The future of undersea Internet cables: Are big tech companies forming a cartel?

Well, they did specifically say it's not a cartel. Yet. I interpreted the article as an early warning to prevent them from becoming a cartel, as the author believes they have the capability to become one if they decide to.

> First, what is the function of a cartel? It's to coordinate supply to keep prices high.

No, it's to coordinate to keep profits high. Prices could fall, but less quickly than they would otherwise, and it could still be due to coordinated action. One example is if costs are falling quicker than prices, and prices drops are delayed or reduced. If consumers are hurt because they've altered the economics of the market to prevent competition, that would qualify for me.

> Do we really think that anything the content players have done so far would indicate any of them are trying to set pricing higher? Hardly.

Theoretically, they could make the market economics of new cables harder to justify, while keeping enhanced capability for themselves. Does affecting the world market to the degree that it would take a nation state to have enough money to change the status quo enough to allow competition in the data transit space count as anti-competitive? It may be that the term encompasses a lot more behavior when applied at that scale.

Do the companies in question have enough resources and power to affect the global market in that way? I have no idea. It sounds crazy, but it feels like there's more consolidation of power in these companies (with regard to online content) than other industries have had in the past, and with an industry that's as large and lucrative as this, that seems to make them somewhat unique. The dark horse here might end up being China. If there was a cartel, China would have the capability and motive to bust it eventually. Of course, if the markets China wanted to reach were politically denied from specialized lobbying, that could counter them...

They can, you know, contract it to an independent company. That's how most businesses in the world operate.

We're moving towards a world where Google can potentially control your computer (Android/Chromebook), your internet connection (Google Fiber), the backbone cables (article), your content (YouTube, etc) and your servers (to some extent). They are already entrenched in some of those markets.

https://en.wikipedia.org/wiki/Natural_monopoly

Working for BT I found that there was a a whole other set of contracts and company procedures just for those employees who worked on the cable laying ships.

> Don’t worry though — we are nowhere near such a scenario. Yet.

An undersea cable will go through (or around) all kinds of trenches or peaks because the sea bed isn’t flat. And it needs to have some stress relief imperfect routing to handle shifting.

Then nobody risks trying to take you on again.

It's nice that big users of data may be bigger than the telecoms, but when that isn't the case, the market fails when building your own links on a larger network of oligopolists.

> That being said, I do believe the notion of big corporations with pre-existing near monopolies on e.g. search or online retail with yearly revenues exceeding the gross national product of most nations on this planet, is not necessarily good for a free market

To me, those two statements sound contradictory. Do you want a "free market" or don't you? If it's a free market, you have to expect that the organizations with the deepest pockets that stand to gain the most from larger internet pipes are going to be the ones to invest in it.

I'm certainly no expert, but it seems to me that the more ideal situation would be that core infrastructure like the internet is driven primarily by public money. The obvious argument against that is maybe it won't grow as phenomenally fast as it has, but maybe we don't really need to be able to stream those 4K cat videos when, like you said, in doing so we're empowering for-profit organizations to grow larger than the GDP of many nations.

> There have been some demands for some of these companies to be broken up and IMHO that would actually be a good thing.

At least we're in 100% agreement here!

I'm all for distributed networks, local meshes, and other initiatives to reduce network hardware centralization. That said, these are not perfect substitutes for a global network. For instance: I'm based in Canada, and my work currently deals with digital service deployment in government. As part of that work, I occasionally need to refer to the UK's Government Digital Service (GDS) website. No amount of local network infrastructure can help me do that: I rely on the trans-Atlantic cables to access this.

Now, you could imagine mirroring the GDS website across a number of these local distributed networks, forming what is in essence a CDN under distributed ownership. That might help me right now, but: in a network monopoly world, how would you mirror content on an ongoing basis in the first place? Who would maintain such a mirror? How would you pay for the immense storage requirements? (Or, failing that, how would you decide which corner of the Internet to mirror?)