Telecom lines up cable project to link Asia-Pacific systems

Telecom is one of three companies investigating the feasibility of a new telecommunications cable system linking Singapore, Jakarta and Perth.

If the project goes ahead the companies, which also include Cable and Wireless Optus and Singapore Telecommunications (SingTel), could link their existing networks to it.

The new system would vastly expand the capacity for internet traffic.



Telecom network manager Simon Moutter said that an Asia to Australia link would complement the recently commissioned, $2 billion Southern Cross Cable Network, in which Telecom had a half share, Optus had 40 per cent and MCI WorldCom had 10 per cent.

Telecom received a $221 million dividend from Southern Cross in the March quarter result reported on Friday.



"Our investments in cable have reaped rewards, operationally and financially," Mr Moutter said.

"Similarly, if this proposal goes ahead, it would be a solid investment opportunity for all three companies."

Telecom said it did not have a cost estimate for the project.

Chris Hancock, managing director of data and business services at Optus, said the cable could forge an important link between the businesses of Asia and Australia.

"Subject to board approval - and detailed financial terms - we believe this is a great proposal."

SingTel vice-president of global business Lim Shyong said the cable would be suitable for mission-critical data and high bandwidth applications.



Meanwhile, Telecom has sold its mobile radio business to Wellington company TeamTalk and taken a 19.9 per cent stake in the company. Telecom's general manager of mobile, Mohan Jesudason, said the sale reflected Telecom's transformation into an online and communications business.

"While mobile radio still plays a crucial role in the telecommunications sector, it is no longer a core business area for Telecom."

- NZPA