Internet cable connecting NZ, Chile and Australia could create data centre industry in Southland
Monday, 27 July 2020
Invercargill has a realistic chance of being connected with a new fibre-optic cable running between Sydney and Chile, giving hopes of building a data centre industry in Southland a huge boost.
Chilean newspaper El Mercuriro reported overnight that the Chilean government planned to build a subsea cable linking Valparaiso in Chile, Sydney and New Zealand, modifying a proposal it was investigating last year for a cable between Chile and China.
Remi Galasso, founder of Auckland firm Hawaiki cable, told Stuff he had been in discussions with Chilean telecommunications agency SubTel about the idea of laying the cable south of New Zealand, and hopes to invest in a spur to Invercargill and Antarctica.
Galasso defied sceptics in 2018, when Hawaiki built a $445 million internet cable between New Zealand, Australia and the US, breaking Southern Cross Cable’s former monopoly on the US-New Zealand route.
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A Southland link on the Chilean cable would be his own venture, separate to Hawaiki, Galasso said.
Energy Minister Megan Woods has cited data centres as a possible example of an industry that could absorb some of the excess electricity from the Manapouri hydro scheme and provide local employment if Rio Tinto closes the Tiwai Point aluminium smelter as planned next year.
But one drawback with that plan has been the lack of a direct internet link to major overseas markets.
Galasso said he had been in contact with SubTel for some time and its cable could provide a solution.
The cable between Chile and Australia could run either north or south of New Zealand, but the southern route would be shorter, he said.
“It would allow Invercargill and Antarctica connectivity.”
Galasso noted that all of the subsea cables currently connecting New Zealand landed in the North Island.
A connection between the South Island and Sydney would improve the “redundancy” of those links, he said.
“In terms of diversity, it is also good to have another path.”
The potential was there for a data centre industry in Invercargill, he said.
“We are aware of these fantastic hydro plants that could provide cheap, green power to data centres, but ‘no connectivity, no data centre’.
“Connectivity is ‘a must’.”
It would be easy to land a cable near Invercargill, he said.
“There is so much land there, it is very convenient.'
The termination of the proposal to build a cable from Chile all the way to China at an expected cost of US$500m (NZ$750m) may come as a relief to the New Zealand government which won’t now have to decide whether to give that cable landing rights.
El Mercuriro reported that US Secretary of State Mike Pompeo lobbied against the China-Chile cable plan and raised concerns about Chinese interest in digital technology in South America more generally during a visit to Chile last year.