Australian cable company Vocus has joined the chorus warning about the shortage of undersea capacity. Simon Parker, Vocus’s strategic sales director, stated that the company is witnessing a “tsunami of capacity demand,” while industry inventory is dwindling.

“This applies not only to activated capacity but is even more critical for us in terms of the underlying fiber optics that physically support this capacity,” Parker stated during an online event last week. “Our customers aren’t just asking to double or quadruple their existing capacity. Some are demanding a 100-fold increase.”

Vocus operates domestic submarine and terrestrial capacity in Australia, as well as a primary route to Singapore, and also holds a stake in a cross-Pacific cable owned by Google.

Parker stated that one approach to addressing surging demand is to maximize the capacity of existing fiber optic cables, which requires close collaboration with supply chain partners. Another solution is to build new capacity, but most of the construction resources have already been monopolized by hyperscale cloud service providers.

Severely scarce supply

“We need the manufacturing schedule for optical cables, offshore installation vessels, and licensing approvals. We also require professionals to operate these projects. These are critically scarce resources, as hyperscale cloud providers are consuming them themselves.”

Parker stated that these resources are also largely locked in beyond 2030, meaning the only option is to collaborate closely with the American giants driving this wave of construction.

He acknowledged that this approach was rejected by others in the industry, as there were concerns that relying on these foreign heavyweight firms might result in a loss of control over domestic and regional infrastructure. He said Vocus also shared some of these concerns, but he believed that the so-called sovereign investment alternatives people advocated simply did not exist.

He stated that hyperscale cloud providers and emerging cloud providers “are the only parties with financial resources capable of building specialized infrastructure for the AI ecosystem, and possess the scale and speed required at this moment.”

Parker is also one of those who are not worried about the AI bubble. He said that unlike the internet bubble era, the massive cloud service providers driving AI investment have real balance sheets behind them and are meeting genuine demand.