The US$300 million Southern Cross NEXT cable has been given the regulatory green light to begin construction, with Telstra also receiving the go ahead in its bid to take a 25 percent stake in the company.
The 13,483km cable, due for completion in January 2022 and connecting Australia, New Zealand, Fiji, Tokelau, Kiribati and the US, is designed to carry 72 terabits per second, providing what Southern Cross says will be the lowest latency pathway from Australia and New Zealand to the US.
The cable adds to the existing 20Tbps of capacity on the current Southern Cross systems.
Alcatel Submarine Networks (ASN) has been contracted to build the cable which is based on an Open Cable architecture, with a Contract in Force now granted.
Laurie Miller, Southern Cross president and CEO, says the new route will provide further resilience and connectivity options between Australia, New Zealand and the United States. It will also provide a key interconnecting infrastructure for the South Pacific, providing FijiA, Tokelau and Kiribati with a direct pipeline, and offering greater options for Vanuatu, Samoa and Tonga.
Telstra joins Spark New Zealand, Singtel and Verizon as shareholders and will be an anchor customer of the NEXT cable. It’s shareholding sees Spark’s shareholding drop from 50 percent to 37.5 percent.
Michael Ebeid, Telstra enterprise group executive, says the cable will benefit customers from enterprise to wholesale and consumer.
“With 80 percent of all the internet traffic to Australia coming from the US, a high speed, low latency direct route to North America is a very important investment for our business and our customers,” Edeid says.
“Southern Cross builds on our existing footprint across Asia Pacific where we carry 30 percent of the region’s active capacity.”
Spark told the NZX it expects to contribute between $70 million and $90 million of equity across FY20-22
A marine survey was completed in 2017, with Sydney BMH and bore landing facilities completed in 2018 along with landing arrangements in Los Angeles and Auckland.
The system was initially expected to go live in the second half of 2021.
In May, the 36Tbps Indigo subsea cable, connecting Sydney and Perth with Jakarta and Singapore was lit up. That cable is a partnership between Google, Telstra, Singtel, AARnet, Indosat and SubPartners.