du joins submarine cable consortium

du announced today it is investing $50 million in a global consortium that is working on the construction of a submarine cable system between the UK and India.

The deal underlines du's strategy to position itself as a hub for telecoms services, giving the operator the means to provide triple play customers with additional value-added services.

"The project will bring resilience and diversity to du's network and position the UAE as a regional business destination with broadband capacity feeding into the country through diverse entry and exit points," Osman Sultan, du's CEO, said at a round-table presentation today.

"The cable will be accessed through a new landing station in Fujairah and will offer an additional cable landing station into the UAE [in addition to Dubai], adding diversity to the existing facilities from telecoms operators in the country," he added.

The project, which is known as Europe India Gateway (EIG), is budgeted at $700 million, and will significantly improve the capacity and performance of the participating operators' networks when it becomes operational in the second quarter of 2010. The 15,000km-long cable, which will connect thirteen countries in three continents, is designed to provide up to 3.84 terabits per second (Tbps) - equivalent to the entire population of the UAE making voice calls simultaneously, according to Sultan.

With other operators in the consortium including AT&T, Bharti Airtel, MTN Group, Omantel, STC, Telecom Egypt and Telkom SA, there are questions whether this will facilitate new business partnerships in the region for du. However, Sultan said the cable deal only represented an improvement of capacity and bandwidth.

In addition, the company said the new cable system would act as a back-up solution in the event of traffic disruption. In February this year, several cable lines were cut in suspicious circumstances, causing severe connectivity disruptions across the Middle East. According to Andrew Grenville, EVP international and wholesale, in the event of a cable disruption, the EIG cable system would give the operator more options for redirecting traffic.

"What happens in those circumstances is that you put your traffic through other cable systems, and that's exactly what du did in February, when there was a very unusual set of circumstances and we had multiple cable cuts. We rerouted our traffic to different cable systems and it'll be exactly the same in the future," Grenville said.

"I expect the EIG cable system will be used to carry other traffic if another cable system breaks and vice versa. That's our role to make sure we have a backup plan in place. But more importantly, by investing in other cable systems we've already got diversity. If we had a cut in an existing cable, we've got another one in another landing station. The more we invest in infrastructure, the better it is for our customers," he added.