LOCALLY LOOPED: Southern Cross Cable director and Telecom Wholesale chief executive Matt Crockett chats with 2degrees founder and commercial and regulatory strategist Tex Edwards between sessions at Planet2010.
I talked to Southern Cross Cable director and Telecom Wholesale chief executive Matt Crockett at the Planet2010 telco conference earlier today.
The whole gabfest has gained unexpected fission due to the Pacific Fibre announcement yesterday; Rod Dury and Southern Cross Cable director/Telecom Wholesale boss Matt Crockett are among attendees here at Sky City.
His message, in short, is that Southern Cross has a load of unlit fibre, and has been reducing prices by around 20% per annum for the past few years.
“We would absolutely refute the inference that Southern Cross is short of capacity,” said Mr Crockett.
At times, there will always be a crush
So why do things slow down during the evening rush-hour, as Pacific Fibre co-founder Mark Rushworth highlighted yesterday?
“Because so much of traffic goes from the US here at peak hours and a lot of people trying to use it at once. People [ISPs] could buy more capacity on Southern Cross to address that - and they have been - but to make it completely uncontended, quite frankly, is not realistic.”
("Contended" is telco-speak for the slow-down that occurs when too many users try to access a limited amount of bandwidth at once).
So: the capacity is there, but ISPs aren’t buying.
Does Southern Cross need to be cheaper still?
Mr Crockett says he’s quite happy to let the market decide, once Pacific Fibre launches. “I wish them luck”.
Geography lesson
Earlier, in an email, Mr Crockett said of Pacific Fibre’s claim it’s Auckland-LA route would have lower latency, “If they think there is a more direct, lower latency route then they must know something about the seabed and broader geography of the Pacific that we've missed!” (See below for Rod Drury's response.)
Mr Crockett said he could write a book about the unexpected logistical problems companies encounter in the world of sub-sea cabling - and another about the resource consent battles Southern Cross has been through, especially with its US landing.
The implication: Pacific Fibre are newbies.
If they want some advice: Mr Crockett is happy to talk.
At this point, it's difficult to imagine any kind of partnership emerging from the "dialogue" that the Telecom exec suggests. But he said sub-sea cabling was "a tight knit club" and he expected to talk a lot with Pacific Fibre, one way or another.
For now, it looks like that will involve meeting Pacific Fibre head-to-head, in the market.
For the laid-back Southern Cross Cable director, that's fine too.
"We back ourselves to compete with whatever comes along."
Does he need a geography lesson? Rod Dury responds
UPDATE: "We know our geography. We fly in planes to the US all the time," Pacific Fibre co-founder Rod Drury told NBR this afternoon at Planet2010.
"Let's start counting the myths," said Mr Drury of Southern Cross Cable's response so far - indicating that if he does accept Mr Crockett's invitation for "dialogue", it will be a pretty animated session.
Fellow Pacific Fibre co-founder Lance Wiggs elaborated via a formal response to NBR, posted on the new company's site:
"Southern Cross’s shortest route from New Zealand is 8002 km to Hawaii and a further 4125 km to the USA mainland for a total (exclusing land-based cables) of 12127km. In contrast the direct route to LA or San Francisco from Auckland is about 10500 km. That’s a lot shorter, and also there is no lag associated with a landing station in Hawaii."
To Mr Crockett's assertion that the whole sub-sea cable industry is hard than it looks, including permits, Mr Wiggs said:
"Indeed the submarine cabling industry has these horror stories, and Southern Cross has a particular shocker – they were let down by a partner that failed to get the appropriate permits to land in the USA. We are aware of these stories and are working with and will always work with experienced campaigners that have been through a few of them. Permitting is very early on our project plan."
Incidentally, contrary to a hysterical media report earlier in the day, Mr Drury seemed in one piece.
For his part, Mr Crockett told Keallhauled he had talked to Mr Drury today.
"So we've begun our dialogue. I wasn't yanking your chain"
What was the dialogue about?
"We decided to have more dialogue."
READ ALSO:
Kordia: we’re open to Pacific Fibre ... but also alternatives
Quick, somebody check if Rod Drury’s still alive
Analyst: Pacific Fibre too optimistic about financing
How Drury, Morgan, Tindall will fund second Pacific cable
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Telecom exec: Pacific Fibre needs a geography lesson
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