TELECOM Digest OnLine - Sorted: Asia Mends Data Cables, Plans Aternative Routings

Asia Mends Data Cables, Plans Aternative Routings

Jon Herskovitz, Reuters (
Fri, 29 Dec 2006 14:35:08 -0600

By Jon Herskovitz

Ships set sail on Friday to mend cables damaged by earthquakes off
Taiwan that cut communication in Asia, while companies found new
routes for their data to flow to prevent another disruption.

Service was back to normal on the last business day of the year with
telecoms companies securing new routes via land and satellite to
restore communication -- ending outages that affected banks and
brokerages from Seoul to Sydney.

In the wake of the crisis, many were wondering how to keep
communication flowing in a world where submarine cables are the
lifeblood of telecommunications and where one glitch can cause global

Communications companies said it might be time to bolster an undersea
network that was built during the telecoms boom of the late 1990s but
where construction has since mostly been dormant.

Financial service companies said they would start the new year by
tweaking their contingency plans with the lessons learned from the

An official at KT Corp., South Korea's top fixed line and broadband
provider, said construction of submarine cable lines had mostly
stalled since about 2000 when the air starting leaking out of the
telecoms bubble.

"Since then there had been little need to build more, until recently,"
the official said, adding that a new line would be built to connect a
booming China with the United States, and this could pave the way for
renewed construction.

While some telecoms firms are considering laying more of the cables
that bunch masses of thin, flexible glass fibers, the process is
costly and requires international cooperation.

Standard Chartered said in a research note the quake had revealed the
increased fragility of financial markets in Asia, where economies rely
heavily on technology and Internet firms to spur growth.

"Losses in telecoms revenue are estimated at hundreds of million of
dollars, depending on how quickly the cables are repaired and normal
traffic restored," it said.

"All in all, the impact should be low, but the risks nevertheless
warrant attention."

Analysts said the disruption had brought increased attention to the
dangers in the region where cable networks run in the same direction,
along earthquake-prone geographic lines.

Telecom operators dispatched or will soon send ships to repair the
cables, with estimates saying they could be fixed in two to three

A banking source in Asia saw no major financial firms dumping their
current providers because of the troubles offshore from Taiwan or any
other drastic changes.

"All the banks have contingency plans. You can't help it if a cable
snaps," the source said. "But we are all going to be reviewing our

(With additional reporting by Rhee So-eui in Seoul)

Copyright 2006 Reuters Limited.

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