Huawei gets another US knockback as already delayed trans-Atlantic cable is further "postponed"

Feb 14, 2013

Project Express is (or should that now be 'was'?) a planned new cable link across The Pond designed to support "high-frequency" trading systems with latency below 60 ms. Project Express was first sanctioned back in 2010 and was designed to provide four-pair repeatered fibre links for trading systems and dealing rooms in New York and London. Infrastructure necessary to the deployment of the cable system has been under construction for 13 months.

However, since the project got the "we will build it" nod back in January 2012, Huawei's star has plummeted to earth in the US on suspicions that the company's close links to the ruling Communist Party in China could be detrimental to the national good.

Such suspicions have already cost Huawei dear with the company's equipment being pre-selected out of consideration for a variety of major US infrastructure projects on the grounds that, if deployed, they would be a threat to national security.

In this latest case, US companies that were earlier involved in Project Express have backed-away on worries that to continue to support the deployment of Huawei kit, in terms either of economics or its technological capabilities, will almost certainly prejudice against the US government awarding prestigious federal infrastructure contracts to them in the future.

So, Project Express was already well behind its planned timetable when Hibernia Atlantic announced yesterday that "official concerns" have relegated the cable programme to the back-burner until "at least" the fourth quarter of 2104.

It is known that other companies, including Alcatel Lucent and TE SubCom, have been in contact with Hibernia Atlantic with a view to taking over Huawei's role in the cable build-out and Hibernia has said that a Board decision on the future of the project will be made late next month.

However, that decision is unlikely to be clear cut, not least because Huawei Marine, the division of the Chinese infrastructure company working directly with Hibernia Atlantic on Project Express is providing vendor financing for the deployment. Talk about wheels within wheels.

In an official statement, Huawei marine says it is "concerned" and "remains in close discussions" with its putative partner. There have also been murmurings about court cases and law suits.

Meanwhile and elsewhere, another national government seem to be rather more laid back about doing business with Huawei than does the Obama administration. Another cable project, this one (ASSC-1) running between Perth in Western Australia and Singapore, and bearing striking similarities to Project Express, is going ahead with Huawei Marine and Telstra seemingly working in harmony with one another on the deal.

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