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Telecommunications ANZ Bank to advise Pipe Networks' submarine cable project
Telecommunications ANZ Bank to advise Pipe Networks' submarine cable project | ANZ Bank to advise Pipe Networks' submarine cable project |
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| Written by Stuart Corner | |
| Sunday, 25 March 2007 | |
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Page 2 of 2 In February Pipe formed a subsidiary, Pipe International (Australia) Pty Ltd, headed by Slattery, to progress the project. The company said at the time that "progress has been encouraging and sufficient for the directors of Pipe Networks to incorporate a wholly-owned subsidiary company as the project vehicle." Since the project was announced, two other consortia have announced plans for trans-Pacific systems (one lead by Verizon and the other by Asia Netcom) and Southern Cross Cable has announced plans for a significant upgrade. Slattery told iTWire that he was not worried by these because none would contribute to increased competition on the route. "This is not a capacity issue, it is a competition issue...Even if two or three cables do come in they will still be owned by the same three or four people. The only way there will be a significant shift in pricing is if a party who is outside the current duopoly installs a cable." Pipe is hoping that this lack of competition will give potential customers the incentive the need to make sufficient capacity uptake commitments to the Pipe project to get it off the ground (or rather, into the water). Slatter added: "Any carrier who understands the situation in Australia realises that our cable will be the last chance for three to five years of getting a competitive cable into Australia. While Southern cross and AJC [The Telstra-owned Australia Japan Cable] might offers some sweeteners on pricing my belief is that those will be short-lived until competition is stifled."{moscomment}
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