New undersea cable line seen sending telecom rates down

Hanoi Times – Telecommunications charges will go down further when the first high-bandwidth optical fiber submarine cable system invested by a multinational consortium to link Southeast Asia region directly to the United States goes o­nline this year.

Nguyen Huu Khanh, managing director of Vietnam Telecom International (VTI) under the Vietnam Post and Telecommunications Group, implied telecom rate cuts by some 20% when the cable line is operational in the fourth quarter of this year.

Khanh emphasized the importance of the Asia-America Gateway (AAG) that takes US$ 90-million investment of Vietnamese companies including the group as it will be the first cable system to connect Vietnam directly with the U.S. in addition to helping to drag down telecom rates.

Khanh said the cable systems have been under the management of VTI such as TVH had links to Asian destinations in Hong Kong, Thailand, Singapore and Japan. The company still has to lease lines to connect these systems to the U.S.

"So, there has not been not any direct cable link between Vietnam and the U.S., and indirect connection pushes up investment and charges," Khanh said. "The AAG will fix this and certainly bring in lower charges to customers."

Khanh said the AAG connected with Vietnam in Vung Tau would meet the increasing demand, especially for the Internet boom in Vietnam as its capacity was large. "Retailers and wholesalers can lease lines for their services within 15 years."

Khanh told the Daily that VTI was mapping out a charging plan for wholesalers and retailers who will be allowed to use their leased lines for their own services as well as sale and lease to corporate and individual customers. "Good quality and reasonable rates are our goal."

Khanh said the AAG capacity for Vietnam was 240 Megabits in the initial time and 960 Megabits after that which can meet the demand in Vietnam until 2015. "We will ask for more capacity depending o­n the percentage of investment capital contribution."

Khanh predicted Vietnam would in more cable system projects in the future as the demand for information and communication technology at that time would be enormous. He added that more systems would provide more choice and secure links to the world. "Uninterrupted connection is very important."

The AAG cable system is estimated to cost US$ 500 million or more, which is contributed by the consortium members including AT and T of the U.S., British Telecom, Thailand's CAT Telekom, Australia's Telstra, TELKOM Indonesia, Telecom New Zealand, Telekom Malaysia, Saigon Postel Corp., Vietnam Post and Telecommunications Group, and Viettel of Vietnam.

Khanh said Vietnam was o­ne of the 10 founding partners of the AAG and contributed the idea for the cable system in 2004. "We have been in discussion for many times and contributed investment to the project."

The cable system spans 20,000 kilometers connecting Singapore, Malaysia, Thailand, Brunei, Vietnam, Hong Kong, the Philippines, Guam, Hawaii and the U.S. West Coast. It will also establish seamless interconnection with other regions like Europe, Australia, Africa and other parts of Asia.

The cable system is designed to provide a capacity of up to 1.92 terabits per second of data bandwidth to meet the increasing need for faster and more reliable Internet, video, data and other multimedia services. But, the system will initially have a capacity of 480 Gigabits per second when it goes o­nline in December this year to meet present and future needs for telecommunications services.

The low-risk route is expected to provide an alternative and more secure link between Southeast Asia and the U.S. and complement existing networks like the APCN2 and the Japan-U.S. Cable Network.