The consortium plans a 8,000-km long Bay of Bengal cable system

Telecom carriers Vodafone Group of the U.K., Telekom Malaysia from Malaysia, Omantel from Oman, Etisalat from the UAE, Reliance Jio Infocomm and Dialog Axiata from Sri Lanka have formed a consortium to set up an 8,000-km-long Bay of Bengal Gateway (BBG) submarine cable system to link Malaysia and Singapore to the Middle East, with connections reaching out to India (Mumbai and Chennai) and Sri Lanka.

On Tuesday, the construction and maintenance agreement (C&MA) and the supply contract for BBG were signed in Kuala Lumpur. The cost of the BBG cable line has not been disclosed. The cable system is designed to provide upgradable and transmission facilities by having 100 Gbps capability. This cable system is expected to carry commercial traffic by the end of 2014.

According to analysts, this new cable system could help end the monopoly of some existing players operating in this region and bring down infrastructure cost for the consortium members. Tata Communications’ formerly VSNL submarine cable system almost passes through the same route.

“This development is extremely positive for the telecom industry. Infrastructure sharing is the in-thing as telecom has become highly competitive. For the consortium members, the capex will be much less. This move will lead to consolidation,” said Ankita Samani, IT & Telecom analyst, Angel Broking.

Reliance Jio Infocomm, is believed to have played a key role in this move as it gears up to launch 4G services by the end of this year. The construction of BBG is planned not only to provide connectivity between Southeast Asia, South Asia and the Middle East, but also to Europe, Africa and to Far East Asia through inter-connections with other existing and newly-built cable systems landing in India, the Middle East and Far East Asia.

“BBG will also serve as an extraordinary opportunity for business growth as it will help support current and future high capacity requirements from the surrounding areas of the region and next generation Internet applications,” Reliance Jio said in a statement.

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