Alcatel: Project Solves Area's Capacity Needs for 5 Years

The Eastern Caribbean should have sufficient international capacity for the next five years upon completion of a new submarine cable in the area, according to French equipment supplier Alcatel (NYSE: ALA).

Alcatel and Global Caribbean Network (GCN), a subsidiary of Group Loret, began installing the new network in February, eventually laying 890km to connect Basse-Terre and Pointe-à-Pitre in Guadeloupe to San Juan in Puerto Rico.

The project will also link up St Croix in the Virgin Islands and the St Martin and St Barthélemy islands.

The first phase of the project will be completed in June and have an initial installed capacity of 20Gbps and a potential capacity of 100Gbps, Georges Krebs, chief operating officer for Alcatel's submarine networks activity told BNamericas.

According to Krebs, a parallel project being installed by competitor TS Crossing will connect Barbados, St Lucia and Puerto Rico, also leveraging connectivity to St Croix.

The two new cables will combine with the only existing inter-island infrastructure, the ECSS system, which is of low capacity and tightly controlled by incumbents, Krebs said. As such the ECSS has impeded development in the Eastern Caribbean, he added.

"It could be argued there will be too many cables. But as long as there are two networks that complement each other, I think it makes sense. Beyond that I think it would be premature to consider anything more... I think that for the next five years it should be sufficient in the Eastern Caribbean region."

URGENT NEED FOR CONNECTIVITY

According to Krebs, the prime drivers for installing this infrastructure are the growth in mobile phone communications, the need for competition and the need for operators to access international networks.

Secondly there is the increased need for fast internet services at prices on a par with other parts of the world.

"The dream of Caribbean governments is to provide access at more or less the same price as in Europe. This is very difficult to achieve given the difficulty to connect to the network," Krebs said.

"If you want to do that via satellite or via existing cables, it is very expensive. The existing low capacity cables are relatively old and the incumbents that control them may not always want to provide cheap capacity to their competitors," Krebs added.

The third factor is the opening up of Caribbean economies, but this depends on the first two, particularly the need for fast, reliable and cheap communications to compete in global markets.

FUTURE PROJECTS

The GCN and TS Crossing networks leave room for further penetration in the region since Haiti and Cuba have yet to join them. These projects are being discussed, according to Krebs.

"Generally the other islands need either more modern cables or competition. They need an alternative to the existing cables," Krebs said.

This will be true in Guadalupe and Martinique where GCN will compete with France Telecom (NYSE: FTE). In fact, GCN is likely to receive local support, as those governments are very keen to see access at much lower rates.

Another potential competing project in the Eastern Caribbean is being examined by US undersea cable operator Trans-Caribbean Cable Company (TCCC). TCCC's president Brian Crawford told BNamericas in January that the company had started feasibility work for an extension project into certain select locations of the Eastern Caribbean.

Alcatel and GCN have just signed a contract for phase two of their submarine cable network, which will link up Guadalupe to Martinique on the way to connect with Dominica. That phase will be completed in 2007.

A third phase is currently being promoted and would start from Martinique and connect to all the major southern islands down to Trinidad, Barbados and St Lucia. This leg would also be completed by 2007.

BNamericas.com"

Posted to the site on 7th March 2006