We may have a new cable to Hawaii

Stuff reports:

An announcement by Alcatel-Lucent that it will lay a new subsea communications cable between New Zealand and Hawaii needs to be taken with a “grain of salt”, until more details are known, the Telecommunications Users Association says.

Alcatel-Lucent Submarine Networks said it had signed a contract with Bluesky Pacific Group, a subsidiary of Spanish telecommunications firm Amper, to lay a 9700 kilometre cable connecting New Zealand, Hawaii, the Cook Islands, Samoa and American Samoa, by 2018.

Telecommunications Users Association chief executive Craig Young said the venture appeared to have come out of the blue. 

“We have always wanted another cable up to the United States, but no-one else has managed to make the business case stack up,” he said. 

Alcatel-Lucent was not immediately able to confirm details of the contract, such as what had been agreed, the cost or any conditions.

Young said people should not get too excited the cable would definitely be built, until there was more information. 

If this is really happening, it is great news.

But it is out of the blue. Normally a company announces an intention, and then spends a few years trying to gain enough customers and finance to make it viable.

However Alcatel-Lucent is huge and can finance it themselves, so maybe they have decided to proceed without guaranteed customers.

Alcatel-Lucent’s statement did not indicate whether Bluesky yet had confirmed customers for the cable or regulatory approval for any landing stations.

Financing trans-continental communications cables is usually a multi-year process that involves stacking up advanced sales to customers on a condition a cable is built, and obtaining loans and equity investment.

If the cable is a firm commitment, and not dependent on signing up customers, then it’s real and that is great news.