Big tech and geopolitics are reshaping the internet’s plumbing

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Big tech and geopolitics are reshaping the internet’s plumbing

The Economist | December 20, 2023

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When the navies of Britain, Estonia and Finland held a joint exercise in the Baltic Sea earlier this month, their goal was not to hone warfighting skills. Instead, the forces were training to protect undersea gas and data pipelines from sabotage. The drills followed events in October when submarine cables in the region were damaged. 

Submarine cables used to be seen as the internet’s dull plumbing. Now giants of the data economy, such as Amazon, Google, Meta and Microsoft, are asserting more control over the flow of data, even as tensions between China and America risk splintering the world’s digital infrastructure. The result is to turn undersea cables into prized economic and strategic assets.

Until the early 2000s subsea cables were mainly used for transporting voice traffic across the world. Telecom operators like bt and Orange (formerly France Telecom) controlled most of the capacity. By 2010 the rise in data traffic led internet and cloud-computing giants—Amazon, Google, Meta and Microsoft—to start leasing capacity on these lines.  As their data needs surged, the tech firms began investing in their own pipes. In 2012 the four companies used around a tenth of international bandwidth; nowadays they claim almost three-quarters. Big tech’s deep pockets ensure that projects are completed.

Like many other global industries, the data-cable business is also being entangled in the tech contest between America and China—a second big shift.  Despite the growing Sino-American rivalry, from 2019 to 2023 bandwidth between the two has grown by 20% a year. American and Chinese mobile operators, which also rely on cables, continue to increase network connectivity in each other’s territory. The necessary licences are, however, getting harder to secure.  All this is making the route taken by bits and bytes more circuitous than before, and thus costlier. If transpacific tensions continue to mount, those routes may one day vanish altogether.

2 key takeaways from the article

1. Until the early 2000s subsea cables were mainly used for transporting voice traffic across the world. Telecom operators like bt and Orange (formerly France Telecom) controlled most of the capacity. By 2010 the rise in data traffic led internet and cloud-computing giants—Amazon, Google, Meta and Microsoft—to start leasing capacity on these lines.
2. Like many other global industries, the data-cable business is also being entangled in the tech contest between America and China—a second big shift.

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Topics:  Technology, Data Cables, USA, China