Telcos form consortium to build undersea cable network

from Zawya..

April 30, 2013, By R. Jai Krishna and Jason Ng

Telcos form consortium to build undersea cable network

Photo Credit:Reuters/Ho New

A consortium of six telecommunication companies has been formed to build a submarine cable system linking Malaysia, Singapore, India and Sri Lanka to the Middle East, which could boost data connectivity significantly in the region as operators expand their data offerings to boost earnings.

Telekom Malaysia Bhd (4863.KU), Vodafone Group PLC (VOD.LN), Oman Telecommunications Co. (OTEL.ON), Emirates Telecommunications Corp. (ETISALAT.AD), Reliance Jio Infocomm Ltd and Dialog Axiata PLC (DIAL.SL) will jointly set up the so-called Bay of Bengal Gateway system that will span about 8,000 kilometers, according to a statement issued by the companies Tuesday.

“The construction of Bay of Bengal Gateway is planned not only to provide connectivity between South East Asia, South Asia and the Middle East, but also to Europe, Africa and to the Far East Asia through interconnections with other existing and newly built cable systems landing in India, the Middle East and the Far East Asia,” the statement said.

The system, which is expected to start carrying commercial traffic by the end of 2014, will link Malaysia’s Penang city and Singapore to Oman and United Arab Emirates in the Middle East, with the Indian cities of Chennai and Mumbai, and also with Sri Lanka.

The participation of Reliance Industries Ltd.’s (500325.BY) telecom venture Reliance Jio comes as it is preparing to launch high-speed communication services based on fourth-generation, or 4G, technology in India.

Earlier this month, Reliance Jio Infocomm signed a pact with Bharti Airtel Ltd. (532454.BY) to lease data capacity on its undersea cable system–Network i2i Ltd.–and also with Reliance Communications Ltd. (532712.BY) to share its fiber-optic networks within the country.

Reliance Jio Infocomm, as well as other companies, didn’t provide any financial details or their share in the consortium.

The cable “will also serve as an extraordinary opportunity for business growth as it will help supporting current and future high capacity requirements from the surrounding areas of the region as well as next generation Internet applications,” the statement added.

Write to R. Jai Krishna at krishna.jai@dowjones.com and Jason Ng at jason.ng@dowjones.com

Link to the article:  http://www.zawya.com/story/Telcos_form_consortium_to_build_undersea_cable_network-ZW20130430000037/?lok=095718130430&weeklynewsletter&zawyaemailmarketing

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