China v/s USA: Battle in the Oceans
The trade war is intensifying between the nations, and some companies are winning big.
The epic blockage of the Suez Canal by ship 'EverGiven', has made us realize that oceans are the backbone of international trade. But, not just the trade of physical goods. Over 95% of all international communications depend on the cables laid down on the ocean beds.
So it is important, but, also strategic. And Facebook and Google have taken the strategic call to lay down a cable along an unexplored route to connect The US and Singapore. Not like they wanted to, but they had to because the routes are a matter of national security. The cables can be tapped and data can be snooped by unwanted parties. And, a route they had earlier suggested was exposed to this risk.
The risk of data access by China as per The US Department of Justice. But, not the new route. Because you know, no one wants to give China, the 'power'. Do you?
Well, here's a fun fact…
A scandal broke in 2013 when Edward Snowden revealed that the US National Security Agency was hacking networks of the world all over. And, while the global superpowers strive for world dominance, there is another important shift that is happening.
The shift of financial benefits derived by telecom operators to tech companies. Why? Because the tech companies are increasingly investing more and more in laying down the cables.
Facebook's capital expenditure is expected to be 20% of its revenue for 2020, more than AT&T's 11%.
Why, you ask?
World dominance.
As data usage will keep increasing in the years to come, having their own dedicated cables will help them fend off rivals. Monopoly is not just for nations, it's for tech giants too.
But, for how long?
All the efforts for just the next 20-25 years (that's the longevity of a cable).
What's interesting is that while all of these companies are fighting for the land-bound infrastructure, there are a handful of visionaries (we see you, Elon Musk!) who are rebuilding the internet with low orbit satellites.
Phew! Looks like a lot many wars are being fought far from our eyes, deep in the oceans and high up in the sky.
But, do we really need a handful of winners to rule us all?
Only time will tell… till then, read on.
To read more about this in detail, here’s a Bloomberg article.
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