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Paperwork for Southern Cross Next cable build signed off

Cable set to be completed in 2022 and provide 72Tbps of capacity.
Written by Chris Duckett, Contributor

Southern Cross has gained the regulatory approvals needed to move into the construction phase for its Next cable between Australia and the United States.

The 13,483 kilometre cable is set to cost $300 million and is designed to carry 72Tbps, adding to the two present Southern Cross cables carrying 20Tbps. Next is now set for completion by January 2022. The cable will span Sydney to Los Angeles, as well as hit Auckland, Fiji, Tokelau, and Kiribati along the way.

Alcatel Submarine Networks will build the cable that Southern Cross believes will have the lowest latency between Australasia and the US.

At the same time, the process of Telstra gaining a quarter share of the Southern Cross Cable Network is set to be completed over the next few days.

Southern Cross said the remaining conditions of the transaction were "procedural in nature".

As a result of Telstra's purchase, Spark New Zealand will see its holding be diluted from 50% down to 37.5%. The other shareholders of Southern Cross are Singapore's Singtel, and Verizon Business.

"With 80% of all the internet traffic to Australia coming from the US, a high speed, low latency direct route to North America is a very important investment for our business and our customers," Telstra enterprise group executive Michael Ebeid said.

"Southern Cross builds on our existing footprint across Asia Pacific where we carry 30% of the region's active capacity."

Spark told the ASX that it expects the Next cable to contribute NZ$70 million to NZ$90 million in equity until the end of fiscal year 2022.

In May, the consortium of companies behind the Indigo subsea cable -- Telstra, SubPartners, Google, Singtel, AARNet, Indosat Ooredoo, and Alcatel Submarine Networks -- announced that the 36Tbps connection between Australia to Singapore was ready for use.

Indigo consists of two parts, a western 4,600km link between Perth and Singapore, and its central 4,600km link between Perth and Sydney that is claimed to be Australia's first transcontinental fibre optic submarine cable. A branch also provides connectivity to Jakarta.

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