Brisbane telco Pipe Network is set to unveil a $200 million underwater cable link to the US island of Guam, capitalizing on the booming internet traffic and also to cut broadband costs for Australians.
The project, named Runway, will pitch the group into direct competition between Telstra and the Southern Cross cable owned by Telecom New Zealand and Optus (SingTel).
The new link will be known as Pipe Pacific Cable 1 (PPC-1) and the group is using the US island as it has multiple connections to Hawaii, the US West Coast and parts of Asia. In March last year, Telstra announced that it would build its own underwater cable to Hawaii at a cost of $300 million.
That contract was won by Alcatel-Lucent, the Paris-based telecommunications network maker.
Until now, The Southern Cross cable had a tight grip on the US-bound internet traffic.
The project is expected to be announced in Melbourne by the Communications Minister Stephen Conroy. The Brisbane telco has been highly critical of the national fiber-to-the-node (FTTN) network which the government is spending about $4.7 million.
Executive director Llyod Ernst declined to comment ahead of the announcement on Monday.