Subtel, Huawei Exploring Possible Chile-China Fibre Link

Chilean communications regulator Subtel has signed an agreement with Huawei to explore the viability of installing a direct underwater fibre-optic cable link between Chile and China. The technical feasibility agreement was signed by Chile’s undersecretary of telecommunications Rodrigo Ramirez and Huawei’s country manager Dong Xiaozhou and will analyze the possible routes and cost of the Pacific Ocean subsea link. Ramirez is due to travel to China this week to discuss the project with other potential interested parties.

The deal comes after Huawei last year committed to installing a regional ICT innovation centre in Chile as part of a technological transfer MoU signed with the country’s government. The Chinese company has also expressed an interest in taking part in the forthcoming 'Fibra Optica Austral' tenders to roll out 3,000 km of fibre-optic infrastructure in the southern Patagonia region.

Source: telecompaper.com

ANALYSIS: If built, this 20,000 km cable would be one of the longest submarine fiber optic systems in the world and would complete Chinese encirclement of the globe with fiber as part of its “One Belt, One Road” initiative.

It is easy to say that there is no business case for this proposed cable. Chile’s demand for content is mainly Hispanic and English. There are no transpacific connections to Chile. All fiber is oriented towards the rest of South America, the Caribbean, and the USA. However, the “SAIL” project (Cameroon-Brazil) continues to be developed despite the lack of any clear commercial benefit, thanks to Chinese funding and political will. The same may apply to this ambitious proposal to connect Chile to China.

The submarine cable would be supplied and installed by Huawei Marine (HMN), a joint venture between Huawei and Global Marine Systems Ltd. of the UK, but HMN’s parent would be supporting the project with its other investments in Chile. Furthermore, HMN has its eyes on the “Cable Austral” project which envisages the construction of a domestic submarine fibre optic cable system from Northern Chile down to the South. There are thus plenty of reasons why Huawei would take on this feasibility study, even if Chile-China is not part of “One Belt, One Road”.