Big Tech and the AI investment boom in underwater cables
More than 95% of international data and voice call traffic passes over nearly one million miles of underwater communications cables.
These cables enable government communications, financial transactions, emails, video calls, and broadcast broadcasts around the world.
The first commercial telecommunications submarine cable was used for telegraphy and was laid across the English Channel between Dover, England and Calais, France in 1850.
The technology then evolved into coaxial cables, which carry phone calls, and finally fiber optics, which carry data and the Internet as we know it.
“About a decade ago, we saw the emergence of another big category, web-scale players and the like. Meta, Google, Amazonetc. “It probably represents 50% of the overall market right now,” he said. Alcatel Submarine Networks.
According to industry magazine Submarine Telecoms Forum, Alcatel is the world’s largest submarine cable manufacturer and installer.
Demand for undersea cables is growing as tech giants race to develop computation-intensive AI models and connect growing data center networks.
According to telecommunications data provider TeleGeography, investment in new subsea cable projects is expected to reach approximately $13 billion between 2025 and 2027; This is almost double the investment made between 2022 and 2024.
Map of the world’s undersea communication cables.
CNBC | Jason Reginato
Big Tech, big cables
“AI is increasing our need for subsea infrastructure,” said Alex Aime, vice president of network investments at Meta. “A lot of times when people think of AI, they think of data centers, they think of computing, they think of data. But the reality is that when you don’t have the connectivity that connects those data centers, what you have are really expensive warehouses.”
In February, the company announced Project Waterworth, a 50,000-kilometer (31,000-mile) cable that will connect five continents and be the world’s longest undersea cable project.
Meta will be the sole owner of Waterworth, which the company says will be a multi-year, multibillion-dollar project.
Amazon also recently announced its first wholly owned company. Undersea cable project called Fastnet.
Fastnet will connect Maryland’s east coast to County Cork, Ireland, and according to Amazon, capacity will exceed 320 terabits per second, the equivalent of streaming 12.5 million HD movies simultaneously.
“Submarine is really important for AWS and international connectivity across oceans,” Matt Rehder, vice president of core networks for Amazon Web Services, told CNBC in an interview about Amazon’s subsea cable investments. “Without the submarine, you’d have to rely on satellite connectivity, which can work, too. But satellite has higher latency, costs more, and you don’t get enough capacity or throughput to meet the needs of our customers and the internet in general.”
An Alcatel Submarine Networks ship uses a plow to lay undersea telecommunications cables.
Alcatel Submarine Networks
Google is another big player that has invested in more than 30 submarine cables.
One of the company’s latest projects is Sol, which will connect the USA, Bermuda, the Azores and Spain.
Microsoft also invested in infrastructure.
“You’ve seen this huge growth in submarine cables over the last 20 years. And it’s driven by extreme demand for data,” says Matthew Mooney, director of global issues at cybersecurity firm Recorded Future.
Cut the cables
Outages caused by cable damage can be quite serious, especially in areas with poor internet connectivity.
“If you cut one cable, you can cut off multiple countries’ internet access, including financial transactions, banking, e-commerce and basic communications,” said Erin Murphy, a senior fellow at the Center for Strategic and International Studies, a nonprofit national security research organization.
The same thing happened to Tonga, an island nation east of Australia.
Debris from an underwater volcanic eruption in 2022 severed the island’s only undersea communications cable, cutting off the island from the rest of the world.
Outages in submarine cables in the Red Sea in September Outages in Microsoft’s Azure cloud service. The company was able to reroute traffic, but users in Asia and the Middle East still faced increased latency issues and poor performance.
The vast majority of subsea cable damage occurs accidentally, usually due to fishing activity or when a ship accidentally drops its anchor on a cable, experts said. However, lately these cables have become suspicious targets of sabotage.
An undersea cable is being produced at the Alcatel Submarine Networks factory in Calais, France.
CNBC
“When you have a large number of vessels in international waters that are highly trafficked by a large number of commercial vessels or fishing vessels, the probability of an accident is quite high,” Murphy said. “But if you’re a hostile actor, you know that, too. So if you’re sending out the so-called Russian stealth fleet, or you have a Chinese fishing boat and a cable is accidentally cut, you can say, ‘Oh, well, that was an accident.’ But it could be intentional. So sometimes it’s really hard to discern whether an act of harm is actually intentional or accidental.”
Mooney and Recorded Future are tracking some of these suspected cases of sabotage.
“I would say we have seen a significant increase in what we consider intentional harm,” Mooney said. “In 2024 and 2025 [we] There has been a significant increase in incidents around the Baltic Sea and Taiwan. Therefore, it is difficult to determine with 100% validity that these are intentional. “But the facts that emerge from these events make you doubt whether all of this can be considered coincidental.”
Mooney said the increase in suspicion of sabotage corresponded to rising tensions between Russia and Ukraine and between China and Taiwan.
Although there is no concrete evidence of submarine cable sabotage, governments are taking the threat seriously.
In January, NATO activated “Baltic Sentry” following several cable outage incidents in the Baltic Sea. The operation involves the deployment of unmanned aerial vehicles, aircraft, submarines and surface ships to protect undersea infrastructure in the region.
“The bottom line is that I do not believe we have seen any cable breaks in the Baltic Sea since late January 2025,” Mooney said.
In a photo taken on February 4, 2025, a Helicopter 15 (HKP15) (L) is seen on the flight deck of the offshore patrol ship HMS Carlskrona (P04) near Karlskrona, Sweden, as part of the NATO Baltic Sea patrol mission Baltic Sentinel, which aims to secure critical underwater infrastructure. Patrol ship HMS Carlskrona (P04) sailed from the seaport at Karlskrona on 4 February 2025 to be part of NATO’s Baltic Sentry operation as one of several Swedish ships that are part of Standing NATO Maritime Group One (SNMG1). The ship hoists the NATO flag on board for the first time. The aim of NATO’s Baltic Sentry operation is to demonstrate its presence and ensure the security of critical underwater infrastructure. (Photo: Johan NILSSON / TT NEWS AGENCY / AFP) / Sweden RELEASED (Photo: JOHAN NILSSON/TT NEWS AGENCY/AFP via Getty Images)
Johan Nilsson | Afp | Getty Images
US-China tension
In the United States, the Federal Communications Commission, which is responsible for issuing licenses to anyone who wants to build or operate undersea cables connecting to the United States, has imposed stricter rules on foreign companies building this infrastructure, citing security concerns.
“One of the areas we’re particularly focused on is threats from Russia as well as the Chinese Communist Party,” FCC Chairman Brendan Carr told CNBC. “So we are now taking action to make it difficult, or effectively prohibit, the ability to connect subsea cables directly from the United States to a foreign adversary country.”
Carr said the FCC is also taking steps to deny Huawei permission to make sure the hardware isn’t compromised. ZTE or other questionable “spy equipment” to be used in undersea cables.
Three Republicans from the House of Representatives in July sent a letter CEOs of Meta, Amazon, Google and Microsoft asking whether companies use cable maintenance providers affiliated with the People’s Republic of China.
In response to CNBC’s question about the letter, Meta’s Aime said, “We do not work with any Chinese cable system providers on the systems we announced and are fully compliant with US policy regulations regarding partners in the ecosystem and supply chain.”
Amazon also told CNBC that it does not work with Chinese companies.
Microsoft and Google did not respond to CNBC’s request for comment on the letter.
To understand how subsea cables work, CNBC visited Alcatel Submarine Network’s subsea cable manufacturing facilities in Calais, France, and Greenwich, England. We also spoke with government officials and tech giants to find out why undersea cables are vital to keeping us connected and what we can do to protect this critical infrastructure.
Watch the video to get the full story.
