2004 Poster Sessions

The private sector of submarine cables started out in the mid- 90's and boomed in the late 90's. The sector collapsed during 2001-2002. This paper will try to assess the chances of the sector's revival in the coming years. Taking into consideration the demand, the identity of potential customers and the financial markets sentiment for the submarine cable industry, the conclusion is that we are unlikely to see purely private systems but rather systems that are controlled by a strategic shareholder that can support and contribute to the system's sales and revenues.

Since SubOptic 2001 in Kyoto, Japan, the telecommunication market has been shaken to its roots worldwide, and the Northwestern Pacific region is no exception. The circuit provision by optical submarine cables greatly exceeds the demand. New cable construction projects are almost nothing since then and the circuit price of existing cables has gone down dramatically. This trend, on the contrary, seems to be a very good chance to establish the international telecommunication infrastructure by the carriers with the future oriented vision. This paper will give an overview of these changes, and discuss the important roles of ship operator to secure the highly sophisticated submarine cable infrastructure.

In the submarine cable market much has been written about technology advances, massive capacity growth and the boom in infrastructure build-out that saw total submarine cable kilometres grow from around 350,000 kilometres in 1997 to around 850,000 kilometres by 2002. However, everything written so far about the cable maintenance market has focused on the more visible economic impact the rapid growth, and even more rapid collapse, has had on the sector. In the submarine cable market what seems to have been missed is what has happened to the fundamental structure of the sector. This paper briefly examines the development of the modern submarine cable market and seeks to demonstrate why and how the author believes the market structure has fundamentally changed.

This paper will detail the evolution of the installation and maintenance markets from the still recent peak of activity to a situation where the installation market diminished to almost nothing (approx 10.000 km on an annual basis) and the maintenance market has been forced into the early stages of what is likely to be a long re-structuring process. The paper will look at how these factors have impacted the marine contractors, the suppliers and the customers. The paper will then look forward to how the market imbalance might resolve itself.

We describe the strategy and motivation for restructuring manufacturing operations and product offerings going forward, in an effort to provide lower-priced undersea bandwidth to customers while maintaining performance, quality, and reliability standards. Consolidating equipment manufacturing operations with existing assets can improve manufacturing efficiencies, exploit economies of scale, and reduce cost and lead time. In conjunction with improvements in manufacturing efficiency, the industry is moving toward new generations of equipment designed to provide the required features with higher levels of integration and fewer components, thereby providing potential benefits in both cost and simplicity. Combined, such efforts position our industry to respond to a lower volume, more cost conscious marketplace going forward. In all cases, we must be diligent to preserve the basic quality culture, specialized skillsets, key people, and core business areas that have enabled our industry to succeed over the years. As the market returns, current and ongoing activities will allow us to "restart the crank" in manufacturing, providing a more attractive product offering to the customer.