Subsea Cables & Internet Infrastructure

Hollow core transmits light via a central air filled tube in the fibre optic strand versus solid ultra-pure silicon. The benefit is 50% less latency which brings it within 1% of light's maximum speed. High attenuation bedeviled this technology's earliest incarnations as light would bleed and escape through the cladding. A founder of Lumenosity, the preeminent hollow core manufacturer, stopped light bleeding using a reflective layer made of silver. Photonic bandgaps are also used for the same purpose. The fibre offers several performance advantages over traditional solid core fibre: 1. Lower latency since light travels 50% faster via air. 2. Air generates less chromatic dispersion than glass. Chromatic dispersion involves the different frequencies making up a light pulse moving at different speeds. This causes a pulse meant to occupy one time slot to spread and occupy multiple time slots. The data is corrupted. 2. Less nonlinear distortions such as 4 wave mixing, stimulated Bril...

1. Senegal is really hard because several 2African consortium members decided to exclude it from their footprint. But subsea capacity demand is significant because Dakar is a natural telecom hub due to its location along the Northwest African coast. I am working on getting a good subsea 2Africa solution for African ISPs for whom Dakar is part of their plans. 2. If you planning to lease subsea capacity into South Africa or Lagos, best to wait a few months for 2Africa to go live. The combination of 2Africa and Equiano will create a temporary glut. That's the time to strike. 3. I recommend African consortium members on the Equiano and 2Africa cables over their foreign counterparts (Trump will be complaining I am discriminating against white people😄) because they have larger metro footprints. Metro waves are extremely expensive in African cities. It is likely that you can negotiate a subsea deal with an African carrier that eliminates or sharply diminishes any metro charges. I just di...

1. The intra-Asian APG cable has been down for an entire year. Forecast is that it will go live again end of April. 2. Bombing the Houthis is unlikely to get resolve the Red Sea impasse. Air power alone is generally ineffective. Military history says change requires boots on the ground. Indeed, most likely outcome is that the US bombings will delay any resolution. Expect futher delays for 2Africa, Blue-Raman, and SWM6 RFS dates.  3. Got 100G AAE1 wavelength capacity on non-express route for Marseille/Singapore. Available below $25K MRC per month. Big Chinese social media buyer Tiktok looking to take 10x 100Gs on same cable. So you better hurry or end up empty handed. 🙂

Latency: Under 63.3 ms RTD. A point: Singapore CLS. Z point: Maruyama CLS, Japan. Service: 100G Wavelength. MRC: $15.5K. Term: 1 Year. APG has a very short subsea path from the all-important Japanese financial exchanges to their Singapore counterparts. It enjoys lower latency than ASE. But uptime has been poor so you will need redundancy on a physically diverse cable. This is challenging because Pacific Rim cable landing stations often serve a multitude of subsea networks. A typical CLS may be home to as many of 8 cables or more. I can help you in designing your trading and market data networks.

The East Africa capacity shortage is real and chronic. A cable serving the East Coast recently upgraded its network, but sold almost everything before the upgrade was complete. The 100G prices along the coast vary from $35K to $110K per month depending on end points. Not exacly cheap. Peace is not helping ease the crunch as the Chinese carriers are not providing leases into Kenya, but instead offering just IRUs. This eliminates most of the market as the capital required is simply too great for most players except PTTs, OTTs, and mobile carriers. The 2Africa cable is simply insufficient as Facebook kept 4 fibre pairs for itself leaving only 12 pairs for carriers' internal traffic and wholesale sales. The only other significant cables serving the Coastd are Eassy and Seacom. Neither is really high capacity by today's standards. Furthermore, 2Africa's Marseille/Mombasa segment may not be ready until 2026 given Red Sea hostilities. So regional ISPs have little choice but to hau...

1. The eternal East African capacity crunch with 100G pricing ranging from $35K to $110K leads to a new East African cable being announced in quarter two or three of this year. Thanks to Mark Tinka for this brave, but plausible prediction. Peace has proven to be a disappointment for East Africa with capacity owners focusing on selling IRUs into Kenya. 2. In 2026 a consortium decides to build a new West African cable as 2Africa is hopelessly inadequate in terms of footprint and capacity. Facebook is using 4 pairs for its own traffic leaving only 12 pairs for the rest of the market. But 4 pairs is not enough for Facebook's own long term needs. 3. Africa-1, SWM6, and Blue-Raman are all delayed into 2026 due to the threat of Houthi attacks. 4. The collapse of the AI speculative binge begins second half of 2025. AI disappoints because large language models are not capable of logical reasoning nor can they distinguish truth from falsehood. Lack of applications leads to too much money cha...

I am trying to estimate Starlink's total annual depreciation. The reason is quite simple. These LEO satellites have five year life spans. Five years is very short. So depreciation is quite high. Each year a fifth of the fleet is retired. This means depreciation is high relative to revenues and also the steady state capex is quite large. Most telecom infrastructure enjoys a longer life span. The depreciation rate is a bit scary in my opinion.  Starlink had  5,200 operational satellites in May 2024. Construction costs vary from $200K for the earliest models to $800K for the more powerful recent models just being deployed. Let's figure $500K is the average weighted construction cost. Then annual depreciation is roughly $520 million per year.  Right now all you read in the press are good things about Starlink financials. But a private company intending to IPO generally only discloses flattering news. So far we have only been told revenues are in the billions and that the comp...