Internet connections are more fragile and terrestrial than they seem. With approximately 99% of Internet travel occurring underseas, it’s surprising that outages aren’t more common. Knowing the level of connectivity to a particular country can help decision makers choose which countries their firm does business.
Analysis: The New Zealand Outage
A construction project in Sydney, Australia disrupted New Zealand’s Internet on March 21. Repairs to the fiber cable were made quickly, due to the land-based accessibility of the fiber cable. As it turns out, this is something of an anomaly: much of the globe’s country-to-country connectivity occurs underwater. One estimate from the World Economic Forum states that approximately 99% of global Internet traffic is routed across fewer than 300 cable systems.
Presumably, had an underwater connection been severed, the repair time would have been significantly increased, causing significant delays and potentially causing businesses to lose money. Moreover, had New Zealand not had a few redundancies in place (via other fiber cables connecting New Zealand to Australia), access to sites hosted in Australia would have been lost until the cable was fully repaired or replaced.
Connectivity: A Risk Assessment
Such a situation is possible, especially in emerging markets where Internet connectivity is reliant on one or more nodes of connectivity. A brief look at a submarine cable map shows that while the United States is covered by over 20 individual cables, other countries are not as lucky. Bulgaria, for example, is party to only one known undersea fiber connection.
What is unknown is the extent of land-based connections- and for good reason. These connections are more easily disrupted and, in turn, could be targeted in a geopolitical conflict where a combatant could disrupt the internet as a means to limit communication within a given country.
As such, it is important to know how a country connects to the Internet. Knowing this will help a firm assess the likelihood of a geopolitical conflict disrupting the Internet and determine what (if any) contingencies are necessary.
No less important is the economic risk of Internet disruption. Global businesses rely on fast connections to conduct day-to-day operations. Without an Internet connection, emails from Helsinki to Warsaw don’t go through, contracts remain unsigned, and potential clients move on to a competitor.
Moreover, there is some evidence that slow Internet speeds affect the overall income of a country. A study commissioned by Swedish technology firm Ericsson found that an increasing Internet speed increases personal income in both OECD and BIC countries . Thus, knowing the source and speed of Internet connections can help a firm decide which country would be best suited for its production needs.
Communications play a key role in any global operation, and knowing the level of connectivity- and the likelihood of a disruption- is important for making global decisions