Regional Systems or a Network? A Look at the Americas
By Andy Bax
July 20, 2020
Ask anyone from the telecom sector in this part of the world and they will tell you “the Americas are different”, and they would be right, especially in the wholesale market. Fiercely competitive and until relatively recently one of the most expensive regions in the world for wholesale services, the Americas remains a place where protecting your turf and maintaining the status quo is often considered more important than delivering what your customers actually need. A steep decline in wholesale pricing has only intensified these practices and while price erosion over the past few years has no doubt helped stimulate growth in the region, the development of individual cable systems as opposed to an integrated network fabric for the region still provides a stranglehold on any kind of step change in service delivery.
If you were to look at a cable map of the Americas, you would be forgiven for thinking that there were plenty of cables, capacity and connectivity available across the majority of the region. What you would not see is the age of many of the cables creeping quickly toward retirement and the fact that they are, for the most part, owned by operators with a greater focus on the domestic markets they have a dominance in. Over the years this has created a tendency to be, at best, selective about cooperation between operators on international connectivity and, in those worst cases, blatant protection of a dominant position in a market that prevents competition and diversity.
For the hyperscalers, international carriers and sophisticated content owners this has not necessarily slowed their development in the region as they have the purchasing power and depth of organizations to either purchase independently on multiple systems or even build their own cables. The questions is “what about the other 95% of buyers in the region?” Those companies that operate in their local markets and are actually the drivers for innovation and better connectivity. They need international bandwidth that brings a combination of cost efficiency, high availability and reach. For them, the Americas does not need more submarine cables – it needs a resilient, integrated and efficient regional network where the different cable operators are willing to cooperate in delivering solutions across multiple cable systems, irrespective of ownership. I have not seen anywhere in our global subsea industry where this is more needed, and yet unfortunately more lacking, than in the Americas region.