Leighton spins off submarine project, signs Alcatel-Lucent

Updated: Newly formed subsidiary to undertake two year, 4800 kilometre build to Singapore
Leighton spins off submarine project, signs Alcatel-Lucent

Leighton Contractors (ASX:LEI) has pushed forward with plans to build a new submarine cable link between Perth and Singapore, with plans to have the cable operational and feeding up to 16 terabits per second (Tbps) of capacity by 2013.

A detailed design and route survey is currently underway by newly formed subsidiary Australia-Singapore Cable (ASC) ahead of final board approval. Construction is expected to begin on the link in the first quarter of next year with operation by 2013.

ASC chairman and Leighton Telecommunications executive general manager, Peter McGrath, told Computerworld Australia the cable would primarily be funded through 15-year pre-commitments to "major domestic and international customers" with a key focus on financial services and telco players. The link would likely cost less than $200 million.

Alcatel-Lucent has been signed to provide D+ fibre equipment for the link for an undisclosed sum. The link would initially be capable of 6Tbps transmission but could be almost tripled to 16Tbps based on 100 gigabit per second (Gbps) technology trialled by Alcatel-Lucent and Nextgen networks last year.

The international link was first flagged by Leighton subsidiary Nextgen at the beginning of last year, as an 8000 kilometre connection between Perth and Jakarta in Indonesia, capable of 2.56Tbps transmission speeds. The project has since been spun off under ASC and altered to become a 4800 kilometre link to Singapore.

The new international backhaul will boost capacity to Nextgen’s local terrestrial network, and will terminate at a new data centre to be built in Perth by another Leighton subsidiary, Metronode.

Latency on the cable is expected to average 28 milliseconds between Perth and Singapore on the cable, totalling 48 milliseconds to move data from Singapore, over the ASC cable and to Sydney on Nextgen's network.

Alcatel-Lucent most recently worked with Nextgen networks to provide equipment for the Federal Government’s $250 million Regional Broadband Blackspot Program, under a $40 million contract with the telco vendor.

Nextgen chief executive, Phil Sykes, refused to comment on the deal ahead of its announcement, but said previous plans to assess the capability for a new link between Australia and Singapore were on track.

The cable itself will likely form competition to existing local cable operators Southern Cross and TPG-owned Pipe Networks.

Pacific Fibre, a $US400 million submarine venture led by New Zealand entrepreneurs, is aiming to link Sydney, Auckland and Los Angeles with a 13,600 kilometre cable of 5.12Tbps speeds by 2013.

Research firm Telegeography estimated investment in submarine cables would peak at $2.8 billion during 2011 over fourteen new cables, with eleven scheduled for build next year.

"We don’t see to date any competition that can offer that capability," McGrath said. "There’s plenty of cables going to the US or have been and are being announced but a number of the large global customers are looking for what they call a southern route that will provide a redundant path from Singapore, down through Australia across to Sydney and off to the US. This cable provides that redundancy for these global carriers that are looking to back up their global tracking."

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