Facebook (Nasdaq: FB) is making an investment in the Asia Pacific Gateway (APG), a new submarine cable system running links from Malaysia to South Korea and Japan, as a way to expand membership in one of its fastest growing markets.
While recent reports indicate that Facebook's growth in the U.S. is starting to slow, traffic to its site in Japan, for instance, is on the rise. According to a recent Nielsen survey, growth in Japan "had more than doubled during the year to May, totaling 17.2 million people that month."
"Our investment in this cable will help support our growth in South Asia, making it possible for us to provide a better user experience for a greater number of Facebook users in countries like India, Indonesia, Malaysia, the Philippines, Hong Kong, and Singapore," a spokesman said.
However, the spokesman would not reveal how much Facebook was specifically going to invest in the new system, other than to say that the consortium behind APG, which includes traditional service providers China Telecom (NYSE: CHA) and China Unicom, had invested a total of $450 million.
Joining China Telecom and China Unicom are a number of other Asia Pacific-based telcos including China Mobile (NYSE: CHL), Chunghwa Telecom (NYSE: CHT), KT Corp. (NYSE: KT), NTT DoCoMo (NYSE: NTT), LG Uplus (KSE: 032640.KS), Vietnamese Posts & Telecom Group, Viettel, TOT Public Co., Ltd., CAT Telecom Public Co., Ltd., and StarHub (SES: CC3.SI).
One of the key advantages of the new cable, argues dotCom Berhad, a Malaysian service provider whose subsidiary Global Transit is also involved in the APG cable, is that it will give Southern Asian countries a more efficient method to route traffic to North America.
"This lowers our dependencies on Singapore as the main gateway for Internet traffic," said Saiful Husni, CEO of Global Transit, a Time Dotcom subsidiary. "We can now channel high volumes of this traffic on our network with the lowest latency [access time], directly to the U.S."
The APG is set to be complete and ready for service by Q3 2014.
- Sling Broadband has this article
Study: Intra-Asia submarine traffic to grow 39% by 2018
Chunghwa Telecom to participate in Asia-Pacific Gateway submarine network
NTT Communications to jointly build 40 Gbps Asia-Pacific submarine cable