Asia scrambles to restore communications after quake

Asia scrambles to restore communications after quake
By Donald Greenlees and Wayne Arnold

Thursday, December 28, 2006
HONG KONG
Several ships were on their way Thursday to repair regional
telecommunications cables broken by an earthquake off southern Taiwan,
but officials warned that it could take several more days before
Internet access across much of Asia returned to normal.

Telecommunications companies and regulators in several countries said
that fixed-line and mobile international telephone connections were
largely back on line, two days after a quake with a magnitude of 6.7
struck the Luzon Strait, killing two people and causing property damage
in Taiwan.

The Office of the Telecommunications Authority in Hong Kong said six
out of seven submarine cable systems of the regional network,
accounting for 90 percent of telecommunications capacity of the region,
had broken "one by one" in the quake and its aftershocks.

The cables link countries in North and Southeast Asia to each other and
to North America, and the disruption has underscored the vulnerability
of the telecommunications infrastructure that the fast-growing region
depends on for normal commercial activity.

Banking services, particularly international transactions, were
severely interrupted Wednesday, but banks across the region reported
that services had resumed after networks were configured to make
detours around the broken cables. However, access to international
transactions at automated teller machines continued to be affected in
some places, and access to international Web sites was spotty.

Two cable maintenance ships from Singapore and the Philippines were
headed to the site of the broken cables, and three more were due to
depart soon, the Hong Kong telecommunications authority said.

Once they are there, it could take five to seven days to carry out
repairs.

A technician in Singapore with knowledge of the situation said that the
speed of the repair work would depend on how quickly the crews could
find the severed ends of the cables, some of which have suffered
several breaks.

While undersea cables are occasionally damaged by ships' anchors or
fishing nets, repairing them after an earthquake is likely to be much
more complicated, he said. The severed ends could have been buried by
deep-sea landslides or washed several kilometers from their positions
on the seabed, said the technician, who asked not to be identified
because his company was not authorized by its partners to speak about
the issue.

Most telecommunications companies were able to restore international
voice calls Thursday by rerouting traffic to satellites and other
cables unaffected by the earthquake.

In Taiwan, officials of the biggest telecommunications company,
Chunghwa Telecom, said that they had restored 80 percent of telephone
service and 95 percent of Internet service by Thursday, The Associated
Press reported from Taipei.

Hong Kong's biggest telecommunications carrier, PCCW, also brought
international telephone service back to normal. But a spokesman said
that Internet data capacity was "still congested."

NTT Communications, the biggest Japanese carrier, said that services on
87 percent of its damaged corporate data lines resumed Thursday,
Bloomberg News reported.

But the financial impact of the outage has been limited by the fact
that many executives and traders are still away for the holidays.
Markets were quiet and trading light. The outage seemed largely to
enforce the lull that typically takes over Asia each year.

"Business has dried up in the past week anyway, so there's not a lot of
things people are doing anyway," said Joel Kim, a fund manager for ING
Investment Management in Hong Kong.

No Sang Chil, a currency dealer at Kookmin Bank of South Korea, said
that his office had resorted to the telephone to conduct currency
transactions until Thursday afternoon, when the Reuters information
service came back up.

"That was possible partly because this time of the year is a slow
season in currency dealings," he said.

It remained unclear just how business would be affected once
vacationers began returning to their offices Wednesday and commerce
started to pick back up.

"It's something that will affect trading volume and might even
exacerbate price actions," said Joseph Tan, an economist at Standard
Chartered in Singapore. "Because we don't have all the speed to the
market, you don't have all the liquidity."

Operators confirmed that six of the cables linking Southeast Asia to
Northeast Asia and the United States were damaged by the earthquake
Wednesday. Among them:

The 19,000-kilometer, or 11,800-mile, APCN-2, a $1.1 billion cable
built in 2001 linking China, Hong Kong, Japan, South Korea, Malaysia,
the Philippines, Singapore and Taiwan.

The north Asian loop, or SEA-ME- WE3, a 39,000-kilometer cable
stretching from South Korea around the Eurasian landmass to the
Netherlands.

C2C, a $2 billion, 17,000-kilometer cable built in 2002 linking China,
Hong Kong, Japan, South Korea, the Philippines, Singapore and Taiwan to
the United States.

Chris Yeong at C2C in Singapore said that the operator was still
consulting with technicians. "We do have some plans to bring up the
circuit as soon as possible via other cable owners who have capacity
and aren't affected."

Further casualties of the quake were two cables belonging to FLAG
Telecom, a round-the-world cable project that went public at the height
of the dot-com boom only to go broke in 2002. Restructured under new
ownership, FLAG said that it has already booked a repair vessel, and
that fixing its cables could take up to three weeks.

The only major cable in the area that appears to have escaped trouble
was the EAC, or East Asia Crossing, cable belonging to Asia Netcom, a
subsidiary of China Netcom. The 19,500-kilometer cable, formerly owned
by Asia Global Crossing, connects China, Hong Kong, South Korea, Japan,
the Philippines, Singapore and Taiwan. A spokesman for the company in
Singapore, Clement Teo, said that the EAC had been hit by the
earthquake but remained operational.

After at least a day of outages, traders said that their Bloomberg
financial information terminals were sputtering back to life.
Bloomberg's rival financial information provider, Reuters, pulled off
what many traders called a minor coup by keeping most of its systems
running through Wednesday. Donald McCulloch, IT director of Reuters in
Singapore, credited the fact that the company houses its information in
Singapore, but backs it up to a separate site in Hong Kong.

"We live in a global Internet ecosystem, so when a large part of the
world goes dark, companies that run on information take a huge hit,"
said Rob Enderle, president of Enderle Group, a technology consultancy
based in San Jose, California. "Trading institutions, for example, can
lose millions of dollars in a minute, so not being able to access
information for hours or days can be catastrophic."

Although access appears to have been restored across most of the
region, Enderle predicted that the total bill for Asian
telecommunications companies could rise into the hundreds of millions
of dollars. "They are now using secondary services that are generally
slower and often more expensive," Enderle said, referring to backup
cable lines and satellites. "But they are still having to sell the
service for same price as before, so that eats into revenue."

BT, the British telecommunications operator, said that its voice and
Internet services in Taiwan and parts of China had been largely
restored as of early Thursday, after being disabled for about 24 hours
after the quake hit. "At one stage, we couldn't get any calls into
Taiwan, and there was severe congestion on lines to Beijing and
Shanghai," said Leslie King, a BT spokesman in London.

Western Union said that service on two of the seven Asian cable lines
it used had been disrupted by the quake and that "isolated"
money-transfer agents in Taiwan, Indonesia, Hong Kong, Brunei and
Cambodia had been affected.

DHL, the global logistics company, returned to normal operations after
its telecommunications providers re-routed its communications, said
Anil Talwar, DHL's vice president for services management in Singapore.
DHL backs up its data in Malaysia, the Czech Republic and the United
States, but the troubles this week highlighted yet another risk.

While businesses typically think that having two service providers
protects them, he said, "The question is: 'If both of the links go
down, what will you do?'"

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