Alcatel-Lucent(ALU) recently announced that it has received a contract from a consortium of telecommunications companies for the deployment of undersea cable for the Tasman Global Access (“TGA”) system. This system is designed for connecting the New Zealand with Australia through a direct link of 2,300 km.
The consortium consists of Spark New Zealand, Australia based-Telstra and Vodafone New Zealand, a subsidiary of the Vodafone Group Public Limited Company (VOD).
The TGA system will have a high transmission capacity, the minimum speed being 20 Terabits per second (Tbit/s). Moreover, the system is expected to reduce the latency in the network across regions like Tasman Sea, Raglan in New Zealand and Narrabeen in Australia.
The initial tender for this contract was issued by Telecom New Zealand (presently Spark New Zealand), Vodafone and Telstra in 2013, and the project was scheduled to be completed within 2014 itself. However, as per media reports, the project was delayed owing to changes in ownership structure.
Alcatel-Lucent is now expected to start the construction of the cable in early 2015, so as to ensure that TGA is operational by mid-2016.
TGA, by offering an alternative route for data transfer across Tasmac, is expected to greatly enhance the international connectivity of the New Zealand, especially with the rapidly growing Asian regions.
On the other hand, the system will also augment the broadband connectivity across the whole of Australasia. Rising demand for high-speed data transmission for services like cloud computing, data centre requirements and content delivery for use in both government and enterprise work in the region, makes this project crucial for development of the regional economy.
Alcatel-Lucent holds an impressive record of providing connectivity solutions all across the globe. The company’s 100G technology is expected to significantly benefit this project.
Alcatel-Lucent currently carries a Zacks Rank #3 (Hold). A couple of better-ranked stocks that can be considered are 8×8 Inc. (EGHT) and Arista Networks, Inc. (ANET), both sporting a Zacks Rank #1 (Strong Buy).
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