Several major fiber-optic undersea systems to be cut over in '04 and '05, KMI reports

April 16, 2004
April 16, 2004 Providence, RI -- Deployment of fiber-optic undersea networks will rise in 2004 and 2005, following a relatively barren year in 2003, contends a new database update report from KMI Research.

April 16, 2004 Providence, RI -- Deployment of fiber-optic undersea networks will rise in 2004 and 2005, following a relatively barren year in 2003, contends a new database update report from KMI Research.

Three major systems are likely to be cut over within the next three years: the 15,000 FLAG/Reliance FALCON system (Egypt-India-Hong Kong); the 22,000 Polarnet system (UK-Russia-China-US); and the 20,000 SEA-ME-WE 4 (France-Singapore).

Fiberoptic undersea system cutovers will rise from about 3,800 route-km of in 2003, to 16,800 in 2004. Systems cutovers will rise again in 2005 to 19,300. Still, undersea deployments in each year will represent only about 10% of the 2001 peak annual deployment of 188,600 route-km.

Over the past two years, the undersea industry has gone through the turmoil of restructuring. Financially distressed systems owners have sold undersea assets at a fraction of their investment cost, which provides their new owners with an attractively competitive cost basis. This trend has discouraged deployment of new submarine systems. Nevertheless, since publication of the August 2002 Fiber-optic Undersea Systems (FUS) database, KMI has added 35 systems to the database.

The database also contains a large group (nearly 300,000 route-km) of systems that do not have a firm cutover date. Only a small fraction of these systems will ever be built.

The KMI FUS update highlights several other trends:
• Despite the market collapse and a trend toward building smaller systems, average fiber counts are increasing.
• Although total annual cutovers will rise from 2004 to 2005 when measured as route-km, the estimated project value will fall during the same period.
• India is a central spot for many undersea systems planned from 2004 onward.

The April 2004 KMI FUS database contains more than 900 records for 418 named systems deployed since 1982. The database records information for each system on landing points, network length (route-km), fiber count, fiber deployed (fiber-km), number of wavelengths, maximum capacity, investment cost, and several other parameters.

For a more information, visit www.kmiresearch.com.

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