Consortium members AARNet (Australia's Academic and Research Network), Google, Indosat Ooredoo, Singtel, SubPartners, and Telstra have selected Alcatel Submarine Networks (ASN) to build the INDIGO undersea cable system that will link Singapore, Indonesia, and Australia. The 9,000-km submarine cable system, originally named APX West & Central, is scheduled to be in finished by mid-2019.
The network will have two fiber pairs but will have a minimum capacity of 18 Tbps, thanks to the use of coherent transmission technology. The system will run from Singapore to Perth, then to Sydney; another two-fiber undersea cable will connect Singapore with Jakarta via a branching unit. The submarine network will land in existing facilities in all three countries.
The system's backers see INDIGO as necessary to increase connectivity between Australia and South East Asian markets via a submarine fiber network that provides lower latency and improved reliability. The ownership agreement calls for each backer to own its own spectrum on the system, enable each to upgrade its spectrum independently as necessary.
"With internet data consumption growing by 70% in Asia last year alone these sorts of investments in international networks are critical for meeting the needs of connected consumers and businesses," explained Telstra's Group Managing Director of Global Services and International David Burns. "This will be an important piece of technology infrastructure connecting South East Asia and Australia, and follows a number of recent network enhancements Telstra has undertaken to meet growing demand for data and better connectivity from our customers across the Asia Pacific region."
The consortium's makeup will change slightly with news that Superloop Ltd. (ASX: SLC), an independent provider of digital services in the Asia Pacific region, has reached an agreement to buy SubPartners. The agreement calls for Superloop to pay $2.5 million in stock for its new assets. However, Superloop must get shareholder approval to issue the stock to Bevan Slattery, chairman and CEO of the Superloop Group, who also happens to own 80% of SubPartners' issued capital. If that approval isn't forthcoming, Slattery will receive $2 million in cash.
As part of the sale announcement, Superloop provided insights into how much it will have to pay for its piece of the INDIGO undersea cable system's construction and initial maintenance. Superloop says that SubPartners is on the hook for between $35 million and $37 million from FY17 until FY20. However, as SubPartners is responsible for the procurement, provision, operation, and maintenance of the shore-end infrastructure at the landing site in Sydney, it also will receive approximately $5.3 million in fees from the INDIGO consortium across FY17 and FY18.
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