consequence of the number of islands to be joined and seas to be crossed. But more importantly, it has anticipated a massive future demand for bandwidth between the major Asian centres and between Asia and the rest of the world. And that will only be satisfied by undersea cables. While operators were rewriting their business plans as a consequence of the earlier slowdown that had occurred, it had nevertheless been self-evident that optical fibre submarine cabling would continue to play a major role in telecom infrastructure development in the Asia-Pacific region.
Spotlight on Asia Pacific By Peter Evans For some years, the area of telecommunications infrastructure most in trouble across the Asia-Pacific region has been the struggling submarine cable business. In the late 1990s, companies such as Level 3, Asia Global Crossing and FLAG Telecom constructed a massive amount of capacity with billions of dollars in investments, only to find weakening demand and declining bandwidth prices.
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The market moved into crisis in 2001 and major restructuring began to occur within the
sector. The depressed market persisted even as prices continued to fall. The situation finally started to change in 2006, when a series of new submarine infrastructure projects for the Asia-Pacific region were announced. There were all the signs of recovery in the market with a significant increase in business activity occurring over the 2007/08 period. It is estimated that Asia has been the recipient of about one third of the worldwide investment in submarine cabling. This has been a natural
The general perception of a glut in bandwidth capacity on Asia-Pacific routes also caused some confusion in the market. It was certainly true that investment in submarine cables was no longer bringing the rapid returns it once did. Companies were finding it increasingly difficult to raise capital for undersea cable ventures as a consequence. At the same time, customers of undersea cable operators were finding it difficult at times to get enough capacity on Asia-Pacific undersea routes. Consequently operators built the largest possible cables to meet demand and gain a cost advantage over competitors. A combination of sluggish global and regional economies conditions, the perception of overcapacity on some routes, and questions about the level of return on investment inevitably saw a slowdown in the construction of submarine cables in the region. The oversupply of submarine cable capacity in the region has been in the intra-regional networks rather than in the large regional and trans-Pacific cables. A significant number of new intra-regional cables have come into