Apparently, Brazil’s Telebras is quite serious about its plans to build the multi-link system hooking up South America to three continents with big bandwidth. The latest news is that they have found a European partner in the Spanish operator IslaLink. The two have signed a Memorandum of Understanding for the South America to Europe leg, which would land in Portugal.
It was in early March that we first heard of this cable system, and a few weeks later they partnered up with Angola Cables for the leg to Africa. Over the summer we heard that they were still in the relationship building stage, and the MOU with IslaLink is apparently one of the results of that process.
The price tag for the project is still about $900M, for which they’re going to need either a lot more partners or a bunch of government money. There are many cables on the drawing board right now that are promising big bandwidth to South America, each of which seems to be hoping the others will go away.
I’m still looking for a map of the proposed 5 section cable system, anybody seen one? Based on available information, I have assembled a quick combined map of my own for the proposed Telebras system (see left). Quite a project…
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Categories: Undersea cables
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There’s a sudden rash of cable systems seemingly planned by arbitrarily drawing lines on a map (eg the BRICS cable, WASACE …). Who has $1B nowadays to build a cable anyway? Assuming they want to make their money back in 5 years, it implies $200M of sales each year, which at LatAm – US 10G IRU rates in 2015 implies at least 100 IRU 10G wavelength equivalents a year in sales. Is there 1Tb of incremental traffic a year for one cable system out of or into Brazil?
Yes, I think much of the new building talk these days has political roots, not economic ones. The risk is that it distorts the rest of the industry. But on the other hand, I’m not sure the governments are as willing to write checks as they are to draw lines on maps. We shall see.
Agreed on the writing cheques bit. So how do we reconcile these political motivations with the fact that nearly all these cables are being proposed by private investors?
Not necessarily private investors who are putting up much of their own money though… Not yet anyway.