MikeLigalig.com

By Paolo Montecillo
Philippine Daily Inquirer

Ayala-led Globe Telecom Inc. is spending nearly P3 billion as its contribution to the construction of an ultra-high capacity fiber-optic cable that will improve the speed and reliability of Internet connectivity in the region.

Officials on Thursday announced that the company had signed an agreement with other telecommunication firms in neighboring countries for the construction of the new Southeast Asia Japan Cable (SJC).

Globe said the project was scheduled for completion in 2012 and would support the company’s continuing expansion to provide Internet services to local business process outsourcing (BPO) firms.

“It has always been Globe’s thrust to provide its customers with superior experience by delivering pioneering innovations to the Philippines,” company president and chief executive Ernesto Cu said.

Gil Genio, head of Globe’s carrier services, said: “Globe’s participation in the SJC project supports the continued growth of our broadband services and further enhances our capabilities in supporting offshoring and outsourcing in the Philippines.”

The SJC will cost about $400 million to build, with the Philippine firm spending about $60 million, or about P2.76 billion, as its share in the expenses.

“This is already part of our 2010 capital expenditures,” Cu said in a briefing late Thursday.

The company has set a budget of $500 million for its capital expenses next year—roughly the same amount it expects to spend this year.

Broadband Internet has been tagged as the local telecom firms’ next area for growth, with the telephony market for traditional voice call and text messaging services already having matured in the last decade.

With an expected capacity of 17 terabytes a second, this will be the world’s highest capacity cable system.

To illustrate this capacity, a report from the US federal government showed that as of last May, the US Library of Congress contained about one terabyte of data. Globe’s share in the bandwidth will be around 1-1.2 terabytes a second.

The company’s expenses will not only cover its share in the construction of the cable, but will also cover the upgrade of Globe’s own networks to accommodate the upgrade. The country will be connected to the cable through a landing station that will be built in Nasugbu, Batangas.

Genio noted that the new cable system, once completed, would not only increase connectivity between countries in the region but would also serve as a back-up system in case other Internet systems in Asia fail for any reason.

Companies that will be involved in the project are Google (USA), KDDI (Japan), Network i2i (India), Reliance Globalcom and Telemedia Pacific Inc. Ltd. (Hong Kong and Indonesia).

Globe said companies from Singapore and Malaysia would also be in on the deal, but disclosure rules in their respective countries kept them from announcing their involvement for now.

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