The 6000km Pacific Caribbean Cable System (PCCS), which is scheduled for completion in Q3 2014, is being backed by five operators, including Telefonica, Cable & Wireless, Setar, UTS and Telconet.
Following almost two years of discussion, the operators all signed a construction & maintenance agreement (CMA) for the cable project last November. They have also signed a supply contract with Alcatel-Lucent which will see the company supply 100G technology on the route.
The move is expected to bring additional capacity and connectivity to several underserved countries in Latin and Central America.
“I think once this project is complete there will be enough capacity serving the region, and of course serving Ecuador,” said Carlos Pazmino, chairman of PCSS and representative of Ecuadorian operator Telconet.
Pazmino also said that through Telconet’s fibre optic network in Ecuador, the cable could also benefit countries surrounding countries.
PCCS is expected to go live less than a year after the 17,500km America Móvil 1 (AMX-1) cable system, which aims to link the US, Central America and Brazil.
Like AMX-1, PCCS is also expected to land in Jacksonville, Florida in the US. With cables from Latin and Central America typically connecting to the US via Miami, this marks a new trend in the subsea cable market.
“Almost all the cables that serve the region are landing in the south part of Florida, so to get more redundancy we decided to land in the north,” said Pazmino. “It is also equal distance away from Atlanta and Miami, so traffic can be delivered on from there to those two major data centre hubs.”
Pricing on routes from the US to western Latin America and the Caribbean basin are still very high compared to the rest of the globe.
TeleGeography analyst Greg Bryan believes the launch of AMX-1 and PCCS could help drive prices for capacity down in the region: “At present US-Ecuador is served by only two cables and few competitors. While Panama and Colombia already have several cables, new cables will represent a large amount of new supply and some additional competition. Particularly in Colombia, where prices have historically been relatively high even for South America, there will very likely be at least three new cables coming online: AMX-1, GlobeNet Colombia Extension and PCCS. We expect to see rapid and significant price declines as a result of this,” he said.
He did warn, however, that while prices might decline on subsea cable systems, prices for connectivity inland might not. “It is also important to remember that price declines on submarine cable systems may not be met with similar declines on PoP-to-PoP/city-to-city services, depending on the country's regulation of sub cable landing and backhaul,” he said.
“The PoP-to-PoP cost will still go down significantly, but the cost of getting from the landing station to the PoP in the city will comprise a much greater portion of the total cost.”
