Pacific Fibre Finds New Partner: Pacnet

July 28th, 2010 by · 9 Comments

Back in March, a group of investors down in New Zealand started Pacific Fibre, a planned direct link from the country to North America.  There was some skepticism that the effort would get off the ground, but they now have some new backing.  Pacnet, the regional undersea cable operator, has signed on to the team

The price tag seems to have come down more than a little, now estimated at $400M.  The cable will connect Sydney, Auckland and Los Angeles, and will cover some 13,600 miles.  The initial design capacity of 5.12Tbps will be expandable to 12Tbps with 100G technology, though I think it will be a while before they get 100G on a transpacific route.  Low latency is, as usual, a key feature of the new fiber build.

Pacnet’s objective here is probably to achieve another independent transpacific route to go along with its strands on the Unity cable, this time hooking up its markets down under of course.  And, indeed, the partnership will be done similarly to Unity, with Pacnet getting its own fiber to operate in parallel.

The next step will be to find a vendor to build it.

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Categories: Undersea cables

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9 Comments So Far

  • Anon says:

    Yeah, still cynical that this will go ahead.

    • Rob Powell says:

      Well, if they want it badly enough, they’ll find a way to make it happen whether it makes financial sense or not.

  • Josan Leung says:

    Another PacNet news release … after losing AAPT they needed something to say about their orphaned Australia business. Cynically I can’t see how adding PacNet to the mix reduces build costs to this magnitude – they can offer nothing to the partnership in terms of landing stations so what has changed ?

    Another cynic may also question the business case and how they justify this linear build with no obvious interconnect to the rest of their Asia systems.

  • Anonymous says:

    Nice to claim low latency but this cable only serves Australia and New Zealand … I can’t see how a relative handful of potential latency critical applications and clients would justify investing US$200mm in a cable build.

    I would think PacNet would be better to focus on their stalled India cable build where there is real growth.

    BTW :- rumours are strong the PacNet IPO has been postponed indefinitely. They are looking at a private placement to raise additional cash for expansion – I suspect the recent string of commitments by PacNet are designed to lock in some pet projects before a new set of eyes looks over the business development agenda.

  • Insider says:

    As the others predicted in this blog – Pacnet has withdrawn from this project as the economics didn’t make sense.

    I suspect this will be quietly dropped and you won’t see any press release about it.

  • Insider says:

    Unfortunately nothing in the press as yet … there might be something from Pacific Fibre later but usually pacNet only releases good news as it is privately owned and has no obligation to tell the full story.

    Look to their Landing Station to Data Center and AAPT releases … absolutely nothing happened in both cases yet there are no press releases confirming both projects were dropped.

  • Josan Leung says:

    As usual the insider was correct .. the following is just out from Pacific Fibre today and seems this deal died some time ago but, in the usual “PR style” of PacNet, wait for good news before annoucing the (pretty obvious) the end of the hype .. anyone taking bets if the build their joint Bharti cable to India ??

    Pacific Fibre to go it alone

    Earlier this week, New Zealand subsea cable start-up Pacific Fibre revealed it would forge ahead alone with plans to build a cable linking Australia, NZ, Samoa and the US, after Pacnet withdrew from the project.

    Pacnet and Pacific Fibre had intended to split the estimated $400 million cost of the cable, in a partnership announced in July last year.

    But Pacific Fibre CEO Mark Rushworth on Wednesday revealed that the MoU the pair had been working under had expired earlier this year.

    But as he announced an invitation to tender for the cable project, Rushworth said Pacific Fibre had been “assuming a solo-build system for several months now.” He said the project is still on track to be completed by 2013.

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