Meta, the parent of Facebook, Instagram, and WhatsApp, is the second largest driver of internet usage worldwide. Its properties – and their billions of users – account for 10% of all processed content and 22% of all mobile traffic. Meta’s investment in artificial intelligence should increase that use even further. Therefore, in order to ensure that it will have a reliable infrastructure to support that business, Meta is taking its own pipes.
TechCrunch has confirmed with sources close to the company that Meta is planning to build a new, massive, fiber-optic subsea cable that stretches around the world – a 40,000+ kilometer project that could cost more than $10 billion. Importantly, Meta will be the sole owner and operator of this subsea cable – a first for the company and thus representing a milestone in its infrastructure efforts.
Sunil Tagare, an expert in submarine cables (and a pioneer in the space, as the founder of Flag Telecom), who was the first to report Meta’s plans in October, told TechCrunch that the plan will start with a budget of $2 billion but the project is building the amount could rise to more than $10 billion as the project progresses through the years of operation.
Sources close to Meta confirmed the project but said it was still in the early stages. The plans have been put in place, but the supplies have not, and they refuse to discuss the budget. It is expected that Meta will talk more about it publicly in early 2025, where it will confirm the cable plans, including the target route, capacity, and other reasons for building it.
It may take years before it is fully operational, if that is the strategy to follow, given the limited number of companies, such as SubCom, that are able to build infrastructure that already have large customers, such as Google, that retain their services.
“There’s really strong demand for cable ships,” said Ranulf Scarborough, an analyst of the submarine cable industry. “They cost per minute and are booked for several years to come. Finding the resources to do it soon is a challenge.” One possible scenario involves building in phases, he added.
The cable, when completed, will provide Meta with a dedicated pipeline for data traffic around the world. The planned cable route, the sources said, currently sees it go from the east coast of the US to India through South Africa, and then to the west coast of the US from India through Australia – making a “W” shape around the world. , as shown here by Tagare:
Meta’s infrastructure work is overseen by Santosh Janardhan, the company’s global head of infrastructure and head of engineering. The company has teams around the world that look after and plan its infrastructure – and has had key industry figures work for it in the past. In the case of this upcoming program, it is being considered for the operation of this company in South Africa, according to sources.
Fiber-optic subsea cables have been part of the telecommunications infrastructure for the past 40 years. What matters here is who is putting money down to build and own – and for what purposes.
Meta’s programs emphasize how investment and ownership of submarine networks has changed in recent years from consortia that include telecom carriers, now also including large technology giants.
Meta is not new to the subsea game. According to telecommunications analysts, Telegeography, Meta is part of the owners of 16 existing networks, including the latest 2Africa cable that spans the continent (others in that project include Orange, Vodafone, China Mobile, Bayobab/MTN and others).
However, this new cable project will be the first managed by Meta itself.
That would put Meta in the same category as Google, which is involved in 33 different routes, including several regional efforts where it is the sole owner, tracking Telegeography. Other major technology companies that are part owners or capacity buyers in submarine cables include Amazon and Microsoft (neither of which own any of the lines themselves).
There are many reasons why building undersea cables is attractive to large technology companies like Meta.
First, the single ownership of the router and cable will give Meta first dibs to support traffic on its premises.
According to earnings reports, Meta makes more money outside of North America than in its own home market. Having a priority on dedicated submarine cable can help ensure quality of service for that traffic. (Note: this is just to ensure long-term traffic: the company still has to negotiate with carriers within countries and the ‘last mile’ delivery to users’ devices, which can have its own challenges.)
Meta, like Google, also plays a major role in providing regions with its subsea investments, saying that projects such as Marea in Europe and others in Southeast Asia have contributed more than “half a billion dollars” to the economies of those areas.
However, there is a better motivation for this investment: technology companies – rather than telephone carriers, traditional manufacturers and owners of these lines – want to have more direct ownership of the pipelines needed to deliver content, advertising and more to users around the world.
“They make their money from their products that are delivered to end users, and they will do everything they can to ensure the customer experience, whether that’s video delivery or other assets,” said Scarborough, the analyst. “If we are to be honest, who will trust traditional telcos anymore? Technology companies are now private. They realized that they have to build for themselves.”
The second is geopolitical.
Several times in recent years, submarine cables have been downed as collateral or direct war damage. Houthi fighters, backed by Iran, are following the boats and in the process damaging cables in the Red Sea (like the one connecting Europe to India). This month (November 2024), Russia was accused of cutting an underwater cable in the Baltic Sea. Just this week, another cable went down in European waters, with a Chinese vessel now suspected.
The route as envisioned by Meta is intended to help the company “avoid areas of international friction,” a source close to the company told TechCrunch.
Tagare points out on his blog that the route will avoid the Red Sea, South China Sea, Egypt, Marseilles, the Straits of Malacca and Singapore – “all of which are major areas of failure.”
The FCC’s announcement this month (November 2024) that it plans to review the authorization of submarine cables for the first time in decades, partly due to national security and cable ownership, may also be seen as another fulfillment here: Meta will be the sole owner. of the route through safe corridors.
There is a third possible reason for Meta’s subsea idea, although it is highly speculative.
From Tagare’s point of view, it is directly related to the cable across India. He believes Meta has an opportunity to build data center capacity in the country specifically for training and working with AI models, and the submarine cable could play a role in that effort.
He points out that the cost of computing bandwidth in India is a fraction of the price in the US, and many in India have been buzzing after the recent visit of Jensen Huang: in a meeting with the chairman of Reliance Mukesh Ambani, the chief executive of Nvidia talked about the structure in India. its AI infrastructure. Reliance, among other vendors, will use Nvidia’s Blackwell chips in future AI data centers.
“India can be the training capital of the world,” Tagare said in an interview. He believes that Meta may want to build AI training in the country around that infrastructure.
AI is a big part of Meta’s infrastructure roadmap. But more than that, India is a huge market for Meta, the highest number as the country with the most users on Facebook (more than 375 million users), Instagram (363 million), and WhatsApp (536 million) and those buyers prove it. being more enthusiastic about new features like its AI tools. With strong investments being made in the data center market in the country, India still has a lot of potential for growth, so this fact alone makes it logical to add India as a starting point for this project.
Sources close to the project tell us it’s too soon to say whether AI is part of Meta’s equation in this project, describing it as part of the “long tail” of considerations and possibilities, and whether Meta will unlock power for others. users beside it.
Meta declined to comment for this article.
