Level 3 Communications, Inc. (Nasdaq: LVLT), a global broadband infrastructure company, and FLAG Telecom (Nasdaq: FTHL; LSE: FTL), an independent global carriers' carrier and network services provider, announced an agreement for a new multi-terabit intra-Asia submarine cable system. The six-fibre pair system is designed to offer intra-regional, city-to-city connectivity between the high traffic centers of Hong Kong, Seoul, Tokyo, and Taipei. Total cost of the entire system is estimated to be approximately $900 million.
Level 3's existing North Asian cable system, currently under development, will form the Eastern leg of the new system connecting Hong Kong, Taiwan and Japan. FLAG Telecom will develop the Western leg, connecting Hong Kong, Korea and Japan. The first link of the system, between Hong Kong and Japan, is expected to enter service in the second quarter of 2001. FLAG Telecom will be responsible for the integration of the Eastern and Western links of the system. The whole system will be over 10,000 kilometers in length and will be managed and operated by FLAG Telecom.
Level 3 will have three fibre pairs on the system, which will be referred to as "Tiger". FLAG Telecom's three fibre pairs on the new system will be branded as FNAL (FLAG North Asian Loop).
Ed McCormack, COO, FLAG Telecom, said: "FNAL is planned to connect to the FLAG Pacific-1 cable system in Japan, providing seamless multi-terabit connectivity to the United States and to the Europe-Asia cable in Hong Kong and Japan. FLAG Telecom expects to fund the costs of the system through a combination of cash on hand and pre-sales."
The Eastern leg of the cable system is ahead of schedule having already landed in Hong Kong. The cable will land in Korea and Taiwan later this year. The Japan landing is expected to provide a seamless link to the Japan-US cable system, followed by a link to the FLAG Pacific-1 cable system in 2002. Additional landing stations are under development in Pusan, Korea and Toucheng, Taiwan.
Built by Alcatel and Fujitsu, the intra-Asia submarine cable system fully utilizes state-of-the-art Dense Wavelength Division Multiplexing (DWDM) technology operating at 10Gbps and is expected to offer an initial combined capacity of 320 Gbps, upgradeable to 2.5-3.8Tbps. Terabit technology is combined with SDH/SONET networking to provide customers with seamless city-to-city connectivity.
The FLAG Europe-Asia cable stretches from the UK to Japan and entered commercial service in November 1997. FLAG Atlantic-1 (FA-1), the world's first dual transoceanic terabit cable system, is currently under construction and is scheduled to enter service in Q1 2001. FLAG Pacific-1 is the longest transoceanic DWDM system announced to date and is expected to enter service in 2002.
About Level 3:
Level 3 (Nasdaq: LVLT) is a global communications and information services company offering IP-based services including broadband transport, colocation services, submarine transmission services and Softswitch-based services.
About FLAG Telecom:
FLAG Telecom (Nasdaq: FTHL; LSE: FTL) is an independent global carriers' carrier providing products and services to the international carrier community, Application Service Providers (ASPs) and Internet Service Providers (ISPs) across a global network platform optimized to support the next generation of IP over optical data networks.