From Chips to the Seabed: US-China Rivalry Targets the Internet’s Arteries
Technological competition between the United States and China is expanding into undersea digital infrastructure, amid growing concerns about the security of submarine cables carrying more than 95% of data flows and supporting trillions of dollars in daily financial transactions.
Against this backdrop, countries and companies are seeking to redraw cable routes to reduce security and geopolitical risks. These efforts accompany initiatives to strengthen existing networks and develop alternatives to maritime passages most vulnerable to disruption, according to Bloomberg.
At a regional defence meeting in Singapore earlier this year, Australian Defence Minister Richard Marles described the seabed as a battlefield, highlighting the growing importance of submarine cable security.
Australia, the United Kingdom and the United States subsequently announced a project to develop underwater drone technology to protect cables by 2027.
Singapore also launched a framework involving seventeen countries across Southeast Asia, Europe, the Middle East and Oceania to explore cooperation on protecting critical infrastructure.
Maritime Straits Reshape Cable Routes
Companies developing digital infrastructure in Southeast Asia face the challenge of avoiding maritime chokepoints and risks associated with China’s maritime expansion.
The Strait of Malacca, between Indonesia, Malaysia and Singapore, stands out as vulnerable because of the high concentration of cables passing through it.
The Sunda Strait is another important Indo-Pacific chokepoint, carrying approximately 21% of global maritime trade by value. Major privately funded submarine cable projects, however, are choosing to bypass it.
They include Google’s TalayLink, which will connect Australia and Thailand across the Indian Ocean along a route west of the busy strait.
The challenges extend beyond maritime geography. Competition over cable routes is also intensifying in the South China Sea, where China uses regulation and maritime oversight to influence which actors can build and repair cable infrastructure in disputed waters.
China and Infrastructure Restrictions
US technology companies are adjusting their networks to reduce reliance on China. Google and Meta’s Echo cable illustrates this shift, connecting the United States to Singapore through Guam and Indonesia.
The companies opted to avoid China despite additional costs and the risks of laying cables in less favourable areas.
Samuel Bashfield, a submarine cable specialist at La Trobe University in Melbourne, said cable-laying companies had become more cautious about operating in the South China Sea, with many avoiding it altogether.
He added that Chinese coastguard vessels harass maintenance teams or prevent them from reaching cable sites, while burdensome licensing requirements are imposed on non-Chinese undersea fibre-optic projects.
According to Bashfield, delays have prompted some projects to move closer to coastlines and into shallower waters, a less favourable option for network resilience.
One example is the $700 million Asia Connect cable system, led by start-up Inligo Networks, which skirts the South China Sea through Indonesia and the Philippines.
The Pacific Light Cable Network, connecting the United States to Taiwan and the Philippines, was also rerouted after its planned Hong Kong connection was cancelled following US intervention.
Competition for Influence Extends to Data Centres
The United States has sought to persuade Southeast Asian and Pacific countries to avoid Chinese suppliers and choose American, Japanese or European alternatives.
Both Washington and Beijing fear that foreign involvement in cable infrastructure could enable intelligence gathering or sabotage, and each regards the other’s equipment as a security risk.
In 2019, Huawei agreed to sell its 51% stake in Huawei Marine Networks to China’s Hengtong Optic-Electric, which later acquired the British partner’s stake.
The company was renamed HMN Technologies. Its ownership and technological origins nevertheless prompted the United States and allies, including Japan and Australia, to seek to limit its use in Asia.
In August, Australia announced that all Pacific Islands Forum members had been connected to the global submarine cable network for the first time. That does not, however, mean Chinese companies have been entirely excluded from the region.
Data centres are emerging as the next arena of competition. Countries financing submarine cables must also help build the infrastructure needed to store and process data locally. Otherwise, recipient countries may turn to Chinese suppliers to fill the gap.
Japan is central to this effort as both a connectivity hub between North America and Asia and a submarine cable manufacturer. NEC is among the world’s leading producers.
Tokyo needs to leverage cooperation with the Quadrilateral Security Dialogue, comprising the United States, Japan, India and Australia, and with the Association of Southeast Asian Nations to strengthen cable-laying capabilities and limit Chinese dominance.
With ASEAN and Quad leaders’ meetings approaching in Manila next month, submarine cable security is an issue demanding attention. Efforts to reduce Beijing’s influence nevertheless raise another paradox: substantial control over vital cable routes is concentrated in the hands of a small number of American technology companies.
