US-based subsea fiber supplier SubCom is setting up shop in The Philippines at the Subic Bay shipyard, a sprawling facility owned by its parent, Cerberus Capital Management.

SubCom has opened a new deployment center at Subic Bay shipyard in the Philippines to provide a logistical staging area for its subsea cable projects. The new facility will support the Eatontown, New Jersey, company’s global operations and its fleet of ships.

The subsea fiber optic cable supplier is building the 19,200km undersea cable system connecting Southeast Asia, the Middle East and Western Europe at 12 locations from Singapore to France. The $600 million system, known as the SEA-ME-WE 6, is expected to be ready for service by the first quarter of 2025.

Subic Bay shipyard, located 111 kilometers northwest of the Philippine capital Manila, opens onto the disputed South China Sea. Strategically located at a former US naval base, the 300-hectare shipyard is owned by New York private equity group Cerberus Capital Management; Cerberus paid $300 million last year for the bankrupt facility.

To date, Cerberus has forked out another $40 million to make the shipyard operational again. Subic Bay shipyard is now being transformed into a multi-use site hosting diverse businesses, including telecoms, warehousing, shipbuilding, logistics and digital infrastructure.

SubCom is also owned by Cerberus, which bought the company from Tyco International in 2018 for more than $300 million.

US-China tech war beneath the waves

Besides microprocessors, telecommunication equipment, 5G, artificial intelligence and other advanced technologies, undersea cables have become the latest chess piece in the ongoing US-China tech war.

These undersea cables carry most of the world's intercontinental data traffic – from emails and banking transactions to military secrets. Concerns over sabotage attacks and espionage from the US and China have raised the stakes for investing in and advancing this critical infrastructure. As one of only four major companies in the world that manufacture and install these cables on the seafloor, SubCom has found itself in the thick of battle.

It snagged the contract to build the SEA-ME-WE 6 cable system even though China-backed HMN Technologies, which was said to be the first pick for the project. According to a special report by Reuters, the SEA-ME-WE 6 consortium reversed its decision after the US warned that it would ban American companies from buying capacity on the cable.

SEA-ME-WE 6 consortium members include Singtel, Bharti Airtel, Orange, Microsoft, Telecom Egypt, Sri Lanka Telecom, Telekom Malaysia and Indonesia's Telin.

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— Gigi Onag, Senior Editor, APAC, Light Reading