The telecoms networks business, which sparked the first major bubble of the 2000s, is experiencing a resurgence. According to new data from TeleGeography’s Global Bandwidth Research Service, international bandwidth usage grew 64% in 2008.
The sustained rapid growth in bandwidth demand is spurring a wave of network expansion: more than 60% of US network operators surveyed by TeleGeography plan to light new fibres on their network in 2009. At the same time, the submarine cable industry is experiencing a flurry of new projects that is reminiscent of the early part of this decade: telcos plan to lay 16 new undersea cables in 2009, exceeding the number of cables laid in 2001, the peak of the submarine cable investment bubble.
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'While the number of cables being laid is impressive, this current batch of new cables won't break the bank,' says TeleGeography analyst Alan Mauldin. 'Most of these new cables cover shorter distances and employ simpler designs than their predecessors, helping to keep costs in check.' Total spending on submarine cable construction in 2009 is projected to reach USD2.6 billion, a small fraction of the USD13.5 billion invested in new systems during the 2001 building frenzy.