News in English

Big Tech’s Undersea Cable Empire is Building Tomorrow’s Digital Economy

Innovation can’t exist without foundational infrastructure networks to support it.

Last week, PYMNTS reported that the Global AI Infrastructure Investment Partnership, which is spearheaded by MicrosoftBlackRock and others, is planning to spend up to $100 billion on artificial intelligence (AI) data centers, ensuring that the plumbing is in place for the connected economy’s future.

After all, the digital infrastructure being built right now isn’t just for the tech elite — it’s the foundation for how the world will do business.

But data centers alone won’t enable the future of global connectivity. Internet access requires the internet, which is traditionally delivered around the world via undersea cables. Today, a network of these active undersea cables spans the oceans in a literal internet services value chain, connecting continents and facilitating the high-speed transfer of data essential for everything from video streaming to cloud computing to financial transactions.

Traditionally, telecom companies and consortiums of government-backed entities have built and maintained undersea cables. But this has shifted as Google, Meta, Microsoft and Amazon expand their role in infrastructure. Google is a part or sole owner of around 33 subsea cables, Meta owns more than a dozen, Microsoft counts five and Amazon four. In the past 10 years alone, the amount of international cable capacity used by just that same quartet of tech giants has surged from 10% to 71%, according to a report by the Australian Strategic Policy Institute.

As businesses and consumers demand faster, more reliable connections to conduct transactions, Big Tech’s investments in these undersea cables are becoming essential for everything from online banking to cross-border trade. These cables are about more than just data transfer and cloud capacity. They’re the unseen threads stitching together the fabric of a connected economy.

Read more: How 10 Payments Executives ‘Do’ Digital in the Post-Pandemic Age

Securing the Backbone of the Connected Economy

The global economy relies on digital infrastructure to support commerce and payments. As consumer habits shift toward digital transactions and as businesses expand into international markets, the importance of robust, secure data infrastructure becomes paramount. Global payments, for example, are facilitated by real-time data transfers that cross national borders instantaneously, supported by undersea cables.

More than $150 trillion in cross-border payments are made every year, and the volume is expected to grow as digital commerce continues to expand. Payment networks require low latency to ensure that these transfers happen quickly and securely, especially as transactions are increasingly verified through real-time risk assessments powered by AI and other data-intensive tools.

The quicker and more reliably data can be transferred, the smoother and more secure the world of commerce becomes. For example, as more businesses migrate their operations to the cloud, they can benefit immensely from fast, uninterrupted data connections across the globe.

And as the world moves toward more digital and real-time payment solutions, the underlying infrastructure becomes even more critical. Technologies like blockchain, central bank digital currencies (CBDCs) and instant payment platforms depend on low-latency, high-capacity networks. These innovations have the potential to transform cross-border commerce by reducing friction, lowering fees and speeding up settlement times.

Read more: Meta Says It’s Solving AR Experiences — Who Will Solve AR Payments?

The Future of Digital Payments and Cross-Border Commerce

Yet, all of these improvements rely on a physical layer of infrastructure — particularly undersea cables — that can support the demands of these payment systems.

At the same time, as global trade and eCommerce expand, particularly in regions like Southeast Asia, Africa and Latin America, the need for fast, secure connectivity grows exponentially. Big Tech’s investment in undersea cables in these regions opens up new avenues for expanding digital economies, enabling even remote regions to participate in global commerce seamlessly.

Data from PYMNTS Intelligence finds that consumers in the U.S. alone engage in an average of 14 different digital activities each month: paying bills online, conducting telehealth visits, streaming music and videos, and shopping and paying for groceries and retail products using digital payments and apps.

PYMNTS’ Karen Webster covered last month (Sept. 3) how, as digital becomes the DNA of business, success won’t be measured by the products a business makes or sells, but how well they create and monetize ecosystems that connect activities across traditional industry sectors.

“As I have written many times, payments is the cornerstone for this digital transformation,” she wrote.

For all PYMNTS digital transformation coverage, subscribe to the daily Digital Transformation Newsletter

The post Big Tech’s Undersea Cable Empire is Building Tomorrow’s Digital Economy appeared first on PYMNTS.com.

Читайте на 123ru.net