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New Zealand gov't backs second trans-Pacific Internet cable

The New Zealand government has agreed to a deal worth 65 million NZ dollars (56.9 million U.S. dollars) that could end the single-cable monopoly that connects the country to the rest of the world through the Internet.

The deal could also see some of New Zealand's smaller Pacific island neighbors also get improved access to the Internet by providing connections.

The deal with New Zealand-based Hawaiki Cable Ltd. was signed through the government-owned company, Research and Educational Advanced Network New Zealand Ltd. (REANNZ), which operates New Zealand's high-performance research and education broadband network.

It secured REANNZ a 25-year anchor tenancy on the cable with an initial contribution of 15 million NZ dollars (13.13 million U.S. dollars) and included annual fees over the 25-year period.

The agreement was conditional on Hawaiki obtaining sufficient presales contracts from other telecommunications companies for the cable link to Australia and the United States, Science and Innovation Minister Steven Joyce said in a statement Tuesday.

The cable would give REANNZ dedicated capacity that could handle huge data volumes, and provide high levels of reliability.

"The tenancy on the new cable will provide more capacity for its members to take part in global research projects such as the Large Hadron Collider and the Argonne Leadership Computing Facility," Joyce said.

The cable would supplement the existing Southern Cross Cable system, which had the capacity to serve New Zealand's commercial international traffic requirements until at least 2020.

The 25 terabit-per-second cable would run between Whangarei at the top of the North Island, Sydney in Australia and Oregon in the United States, and connect several Pacific islands en route, Hawaiki chief executive office Remi Galasso said in a statement.

U.S. company TE SubCom was contracted to lay the 13,127-km cable network, which was expected to come online in 2016.

The last attempt to connect New Zealand with a second cable collapsed in 2012 when New Zealand-based Pacific Fibre announced it had failed to raise the 400 million NZ dollars (350.29 million U.S. dollars) required to fund a fiber-optic cable link to Australia and the United States.

Competition in the international cable market is seen as essential to the success of the government flagship project of rolling out ultra-fast broadband (UFB) to most of the country.

Lowering the cost of international bandwidth would help UFB, which is already embroiled in domestic pricing problems, become more affordable.

In September 2011, Australian telecommunication research company Market Clarity reported the cost of bandwidth to the U.S. from New Zealand was 5.8 times greater than the price paid by Australians.

[Source: Xinhua, Wellington, 01Jul14]

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