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Another Southern Cross Price Drop

Another Southern Cross Price Drop

Southern Cross prices have again fallen and the company continues to expand its international capacity as it continues to upgrade the network.

“We have reduced our capacity prices by another 20%”, said Sales and Marketing Director Ross Pfeffer. “This will be our 10th major price reduction since 2000 and over the period our price decline has averaged more than 22% per year.

“It’s been pleasing to see big increases in data caps and declines in retail data cost for internet users in both Australia and New Zealand over the last year. Our continued initiatives to increase supply and reduce price are designed to encourage this process and to support the needs of Australia's NBN and New Zealand's UFB” Pfeffer noted. The Southern Cross Network provides uninterrupted hi-speed connectivity to US based internet content. Constructed as a protected twin cable network of 28,500 kilometres of undersea cable the Southern Cross cable network has become a major regional asset for reliable high-speed broadband.

The latest price decline marks the second stage of the eighth major capacity expansion programme since 2001 and it is due for completion in February. This Stage is based on Ciena’s 40Gbps transmission equipment and takes total lit capacity on the Southern Cross Network to 2 Tbps.

The third stage of the current expansion programme is being implemented concurrently and it is based on Ciena's 100 Gbps transmission equipment. 100G technology is already installed on some network segments and will take lit capacity to 2.6 Tbps by June 2013. Ross Pfeffer commented that, “the increasing simplicity of equipment upgrades provides Southern Cross with the ability to frequently and rapidly expand capacity. We currently have the potential to go to at least 7 Terabits per second, about 30 times higher than our original design capability.”

“Our capacity potential will increase dramatically over the next few years when transmission equipment speeds are expected to quadruple. With ongoing and dramatic advances in technology Southern Cross has the ability to stay well ahead of demand over the longer term”.

While continuing to reduce cost and to expand supply, Southern Cross remains dedicated to continuous circuit availability. “Our protected circuits continue to provide 100% availability and the performance of the six fibre pairs and 500 repeaters on the diverse cable network is better today than when constructed more than 10 years ago” he noted.

Further Information

Private company owned by Telecom NZ, Singtel-Optus and Verizon Business

Offices in Bermuda, Wellington, Sydney and Auckland

Dual Cable network constructed between 1998 and 2000.

28,500 Kilometers of submarine cable with 3 fibre pairs

Construction and upgrade cost exceeds 1.4B USD

Ring Network Architecture based on completely diverse submarine cables and landing stations

12 Access points: (2 in NZ, 3 in AU, 1 in Fiji, 2 in Hawaii, and 1 in Oregon, 1 in Washington state and 2 in California)

Major suppliers: o Cables and Repeaters

Alcatel and Fujitsu; o Transmission Equipment:

Alcatel and Xtera (10Gbps)

Ciena (40Gbps and 100Gbps)

Consistently ranked the most preferred submarine cable system in the Asia Pacific Region (according to customers participating in an annual satisfaction survey conducted by Neilson).

Eight capacity expansion programmes since 2000, from 80 Gbps to 2 Tbps in January 2013 and 2.6 Tbps by June 2013


Social media: o

o Twitter: SXCables

Ten price reductions since 2001. Price has fallen at an annual average of 21% over the total period.

95% of active ANZ <–> US Capacity is operated by our customers in a fully protected configuration

Southern Cross Market Principles:

1. Take advantage of technological improvements to expand capacity well ahead of demand and to lower the cost of supply.

2. Offer prices to support hi-speed broadband that are based on both competitive market forces and the reducing cost of supply.

3. Apply competition based prices to all market segments (e.g. we have kept our prices for the NZ-US market no higher than our prices for the AU-US Market where there are four competing cable suppliers)

4. Enhance the automated protection of the dual cable network to ensure continuity of protected circuits.

5. Promote products that use the inbuilt protection of the Network.

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