Seacom's vulnerability exposed

Seacom's current cable break that has all but left the undersea cable operator inoperable for a week, has raised market speculation that it may soon formalise alliances, if not an outright merger, with similar companies.

This week, Seacom's vulnerability as a single line operator was highlighted when a segment of its East African cable broke, leading to downtime of six to eight days. At the time of writing, Seacom had employed Tyco, the company that originally laid the cable, to initiate repairs by sending a ship to the area north of the Kenyan port of Mombasa.

Rumours that Seacom was looking at either forming a merger or formal alliance with Main One, the Nigerian-based private equity company whose cable stretching from Lagos to Portugal became operational last week, have been circulating for some time.

“This incident and the recent Telkom power outages show that there is still a need for more undersea cables,” says Arthur Goldstuck, MD of research company World Wide Worx. “Initially, there was a lot of resistance to Seacom from the other telecommunications operators, because Seacom is a private equity company and not a telco. However, Seacom now seems to have been accepted.”

Goldstuck says Seacom recently signed a redundancy agreement with Telkom and will probably do so with other operators, as is international practice. But it is hard to make a call yet on any kind of merger or takeover in the undersea cable sector.

In May, Main One announced it had signed a memorandum of understanding (MOU) with Seacom that the two would look at connecting their networks near Cape Town, effectively meaning that Africa was ringed by fibre-optic cable.

This is similar to a vision that was originally touted by US telecommunications operator AT&T in the late 1990s and then more recently by the SA Department of Communications in the form of a project called Uhurunet. Both projects have come to nought.

However, Seacom CEO Brian Herlihy told ITWeb at the Fortune Global Forum conference, on 29 June, that apart from signing the MOU with Main One, both companies were still focused on getting their networks fully operational.

That was the day Telkom's South African Far East cable experienced a power failure, causing a panic among international broadcasters over the 2010 Soccer World Cup. Telkom has secured the rights to transmit the World Cup broadcasts overseas as it is one of the main tournament sponsors.

“We are looking at our options, but there is still a lot of work to do for Seacom and Main One,” Herlihy said.

Suveer Ramdhani, Seacom's head of product strategy, says the company is one part of an African Internet build-up and, as other cable systems come on line, there will be more redundancy between the systems.

“Seacom is already in talks with other cables due to land. As more cables reach eastern and southern Africa, the problem of redundancy will be easier to manage as more options become available to reroute capacity during an outage. It is common practice in the industry around the world for cable networks to provide redundancy capacity to one another,” he says.

Ramdhani says Seacom is also working on a number of projects that should be in place within months, including the installation of routers with IP MPLS capability on to the landing points of the cable. This would make a switchover to other capacity a lot simpler.

“In addition, the finalisation of Seacom's own link between India and Europe would provide further redundancy options,” he says.

Seacom's latest update says its technical team has identified the exact location of the fault and the repair process has been fully mobilised. The faulty section of the cable is at one of the deepest points along its route, 4 700m below sea level, and may require the use of underwater robots to locate and retrieve the cable for repairs.

The update also says Seacom has successfully sourced and activated restoration capacity on other cable networks servicing eastern and southern Africa, and will continue to work closely with all parties to ensure restoration capacity is made available to additional clients requiring it.