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Would Google Cable Affect Bandwidth Costs?

TeleGeography says Google could contribute to a "pricing collapse" for trans-Pacific submarine fiber.

The telecom research firm TeleGeography has posted data on the market for trans-Pacific submarine communications cable, providing some context for reports that Google is planning to invest in a multi-terabit Pacific cable. Some interesting trends:

  • Trans-Pacific bandwidth demand has soared in recent years, growing 41% between mid-2006 and mid-2007.
  • Planned upgrades and new cables will boost lit trans-Pacific submarine cable capacity by 120% to 7.2Tbps by the end of 2008.
  • The lease price of a 10Gbps wavelength circuit across the Pacific is more than ten times greater than comparable capacity across the Atlantic.

If Google invests in additional trans-Pacific capacity, it could accelerate a major shift in pricing for bandwidth to Asia, according to TeleGeography analyst Alan Mauldin. "In the face of so many new cables, the trans-Pacific market is in danger of a price collapse similar to that which has plagued trans-Atlantic cable operators," said Mauldin.

But what's bad for telecom cable operators maybe good for content providers, reducing the cost of serving up bandwidth-intensive files and applications to Asia.

We also applaud the TeleGeography staff for their headline: "Yarrr! Google enters the trans-Pacific submarine cable market." While the item is dated Sept. 24, it was clearly written in the spirit of last week's annual Talk Like A Pirate Day.