Top Chinese telecom equipment maker Huawei Technologies
yesterday said it will form a joint venture with UK-based marine
engineering company Global Marine Systems Limited.
The two companies have signed a memorandum of understanding
(MOU) for the joint venture with the aim to "become the leader in
providing submarine solutions and services globally", Huawei said
in a statement.
The details about the proposed joint venture, pending regulatory
approval - such as how much investment the two will pool into the
venture and which company will take the controlling stake - have
yet to be finalized.
Global Marine Systems operates the world's largest fleet of
cable ships and subsea vehicles and is the market leader in marine
cable installation and maintenance for telecommunications, as well
as scientific research, oil, gas, utilities and renewable
energy.
The forming of the joint venture comes at a time when the
spending on high-bandwidth undersea fiber optic cable networks is
seeing an upswing, with current Internet networks facing a
bottleneck in capacity.
Six operators from China, South Korea and the United States in
December signed a deal to build a $500 million submarine cable
linking China and the US.
A powerful earthquake off the Taiwan coast recently knocked off
international undersea fiber optic cables, disrupting
communications in Asia and spurring the demand for safer submarine
networks.
Seventeen major telecom companies in April signed a pact to
build another $500 million undersea fiber optic cable between
Southeast Asia and the US that would be safe from earthquakes and
tsunamis.
Citing industry forecasts, Huawei and Global Marine Systems said
at least 20 new supply contracts are expected to be awarded this
year, totaling nearly 100,000 route-kilometers - largely driven by
the two transpacific cable projects.
Their combined strength could increase the chances of Huawei and
Global Marine Systems to land the contracts.
Last year, Huawei was the fastest-growing vendor and the No 2
player in the global optical network market, holding a 11.3 percent
share, according to market research firm Ovum-RHK.
Global Marine Systems already has a Shanghai-based joint venture
with China Telecom, the fixed-line carrier in China. It also has a
joint venture in Japan with NTT and another one in Singapore with
SingTel and ACPL.
(China Daily May 16, 2007)