Tata Makes Big Bets in Asia

Tata Communications Ltd. executives told Light Reading today that its expansion into Asia is well-timed, given that the tough economy will force companies to lease network and data center capacity, rather than building out their own. (See Tata Adds $430M to Asia-Pac.)

Tata says it will invest $430 million overall in the Asia-Pac region, a full 21 percent of the $2 billion that it promised to spend over the next three years to fuel its global expansion. (See Emerging Markets Offer Capex Hope and Top 10 Telecom Markets: Asia.)

The investment will help the Indian carrier finish its second data center in Singapore and complete the main segment of the TGN-Intra Asia Cable System, a 10-Gbit/s subsea cable system that now links Singapore and Japan and will soon include links to Hong Kong, Philippines, and Vietnam.

Both the subsea cable and the data center project come at a time when most carriers are holding back on capex. But Tata's execs say that infrastructure investments pay off in a tough economy.

Data centric
"In the Asian market, a number of companies who did have projects to build data centers this year are rethinking those plans," says Abid Qadiri, Tata's VP of Global Managed Solutions. He says the company's new Singaporean data center will be up and running next year and will add to the more than 1 million square feet of data center and co-location facilities Tata has around the world.

Subsea progress
The main segment of Tata's $250 million, 6,700-km intra-Asian subsea cable is taking live traffic today, according to Byron Clatterbuck, Tata's SVP of Global Transmission Services. As he said earlier in our report -- Top 10 Telecom Markets: Asia -- Clatterbuck today noted the push behind more subsea capacity is more a matter of choice than bandwidth exhaustion. He notes that Tata's cable bypasses the "earthquake zone," where there's lots of seismic activity, and it’s the only direct fiber link from Singapore to Japan -- meaning that, unlike competing cables, Tata's doesn't come ashore or make landfall at any points on the route.

Tata first announced the TGN-Intra Asia Cable System in 2007 and, at the time, put the cost at only $200 million. (See Tyco to Build VSNL Subsea Network .)

— Phil Harvey, Editor-in-Chief, Light Reading

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