Pacific Fibre's proposed international fibre link between Australia, New Zealand and the US is necessary for both consumers and the ISP industry due to rapidly growing demand for network capacity, iPrimus CEO Ravia Bhatia has argued.
Speaking to Computerworld AustraliaBhatia said while he didn't see the Pacific Fibre network being financially viable for the time being, growing consumer demand would eliminate any financial concerns by the time the cable is ready in 2013.
"Demand is rising at a rate of four to five per cent a month from end users. That's a stupendous number. By the time the proposed cable is ready in 2013, the existing cables will be close to saturation," he said.
"No matter how much capacity you put out there, it's going to get used up because it will stimulate applications and usage.”
Pacific Fibre, a fibre wholesaling venture led by six New Zealand entrepreneurs, this week released a proposal to build a new 13,000 kilometre trans-Pacific fibre cable. The cable will stretch between landing sites in Sydney, Auckland, Wellington and Los Angeles.
Key motivations behind the new fibre network include providing a lower latency connection between the US and Australia/New Zealand, and providing a lower wholesale cost to ISPs than that currently offered by Southern Cross Cable Network and Pipe International.
The proposal has been criticised as geographically and financially unfeasible by Telecom Wholesale and International CEO Mark Crockett.
In the official Pacific Fibre blog, Pacific Fibre co-founder Lance Wiggs defended the proposed fibre network, saying that ISPs were unwilling to buy more capacity in existing fibre networks as wholesale prices were too high.
"ISPs are unwilling to buy more capacity because the price is too high. And that’s exactly the problem we are trying to solve," Wiggs wrote in a blog entry.
Despite the high price of capacity, Australian ISP Internode this week announced that it had bought more capacity on Southern Cross' US fibre cable.
Pacific Fibre’s Wiggs also defended the proposed network's geographic feasibility, which would determine the latency of the connection between the US and users in Australia and New Zealand.
"Southern Cross’s shortest route from New Zealand is 8,002 km to Hawaii and a further 4,125 km to the USA mainland for a total (excluding land-based cables) of 12,127km. In contrast the direct route to LA or San Francisco from Auckland is about 10,500 km," he wrote.
Southern Cross had not yet linked directly to the US mainland due to a "partner that failed to get the appropriate permits," Wiggs wrote.
"We are aware of these stories and are working with and will always work with experienced campaigners that have been through a few of them. Permitting is very early on our project plan."
According to iPrimus’s Bhatia, international fibre optic connections in the southern hemisphere currently run through Guam, Hawaii or Japan. This causes latency issues, as the cable has to travel a greater distance.
Internode CEO Simon Hackett told Computerworld Australia that in purely technical terms, a direct cable would be marginally shorter.
“At a guess, five per cent shorter than Southern Cross," Hackett said. “That's not going to make a whole lot of difference to end to end latency.”
Bhatia said criticisms against Pacific Fibre from competitors were "self-serving."
“Whenever a new cable is announced, all the major telcos attack it,” he said. “They're going to attack it and try to prevent it from happening.”
By way of example, Bhatia cited the trans-Atlantic TAT-8 fibre optic cable between the USA and England, which was similarly criticised during construction.
Internode and iPrimus have both expressed interest in negotiating with Pacific Fibre once the company is ready to begin wholesaling capacity.
"I wish these guys good luck and Godspeed," Bhatia said.