Content Providers Expanding Frontiers
Expect to see content providers increasingly drive long-haul network development across all global routes.
Content providers initially focused their route development on major inter-hub routes, which was reflected in heavy investment in trans-Atlantic, trans-Pacific, and intra-Asian routes. They’ve since expanded their footprints dramatically, and their investments now include new systems linking all global regions, including Africa, the Middle East, India, Oceania, and Latin America.
In 2024, Google announced its Pacific Connect Initiative, a collection of cable systems crisscrossing the world’s largest ocean. The earliest of these systems will enter service in 2026, with others coming online as they are completed.
Although this initiative does not represent Google’s only recent cable investments, it represents a massive chunk of capacity and capital. The cost of these systems is well over $1 billion. Notably, Google is receiving some financial support from the U.S. and Australian governments for these projects, largely to enhance connectivity to islands in the South Pacific
Meta’s Project Waterworth is another vast and ambitious plan to reach new markets. This group of planned cables will form a loop around the globe, though detailed landing and routing have not yet been made available.
Locations of Data Centers and Power Optimization
Network optimization will drive long-haul bandwidth growth across routes linking data centers.
Operators are beginning to redistribute computing workloads across data centers to optimize power consumption and processing capacity, a strategy known as “spatial temporal load shifting.”
Google, for example, leverages its global network to shift workloads based on the real-time availability of renewable energy. As other companies adopt similar strategies, locations with abundant renewable energy options will likely become prime targets for future data center and network infrastructure development.
These will add to bandwidth demand on a growing intermeshed network of global data center-to-data center routes that prioritize both access to end users and access to compute and storage resources.
Geopolitical Concerns
Geopolitical tensions will directly affect the timing and location of subsea cable deployments.
While geopolitical concerns have always played a role in determining which companies deploy long-haul networks (and in which locations), several recent developments are reshaping network deployment trends.
The Red Sea currently faces major problems. Competing Yemeni territorial claims have created a permitting nightmare for cable laying vessels attempting to operate there, and Houthi attacks on shipping lanes have manifested a physical threat to operations. The massive 2Africa cable, which is largely laid, has yet to realize deployment of a large length of cable that would lie in Yemeni waters. Other cables planned to traverse the Red Sea in coming years include IEX, Africa-1, Raman, and SeaMeWe-6, which are also awaiting deployment.
Cable repair operations have been threatened in the Red Sea as well. The simultaneous cable faults on AAE-1, EIG, and SEACOM/TGN-Eurasia off the coast of Yemen in late February 2024 resulted in five months of delay before maintenance vessels were able to conduct repairs due to the threat of Houthi attacks on shipping.
These problems in the southern Red Sea are spurring efforts to develop terrestrial bypass solutions from the Saudi Arabian Red Sea coast across to the U.A.E. and Oman.
Beyond the Red Sea, cable builders are finding it increasingly difficult to receive Chinese permits for new cable deployment in the South China Sea. The ADC intra-Asian cable finally entered service at the end of 2024. The SJC-2 cable should finally enter service in 2025 after multi-year delays. (SJC-2 was originally planned to be in service in Q4 2020!)
These challenges of laying cables in the South China Sea are leading operators to develop new routes. The builders of the planned Apricot cable aim to avoid this problem by laying the cable from Japan to Singapore via a route to the east of the Philippines. In addition, U.S. government opposition to direct China-to-U.S. cables has boosted the development of several cables from Southeast Asia to the U.S. These include Echo and Bifrost.
Artificial Intelligence (AI)
AI will contribute to shifts in traffic patterns—not just locally—but also in the long-haul.
There’s hardly a hotter topic in the network world right now than AI. Just as the broader economy braces for the massive but unknown impact of this technological development, we have to ask what kind of effect AI will have on the transport network.
In the U.S., terrestrial fiber providers Lumen and Zayo have both cited AI-driven demand as justification for laying new fiber. Lumen has touted big deals with Google, Meta, Amazon, and Microsoft for metro and long-haul fiber.
The impact of AI on network traffic extends far beyond the networks of major hyperscalers. AI-driven traffic is increasingly interwoven with traditional traffic streams carried across all carrier networks. New AI-focused companies may emerge that seek to build their own network infrastructure.
In conclusion, while it’s clear that AI will significantly influence long-haul network demand, the precise magnitude and nature of this impact remain uncertain. The rapidly evolving model training techniques and inference deployment strategies make it challenging to predict the future.
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