| Australia-Japan Cable upgraded |
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| Written by Stuart Corner | |
| Monday, 14 January 2008 | |
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Despite the embargo, the announcement was hardly news. AJC announced plans for the upgrade in May 2007, saying "Australia Japan Cable...is being upgraded to provide 240Gbps of capacity in response to rapidly increasing demand. Work is scheduled to be completed by early 2008, with some of the new capacity available in late 2007." It said at the time that the upgrade would cost between $US20m and $US30m. In today's announcement, AJC CEO Robin Russell claimed that the upgrade would increase the international capacity available from Australia by 50 percent adding that "Our upgrade goes a long way to filling the identified need for the foreseeable future, even taking into account the large growth in demand." However Pipe Networks has claimed all along that the primary reason for its planned link from Australia to Guam, where existing systems will provide onward connectivity to the US and elsewhere, was not a shortage of capacity but a shortage of competition leading to high prices. Other leading industry figures have confirmed this. Last November Byron Clutterbuck, VSNL's vice president, global carrier solutions, told telecoms industry newsletter, Exchange, that: "The capacity into Australia is rather constrained so my wholesale group does not offer any services into Australia, it is too costly...You really have a two player market for international facilities and generally when you have a two player market, prices stay high. You have a few cable systems: SeaMeWe3, AJC and Southern Cross, but really they are controlled by two parties."
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