SYDNEY, Australia - Despite Asia's shaky economies and plunging financial markets, one group isn't shying away from investment in the region: international telecommunications companies.
Between now and 2000, they'll be dropping upward of 160 gigabits-per-second of fiber-optic cable capacity to the bottom of the Pacific Ocean linking California, China, and Australia with hugely-expanded speed-of-light communications.
In the past month alone, two major cable projects have been approved. Dubbed Southern Cross and the China-US Cable Network, the projects will involve laying on the ocean floor thousands of miles of 20-Gbps cables � the world's biggest, fastest pipes.
While final decisions over how many cables to lay haven't been made yet, each new cable will dwarf the capacity of existing trans-Pacific warhorses, an overworked collection of four 5-Gbps cables and a smattering of lesser pipes.
The new 20-gigabit cables mark a brave show of confidence about the anticipated future growth of voice and data transmission in Asia as the region develops and Internet and data traffic rises.
For its part, the 18,000-mile circular China-US Cable Network project will represent the first direct fiber-optic link between China and the United States. For China, the cable will be laid as the nation's phone use booms.
In the past two years, the number of phone lines in China has risen 215 percent � and the number of households with telephones should rise from 7 percent to nearly 30 percent to 40 percent in urban areas by 2000, predicts Seth Blumenfeld, president and chief operating officer of MCI International.
The China-US Cable Network is expected to cost about US$1 billion, and will be owned by a 14-member consortium of equal stakeholders that includes AT&T, China Telecom, Hong Kong Telecom, Korean Telecom, Nippon Telegraph & Telephone, Telekom Malaysia, and Australia's Telstra.
Cables for the project will be laid from San Luis Obispo, California, to landing stations in South Korea, Japan and China, and should be operating by late 1999.
The Southern Cross project, another 80-gigabit project, is also expected to cost around $1 billion, and will be laid between California, Hawaii, New Zealand, and Australia through a partnership of WorldCom, Telecom-New Zealand, and Australia's Optus Communications.
The partnership is the product of a whirlwind three-day meeting in Sydney in November that drew 41 companies interested in the project. Amanda Wallace, spokeswoman for Optus, said 29 firms signed up for capacity on the spot and more have signaled they may join the effort. Cable-laying ships are expected to begin work as early as March.
The Southern Cross project is a dramatic demonstration of the growing hunger for direct, independent access to the global telecom network. For example, in Australia's newly deregulated telecommunications sector, companies now competing against one-time monopoly Telstra in markets such as long-distance and Internet access pay Telstra for access to its trans-Pacific cable to the United States. Those payments hurt, and owning transmission capacity was a major reason Optus became a major player in the Southern Cross project, Wallace said.
