De-regulation & Demand for Improved Reliability Provides Investment Opportunities in Indian Ocean, Persian Gulf & Red Sea, says Pioneer Consulting.

Business Editors

BOSTON--(BUSINESS WIRE)--April 20, 2004

Bandwidth Demand for Regional Systems Seen Driving Growth at nearly 50% per year

De-regulation is encouraging new and incumbent operators to expand beyond their domestic markets and to meet demand for increased choice and redundancy on ultra-long haul routes. But the main driver of future investment growth will be demand for connectivity and route diversity on shorter-haul routes between countries in the same region. These are the conclusions of Pioneer Consulting's New Business Models for the Indian Ocean, Persian Gulf, & Red Sea Submarine Cable Industries report which analyzes the supply-demand balances in each of 21 countries.

Total Cumulative Demand for Peak Hour Capacity in all Indian Ocean,
Persian Gulf, & Red Sea Countries

     (Gbps)       2003    2004     2005     2006     2007     2008
----------------------------------------------------------------------
Intercontinental
 Connectivity     160      339      568      823      975     1,129
----------------------------------------------------------------------
Intra-regional
 Connectivity      40       99      191      301      405       503
----------------------------------------------------------------------


     (Gbps)       2009     2010     2011     2012     2013     CAGR
----------------------------------------------------------------------
Intercontinental
 Connectivity    1,300    1,548    1,948    2,663    3,918      38%
----------------------------------------------------------------------
Intra-regional
 Connectivity      613      759      982    1,332    1,914      47%
----------------------------------------------------------------------

Outsourcing to India is providing a rationale for greatly increasing the level of international connectivity but Pioneer argues that this

phenomenon is only one of a number of drivers affecting demand for bandwidth in this region. The pace of development in the Persian Gulf is more measured but, with the eyes of the World upon them, most countries have now committed to market liberalization. Government-backed infrastructural investment in certain Red Sea states is also creating new opportunities. This dynamic commercial environment is spawning new business models. Pioneer's report weighs up the pros and cons of various models for submarine cable construction and operation.

"While there is a certain synergy between these regions, there are key differences in the way that demand for submarine cable connectivity is developing," said Julian Rawle, Senior Market Analyst at Pioneer Consulting, "And this in turn affects the efficacy of various business models used to take advantage of the opportunities which undoubtedly exist in this part of the world."

New Business Models for the Indian Ocean, Persian Gulf, & Red Sea Submarine Cable Industries provides forecasts of supply and demand for each country over the next ten years. The report distinguishes between ultra-long haul "intercontinental" demand and demand for "intra-regional" connectivity between neighbouring states.

The forecasts are backed up by a detailed profile of each country which provides a wealth of data points, as well as a qualitative assessment of country-specific demand drivers.

Description and analysis of potential business models is supported by comprehensive descriptions of each existing, planned, and proposed cable system.

"What we found," says Rawle, "is that entrepreneurship is a defining characteristic of the Indian Ocean region, while the Persian Gulf region is driven more by incumbents looking to defend their market position or re-invent themselves. So when you look at a cable system connecting the two regions you end up with some innovative hybrid business models."

Further information

For more information on the New Business Models for the Indian Ocean, Persian Gulf, & Red Sea Submarine Cable Industries, including an abridged version of the executive summary, just click on the following link: http://www.pioneerconsulting.com/report.php3?report=43 or contact us at: [e-mail].

About Pioneer Consulting, LLC

Pioneer Consulting is a highly regarded international market research and analysis firm specializing in worldwide broadband telecommunications networks and technologies. Since its inception in 1997, Pioneer has rapidly become a trusted leader in providing high quality, objective analytical telecom research to many of the world's major network equipment vendors, carriers, service providers, and financial institutions. For more information on Pioneer Consulting and its products and services visit the company's Web site www.pioneerconsulting.com