Added by Nigel Shelbourne on September 13, 2011
A new transatlantic fiber-optic communications cable is expected to give financial traders a 6 millisecond edge over their competitors, possibly adding more than US$100m to the valuation of a large hedge fund.
The cable, called Hibernia Express, is expected to cost US$300m and is planned to be about 6,000km (3,700mi) long. The cable will connect financial traders in New York with traders in London.
In a statement, Bjarni Thorvardarson, CEO of Hibernia Atlantic said, “Demand for low latency routes has grown exponentially over the past several years. Project Express will offer the lowest latency from New York to London and provide demanding customers the speed and accuracy they require.”
Traders currently rely in a cable that was laid in the 1990s, during the dot-com bubble, and makes the transatlantic connection in 65 milliseconds. The new cable’s transit time is expected to be under 60 milliseconds.
The Hibernia Express plans to sell bandwidth that is expected to be about 8% faster than currently available bandwidth at a premium of up to 50 times current rates.
While the speed at which data travels through a fiber-optic cable is constant, Hibernia Atlantic says the new cable’s route is 498km (310mi) shorter than the current cable traders use, resulting in the faster transit time. The new cable’s route took 18 months of planning and mimics the route that aircraft follow when travelling between New York and London, making it the shortest possible path.
A British firm, Global Marine Systems, is currently laying the cable, which is expected to provide fast bandwidth to traders by 2013.