab Emirates. The UAE's high cross connect CLS charges constitutes backward protectionism designed to shield its two telecommunication incumbents. Secondly, the UAE is simply too close to Iran to be a good place to land or repa...

AI data centers has two challenges: big capex requirements and high operating expenses due to the skyrocketing cost of electricity and the power intensive nature of GPUs. Another challenge is low customer switching costs. A customer like OpenAI or Anthropic rarely puts equipment into an AI data center. It simply downloads its software into the data center's bare metal servers, estimates its model, and then uploads the estimated model back to its own servers. In Oracle's case, it has only one major customer and hence faces huge customer risk. AI data center contracts tend to be soft and often include no penalty cancellation clauses with 60 or 90 days prior notice. This AI data center business model only works if the vendor has access to cheap electricity like hydropower in the Nordics and lots of  customers as oppose to one or two large ones. Solar and wind power do not generally make the grade because their fully loaded pricing is in fact quite high. In the case of Oracle, the ...

Not only do I offer Equiano 100Gs below $20K with you contracting directly with the network operator, but also available are Layer 2 50G protected MPLS circuits on Equiano for $13,500 MRC on two year terms. This allows you to migrate from granular Layer 2 to Layer 1 as your business scales and performance requirements increase. African ISPs need to seize the day before capacity tightens and the window of opportunity closes due to the lack of any new cables for 3 to 5 years.

Singapore currently has 26 operating fiber optic cables. The government is aiming to double that figure over the next ten years. It is also wants to increase residential broadband to 10G, which seems frankly far fetched and perhaps overkill. The biggest drawbacks to landing in Singapore is the limited number of cable landing stations and the congested sea harbor. I would tell the government that it needs more cable landing stations and that they must be physically diverse to the existing facilities. More Malaysian/Singapore terrestrial crossings for Trans-Continental cables, but that conflicts with the sovereignty angle dominating policy making today. https://www.edb.gov.sg/en/news-and-insights/singapore-to-double-capacity-for-subsea-cable-landings-to-enhance-digital-connectivity

1. Fully diverse and fully buried dark fibre pairs or individual strands available for lease or IRU between IColo1, IColo2, Telehouse, Nyali Exchange, Seacom CLS, and 2Africa Shanzu CLS. Unlike other providers, the fiber connects to the data centers via buried conduits. Not power poles. End to end burial. 2. Sixty Euros per kilometer on three year lease deals. 3. New ultra-loss fiber manufactured in 2024. 4. Repair SLA based on 4 hours mean time to repair.

 At the 2026 Submarine Networks World in Singapore Ciena pitched the MOFN business model, the managed optical fiber network. This is a network dedicated to a single customer like a hyperscaler, large enterprise, government, and the like. It involves dedicated fibre pairs and equipment. Very often the customer buys the equipment and ships it to the network operator. It is quite common in Africa where network operators provide such services to the American Tech Giants. But carriers have often found that hyperscaler forecasts of capacity needs are often wildly off. The result is poor MOFN economics and low rates of return.

Ciena seems correct when it asserts massive growth from here to 2035. Heck, that is a 35 year Internet trend. But claiming that traffic will be 85% AI sounds like a very bad forecast. Right now the world is spending $2 trillion each year on AI infrastructure versus $100 billion in AI service revenues. A pretty big gap. We have experienced cycles of excess technology enthusiasm over the last 150 years and bullish forecasts have almost always proved wrong. 

The second Kenyan data center (IXAfrica Nairobi) I've visited with a large Starlink presence. IXAfrica is on Nairobi's outskirts on Mombasa Road and is pretty damn difficult to find as I and the taxi driver learned to our dismay. 😃 Starlink normally requires 20 degrees of line of sight in all directions for its earth stations. A condition clearly violated here. I suspect Starlink is using free space lasers to transmit traffic to satellites high enough in the sky to reach this limited-line-of-sight facility. From my point of view all this talk about Starlink building a parallel Internet infrastructure qualifies as nonsense. It is just another niche ISP using a different and bandwidth-limited Last Mile infrastructure to reach end users. No revolution. Just hype.

Subco announced recently four new 24 fibre pair cables connecting Australia to Japan, Singapore, Guam, and the Continental US. This is obviously a multi-billion dollar undertaking. Now Subco owns the Oman-Australia and SMAP cables. It is also a consortium member on Indigo West and Indigo Central. So I believe Subco has significant retained earnings. Nonetheless, these new cables together probably come close to the $2 billion construction dollar mark. Moreover, hyperscalers don't buy capacity prior to successful execution. Indications of interest, yes, but not contractual commitments. LOIs are soft commitments. So this is a daring undertaking by one of the most successful private operators on subsea cables. For those new to the industry, a private operator generally is a wholesale player that owns an entire cable as opposed to a consortium member or a hyperscaler. However, the historical track record for private operators has not been great. So far Subco has an exception. By 2001, p...

Looks very similar in design to our present fibre optic subsea cable networks. For example, the Red Sea is a telegraph cable highway and Singapore is a telegraph cable hub. However, the Persian Gulf is not important because hydrocarbons won't be discovered there for another 30 years. Note the cable connecting South Africa to Australia, which is reminiscent of Google's Umoja cable. Note the cables connecting Argentina and Brazil to Senegal and South Africa, but Nigeria, a major hub today, has no connectivity.

I came across several instances of dubious subsea cable business models at the conference. 1. For example, one subsea cable startup thinks it can skip equity investments and actually finance its project via debt in the form of bonds. This idea makes absolutely zero sense to anyone with a finance background or experience in the field. The problem with debt is that you must make payments even through your revenues will be zero for several years while the project is executed. Furthermore, it is total crap to claim you will sell capacity IRUs prior to RFS. The simple fact is that sales prior to substantially finishing the project never happen. In the six months prior to RFS sales can happen because carriers can see the project is almost ready. Indeed, that is when the hyperscalers sell capacity. But a debt-financed project needs big IRU deals from the day that bonds are issued. Financial history is quite clear on this point. Telecom infrastructure projects in their early stages are almost ...