Vocus and Alcatel Submarine Networks (ASN) have entered into an agreement to construct the Australia Singapore Cable (ASC).
The project is a 4,600km submarine cable system linking Australia to Singapore and Indonesia.
Both companies expect the ASC to take around 19 months to build, and are looking at a completion date by August 2018
The cable was a key strategic consideration when Vocus purchased Nextgen Networks, and creates a fully interconnected high capacity fibre network from the East Coast of Australia through to Singapore.
ASC also provides Vocus with a platform to increase utilization and delivers a unique competitive advantage.
The companies disclose that the project is expected to cost around US$170m, with payments made during FY17 being funded from existing debt capacity.
Recently, TeleGeography – telecom data market experts – have unveiled a report depicting that the estimated bandwidth between Australia and Asia will exceed 50Tbps by 2029.
The report also estimates that the ASC has an opportunity to capture a minimum of 15.5Tbps of capacity sales by the year-end 2029.
According to TeleGeography, by 2019, 30% of Australia's overall international bandwidth will be connected to Asia.
The firm attributes this to growth in data consumption, particularly in the Asian region, therefore placing the ASC in a strong position.
ASC, combined with Nextgen's trans-Australian fibre network and Vocus' capacity on the Southern Cross cable to Los Angeles, provides a competitive alternative route for data traffic from the Indian Ocean region through to North America.
Vocus says it will update the market on the progress of the ASC in late February 2017.