Seaborn Networks: Leading the pack in steady growth and progress in the subsea industry

2019 was a transformational year for Seaborn. We moved our business from being a pure wholesale capacity provider and transitioned deeper into our customer’s eco systems through the development and deployment of our IP and MPLS network across Seabras-1. In the first half of 2019 we deployed a leading and highly differentiated IP network delivering un-restricted, high quality IP connectivity in both Brazil and the US. This system leverages Seabras-1’s high availability, low latency and immense bandwidth. An IP network is only as good as the connectivity it provides though, and so in the second half of 2019 we focused on establishing those global connections to enable adjacency and ease of connectivity for our customers. We have now connected to over 2,400 global networks and will continue to grow that number as we move forward in 2020.

 

The recent success of our IP portfolio has been tremendous and while we’re delighted with the progress we’ve made, we aren’t standing still. Enabling direct connectivity to a growing list of global IX’s is key and in January 2020 we announced 6 additions to that footprint with more to come over the coming weeks and months.

 

With steady growth in large scale wave and capacity sales during 2019, we see significant progress in the Latin American market.  To that end Seaborn announced a strategic partnership with EdgeUno in 2019 that sees us collectively delivering capacity, IP and infrastructure as a service (IAAS) services throughout the region in 2020.

 

 

 

It continues to be an interesting time in the subsea world we live in. The recent development and deployment of subsea cable systems with higher fiber counts is largely driven by the hyperscalers, while the ability to extend the life of existing systems through equipment upgrades is one that is throwing challenges of its own. We are now seeing operators struggle with how best to operate systems that are, or soon will be, beyond their original design life.

 

However, I think the largest driver of change is still under development. There is a critical balance between delivering ultra-high capacity cable systems between key locations for the hyperscalers, while recognizing the needs of the broader telecoms community in terms of national and international connectivity and access to that hyperscale content. It can be a challenging relationship between the traditional operators and the hyperscalers, largely driven by the need of the hyperscalers to build quickly in a world traditionally slow at developing new subsea networks, be they consortium or private systems. We now see some of the hyperscalers building together or alone to meet their rapidly growing demand, but these are primarily routes specifically tailored to deliver between their own global hubs. 

 

There remains a multitude of locations where international connectivity is essential to enable or continue to develop the global infrastructure that our industry provides. Combine that with an environment where there are often multiple operators with cable systems between regions and continents, and we see each operator competing with the others for the same traffic on the same route. The world of the hyperscaler and the cable operator start to look very different indeed. Operators will historically try and get every last drop of capacity out of a subsea network before either upgrading or replacing it, not aligning with the hyperscalers needs for fiber pairs and constant route development through new cables. This has led to the operator community focusing on their cable systems rather than regional service paths. While the hyperscalers may have 3 or 4 cable systems on any given route, operators are finding themselves with the challenge of providing redundant or high availability services when the only other options available to them are now from their competitors.

 

It is not all doom and gloom for the subsea operators though. We see a recognition of the challenges that maintaining the status quo in the operator world brings. In our specific region of operation, Latin America, competition has been fierce for many years. The idea of operators working together to create resilient service paths for one another was inconceivable, but not anymore. We see a move toward collaboration in delivery of services from a customer base that now demands the same levels of service and resilience that the hyperscalers build or buy for themselves. At the same time there’s a general recognition that while the old consortium approach to building cables doesn’t deliver quickly enough, a purely private cable approach for most operators is not the answer either. We are seeing hybrid business models develop now that should deliver the sustainability that operators need and the speed of delivery that hyperscalers demand. 

 

All in all, a very interesting time in our industry and not one without challenges, but also moving in the right direction.

 

 

 

I see 3 key points here for the transoceanic cable operators. First, a pure wholesale capacity player is going to struggle in any market today and in the future as capacity is now a commodity item on the main intercontinental routes. Broadening the services we deliver and reaching deeper into the customers product needs takes a lot of work and resources, but we, at Seaborn, believe it’s critical to any ongoing sustainability question.

 

Secondly, a development and financing strategy that can work alongside the hyperscalers on their builds, or provide cable systems that the hyperscalers are willing to buy into, is critical to ensure ongoing development of subsea routes key to our industry. A 2-year development cycle is too long for the hyperscalers today and too short for an operator. Developing a financing environment on both the operator and lender side where access to funds to build can be done quickly is key. A 2-year-old business plan in any industry, that grows exponentially and is ever changing simply no longer make sense. 

 

The third point focuses around technology. The move to open gateways as opposed to the more traditional vendor specific submarine line terminating equipment has enabled broader collaboration between parties on cable builds and subsequent fiber pair sales. That’s great for the initial make up of any build relationships between parties or subsequent large fiber pair sales but hasn’t moved the needle for the subsea world in terms of broader service delivery. Software defined networks (SDN) is now finally tangible, and network orchestration is becoming available. However, these are largely vendor dependent and almost entirely missing from the subsea world. With a view to my earlier comments regarding collaboration between operators and the need to view our industry in terms of service paths as opposed to discrete cable systems, SDN and the network orchestration capabilities it can deliver are possibly the single most important technological development that our industry needs to pursue.

 

 

 

I think I probably answer this in the same way as anyone from the subsea industry would respond. Our industry connects the world and enables all these wonderful products and services that we take for granted today to work, but the subsea industry is both a small community and one that is spread all over the globe. Being able to come together at events like Submarine Networks EMEA is extremely beneficial from both a time and cost perspective as we are able to focus as an industry for a couple of days on a wide range of topics.