Africa Coast to Europe (ACE) Submarine Cable Consortium, Research Paper Example

Communication has always been a major concern in business, and has become even more so in the advent of globalization. Thus, it is no surprise that many organizations across history have joined together to embark on various consortia towards installing means through which people and businesses can communicate with one another across countries and continents. This essay focuses on one such consortium, dubbed the Africa Coast to Europe consortium or ACE, which seeks to construct and manage a submarine communications cable along the African west coast that will be able to connect all countries between South Africa and France (Léger & Gassama, 2010). In particular, the succeeding paragraphs give a background on ACE and discuss the nature of this consortium, before evaluating the role of each of the public and private players in the consortium. Furthermore, the essay will assess the effect of having such a consortium undertake the given project.

ACE is an example of a commercial consortium; where public and private organizations come together in order to accomplish a project that intends to fulfill the respective players’ financial objectives (Stonehouse et al., 2000). Specifically, ACE is an infrastructure building consortium, much like an example given in Stonehouse et al. (2000) of various companies working together to construct the channel tunnel connecting Britain and France. However, instead of seeking to create a path through which to transfer physical goods, ACE seeks to create pathways to transfer information and communication at near-instantaneous speeds. The submarine cable system was initially planned to just reach Gabon from France (Audra, 2009). However, interest across different countries and telecommunications companies has led to the expansion of the project to South Africa (Audra, 2009). The current configuration of the project is to install a 17,000 km-long fiber optic cable, originating from France and reaching all the way down the globe to South Africa by the second quarter of 2012 (Léger & Gassama, 2010). There will be 23 countries that will be directly connected to this cable (Léger & Gassama, 2010). The coastal territories will be connected directly through submarine cables while landlocked countries will receive their connection via secure telecom towers tapping to central hubs (Léger & Gassama, 2010). Touré (2009) shows the path and direct connections that the cable is expected to make upon completion. The ACE submarine cable is to be the first international submarine cable to directly connect countries such as the Democratic Republic of Congo, Equatorial Guinea, Guinea, Liberia, Mauritania, Namibia, The Gambia, Sao Tome and Principe and Sierra Leone to the internet (Touré, 2009). Aside from these countries, other countries that already have access points to the internet would benefit significantly from the more direct access provided by the cable. These are Angola, Benin, Cameroon, Côte d’Ivoire, France, Gabon, Ghana, Mali, Niger, Nigeria, Portugal, Senegal, South Africa and Spain (Touré, 2009).

There are 19 signatories to the consortium, which includes the construction and management of the submarine cable. This means that 19 organizations have agreed to collectively share the responsibilities in completing the project. These are the Baharicom Development Company, the Cable Consortium of Liberia, the Companhia Santomense de Telecomunicações, Côte d’Ivoire Telecom, Expresso Telecom Group, France Telecom, Gambia Telecommunications Company, International Mauritania Telecom, Office Congolais des Postes et Télécommunications, Orange Cameroun, Orange Guinée, Orange Mali, Orange Niger, PT Comunicações, Republic of Equatorial Guinea, Republic of Gabon, Sierra Leone Cable Company, Sonatel and Sotelgui (Léger & Gassama, 2010). Among the signatories are several private telecommunications companies, governments of countries where the submarine cable is to pass through, and Baharicom Development Company, a telecommunications infrastructure company. The role of the telecommunications companies is mainly the direct funding of the project through their revenues. Since these private entities have the most to gain financially from the venture, they are the ones who are footing most of the bill for the construction and management of the submarine cable. In exchange for this, they will be awarded rights to the distribution of their services using the submarine cable, which would enable them to offer better prices than their competitors, and thereby gain competitive advantage. The public institutions involved in the consortium are entire governments, particularly through their respective telecommunications departments such as Congo’s Office Congolais des Postes et Télécommunications. These public institutions also give some funding to the project, but mostly contribute the use of their territories to the construction of the submarine cable, and regulate the participation of their respective private telecommunication companies in the project. These governments stand to gain greater revenue from the progress that the new submarine cables would bring to their respective territories. Such institutions are also interested in bringing down private telecommunication costs for their constituents, which would greatly increase their population’s standard of living.

The infrastructure developer, Baharicom Development Company is the main mover in the project, as it is the organization that will coordinate the activities of all the other members of the consortium. It acts as the “carrier’s carrier, providing a full spectrum of Internet, voice and data services to telecommunication carriers, Internet Service Providers and others.” (Singhi & Henderson, 2010). The entire project therefore relies on Baharicom’s ability to consolidate the funding and construction of the submarine line while conforming to regulatory requirements of the countries where the line would be passing.

While the rest of the world enjoyed the benefit of high-speed data transfer and telecommunications brought about by the advent of satellites, cellular networks, and submarine fiber optic cables, many countries in Africa have been left behind. This is because such countries are unable to support their own projects to build stronger infrastructures for telecommunication. Similarly, the private companies in such countries have no choice but to tap indirect routes to secure access to the internet, which lead them to be unable to offer competitive prices to their target markets. With the establishment of the ACE consortium, it will at last become possible for fast and affordable telecommunications and data transfer services to be offered in many African countries. This is far from a philanthropic goal, since telecommunications companies and governments alike intend to get the most out of their participation through the progress that the cable would generate. Nevertheless, it is through the consolidation of their resources that the ACE project will become a reality.

A consortium of public and private institutions can be a very powerful alliance towards the competition of significant projects that can potentially bestow immense benefits to all parties involved. This essay’s discussion of the ACE consortium is clear evidence of this.

References

Audra, A. (2009). ACE (Africa Coast to Europe) submarine cable extended to South Africa. Retrieved November 5, 2010 from: http://www.francetelecom.com/en_EN/press/press_releases/att00012462/ACE_cable_Press_release-06092009.pdf

Léger, J., and Gassama, P. (2010). Africa Coast to Europe (ACE) Submarine Cable Consortium signs landmark Agreement in Paris. Retrieved November 5, 2010 from: http://www.orange.com/en_EN/press/press_releases/att00015869/ACEPressrelease-CMAsignatureEN.pdf

Singhi, M., and Henderson, R. (2010). Baharicom Signs Historic Agreement in Paris. Retrieved November 7, 2010 from: http://appablog.wordpress.com/2010/06/14/baharicom-signs-historic-agreement-in-paris/

Stonehouse, G., Campbell, J., Hamill, D., and Purdie, T. (2000). Global and Transnational Business: Strategy and Management. John Wiley & Sons.

Touré, S. (2009). ACE (Africa Coast to Europe) submarine cable welcomes new members. Retrieved November 5, 2010 from: http://www.orange.com/en_EN/press/press_releases/att00014018/PR_ACE_en_011209.pdf