10 thoughts on “Under Pacific, an optical bubble rises”

  1. Hey. After you Americans build undersea cables galore, it is now the Asian’s turn. As they say, trends move in cycles. This time it is move from America to Asia. Yehey! More cheap bandwidth emerging!

  2. Yes, the transpacific build-out is beginning to look like another bubble but there is a key difference: much of the new build is being funded internally by incumbents or major industrial conglomerates. We are not yet seeing the kind of injection of entrepreneurial capital from the financial institutions which was paritally responsible for the irresponsible expansion of the period 1999-2002.

    Also, while a relatively small proportion of the world’s submarine capacity is lit, the surplus is now being steadily eroded in developed markets and new markets such as Africa are beginning to emerge. Moreover, the major routes probably represent only 20% of the total number of routes but these are filling up quickly. Don’t forget that a cable engineer won’t wait until the system is 80% full to begin planning the next system.
    Interesting comments about Infinera. I was struck by the lack of enthusiasm at last years Submarine Networks World conference to discuss the potential for disruptive new technologies in the submarine space. History does repeat itself and DWDM will not be king forever!
    Anyone who has been in this industry for more than 5 years knows that it is cyclical. Expecting investors to behave “rationally” within a 5-year cycle is expecting too much and, as a discussion topic, is a little bit pointless. Like national economies that inflate and deflate, the discussion should be about how we avoid a hard landing in this cycle.

  3. Where are you located? It’s rather easy to argue that the world doesn’t need more bandwidth when you are sitting comfortably in the USA and have more bandwidth than you know what to do with. Go to a different place and the situation looks rather different.

    I am in Thailand and I can tell you that we need that fancy new AAG rather desperately. As you can see from this graph:

    Most content is located in the USA. Good for U.S. based users, but the rest of the world needs international bandwidth, as much as it can get. Count yourselves lucky 😉

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