Sources: Chinese state-owned telecoms are planning a $500M undersea fiber-optic internet cable network that would link Asia, the Middle East, and Europe
Joe Brock / Reuters : Tweets: @bonnieglaser Tweets: @bonnieglaser : Just one of an expanding number of areas of US-China competition: China plans $500 million subsea internet cable to rival U.S.-backed project https://www.reuters.com/...
Context & Ripple Effects
This plan is China's answer on the map where the last round was fought: just weeks earlier, the US had helped SubCom lock up a $600M Asia-Europe subsea cable bid over spying concerns, leaving Chinese carriers out of that route entirely. Rather than contest consortium bids where Washington holds leverage, Beijing's state-owned telecoms are now financing their own $500M network across Asia, the Middle East, and Europe.
First-order effects
- The US-backed SubCom project gains a direct state-funded competitor on the same Asia-Europe corridor, turning what was a single contested bid into two parallel builds.
- Chinese telecoms stop routing through Western-led consortia and absorb construction costs themselves, trading shared-capacity economics for full control of the landing stations.
Second-order effects
- Google, Meta, and other hyperscalers already warned about tampering by China-owned repair ships face a starker routing choice as more traffic shifts onto Chinese-built routes.
- The FCC's planned exclusion of Chinese equipment from cables touching the US hardens into a de facto supplier split, forcing cable vendors and consortium members to pick a side per route.
Third-order effects
- If the pattern holds, global subsea infrastructure splits into two largely separate networks — US Big Tech's 70%+ capacity share on one side, state-backed Chinese routes on the other — with Middle East landings becoming the contested hinge between them.
- Subsea cable ownership becomes an instrument of geopolitics rather than a neutral utility, echoing the broader export-control contest over chips and pushing regulators toward security vetting of every new landing.
The trend: Global internet plumbing is bifurcating into competing US- and China-aligned cable systems, with each side financing its own routes after losing consortium battles.