Our own experience – how is the industry changing on the ground?
It’s not only new capacity growth models that are disruptive, we all feel significant structural changes coming into the industry. MD Pete Fisk touches on ownership, critical network infrastructure and global permitting with a perspective on the top 5 industry influencing issues he is seeing from system commissioning down to vessel operations.
1. The ownership model
It’s been happening gradually over the last 5 years, but owning cables now is increasingly a financial conglomerate operation. For instance, looking at Seabras1 supported by global equities investors, such as Partners group and in South America, Werthein Group, the financiers, not Telcos are often now driving deployment. The attraction for these organisations are the cash returns and the interest from the biggest tech companies on the planet. For us engineers, we need to challenge some of the ROI assumptions and thus understanding the sometimes complex financial structures is now a prerequisite.
2. From Telco to Tech
This is a mainstream point but there are significant implications. The Independent October 2015: “Historically, undersea cables were paid for by telecom consortiums. But in recent years, OTT tech companies started getting in on the game, putting big bucks behind the infrastructure that’s made the shift to an always connected world possible’”.
The world where the telcos are chasing the tech and big financial platforms for business sets a very different set of priorities for the cable laying industry. There is a danger that we dilute some of the engineering expertise ‘wired-in’ to the business of telecommunications. It’s up to us to help mitigate that risk – given that the momentum behind this change is only going to accelerate. It is now down to the OTT’s to grow or hire their subsea cable expertise. It’s starting to happen already and we should support it. A collaborative sector with shared skills from a core network of professionals will benefit everyone.
3. Global permitting complexity
Whilst to an extent it is in Pelagian’s interests to keep the marine permitting world complex and fractured, as capacity grows exponentially, developing industries such as wind farms share some of the engineering expertise.
As environmental considerations become increasingly global, it seems the industry would benefit from a holistic look at best practice permitting. Is the Australian position of absolute protection and operational enforcement of no-shipping zones the only sensible route for critical infrastructure? We can see the potential for a rating system ascribed to levels of risk for coastal waters as cable laying areas. There are also already jurisdictions that have standardised their permitting processes and the cable routes are pre-established.
An aspiration towards an all-condition approach should work no matter what the regime is in place.
Early integration by system owners prior to supplier selection can aid this process – it is starting to happen and it is an industry obligation to share best practice and realise the value of early integration.
4. The politics of Critical Networks Infrastructure
Pelagian is an engineering firm, not a lobbying group – however increasingly I recognise a need for a specialist advice capability within Governments around the world on the place of subsea cables as part of Critical Network Infrastructure(CNI). Web search CNI and you get all the infrastructure you can think of on IT, security and power – except for anything to do with subsea cables.
Our lobbying capacity as an industry needs to be given some momentum – maybe this is where we bring in the firepower of the giant techs. National security issues are increasingly going to be bound up in the ability to protect data integrity and transit. Did this sit anywhere in the manifestos of the political parties in the recent UK election? I’d like to see how we as an industry could take a leaf from the environmental lobby – who have made a compelling and audible case for the environment as ‘tier-1’ issue. Even as introspective engineers we all know someone who knows someone pulling the strings. To make CNI and subsea cable a tier-1 issue, better we pull together.
5. Personnel deployment
We have always operated with one of the largest deployable personnel database in the industry, with the value-add from centralisation of the deployment .through a highly experienced hub. We all too often now see the singleton post deployed in isolation across projects that has cost advantages but loses coordination and support functions – it represents a product being provided rather than a solution. We need to engage with the new commissioning groups at a more strategic level to better demonstrate the value of collaborative team expertise – especially in system construction. This also enhances the efficiency of complex multi vessel operations – for instance reducing risk of stand-by time.