Is Google the new Global Crossing?

by Mathew on September 21, 2007 · 3 comments

You know a Web company is getting big when they want their own undersea fiber-optic cable. According to a report at CommsDay, which appears to be a fairly reputable telecom site, Google is working on a plan with a group of other companies to lay an undersea cable to provide dedicated bandwidth between the U.S. and Asia. The perfect addition to the more than 35 massive, power and bandwidth-gobbling server farms the company runs.

Google’s involvement in this “Unity cable,” as it’s being called, would make plenty of sense. According to various reports, there is a glut of cable-laying ships, so a cable could be laid without costing too much — and owning a chunk of that bandwidth would give Google a cost advantage over Microsoft and Yahoo, the same rationale that has been given for buying all that “dark fiber” that the company has reportedly been accumulating.

So yes, it makes sense. But it still reminds me of Global Crossing, one of the stars of the late 1990s that eventually became one of the largest bankruptcies in U.S. history, with $12-billion in outstanding debt (the company was eventually acquired by Singapore Technologies).

Is Google in any danger of suffering the same fate? Unlikely. Global Crossing over-spent its way into debt, and made outlandish claims about the future demand for undersea bandwidth (claims which everyone agreed at the time were completely rational, of course). Google appears to simply be looking at buying a stake in one such cable. But it still makes me nervous :-)

  • http://blogs.globalcrossing.dom/dsiegel Dave Siegel

    Google seems to be suffering from a bit of identity crisis, don’t they. :-)

  • Joe Fiorito

    Check out this article. It contradicts the comment about a “glut of cable-laying ships” and seems to be from a credible source.

    http://www.telecomasia.net/article.php?type=article&id_article=5600

  • Steve L

    FYI – Global Crossing were not purchased by Hutchison. It was on the cards but could not gain US regulatory approval.
    Singapore Technologies Telemedia ended up going it alone.

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