An undersea internet cable is the latest snag in US-China tensions over Hong Kong

Image: Reuters/Thomas Whie
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The job of powering the global internet rests on a complex network of more than 400 submarine cables that ferry reams of data around the world at high speed, 24/7. Most of us will likely never see one of these cables, but where they are laid, and where their land-based stations are located, can have huge geopolitical ramifications.

The Pacific Light Cable Network is a case in point. Announced in 2016 as a partnership between Google, Facebook, and other companies, the planned 12,800-kilometer (8,000 miles) cable would be the first direct US-Hong Kong submarine connection with the aspiration to become the “highest-capacity trans-Pacific route.” The cable was meant to see Hong Kong serve as a global data hub, helping Google and Facebook meet explosive demand for their bandwidth-intensive services. But years of delays later, the cable is still not fully operational.

On Wednesday (June 17), the project was dealt another blow when Team Telecom—a committee under the US justice department—urged the Federal Communications Commission to block approval for the Hong Kong connection, citing “national security” concerns and threats to US persons’ data, and instead use the cable’s Taiwan and Philippines spurs.

The fiber-optic cable’s proposed Hong Kong landing station “would expose US communications traffic to collection” by Beijing, the committee said in its statement, adding that these concerns have been heightened by China’s “recent actions to remove Hong Kong’s autonomy.” And in its 78-page filing, Team Telecom explicitly pointed to Beijing’s plans to quickly impose a sweeping national security law on Hong Kong, potentially allowing mainland law enforcement to operate there, as a cause for concern. The recommendation comes after US president Donald Trump last month ordered his administration to begin stripping Hong Kong of its special status, which gives the territory unique privileges in its relations with other governments.

News of Team Telecom’s recommendation was met with dismay in Hong Kong.

“This is bad for Hong Kong,” said Charles Mok, a lawmaker representing the city’s IT sector. That the US explicitly stated its concerns that Hong Kong could be unsafe as a global data hub “may signal a very significant change in attitude toward Hong Kong’s infrastructure and service hub role,” he said.

Hong Kong’s robust legal system and well-protected rights long made it a preferred place for businesses to raise funds and sign deals. Viewed as distinct from the mainland, it could enter trade agreements separate from China, receive exports of sensitive technologies from the US that are blocked in China, and be exempted from US tariffs on Beijing. The telecom committee’s recommendation is the first concrete sign of the ramifications of the US rescinding the city’s special status: More governments and investors are likely to treat the territory as if it’s just another mainland Chinese city.

Team Telecom expressed concern that Pacific Light Data Connection, which controls four of the six fiber pairs in the cable and would manage the Hong Kong landing station, is owned by Chinese telecom firm Dr. Peng Group, the fourth-largest Internet provider in China. In a 2017 statement (link in Chinese) announcing its acquisition of Pacific Light, Dr. Peng Group said the trans-Pacific cable was in line with China’s Belt-and-Road plan, a strategy to build global influence through infrastructure. The telecom committee also cited a report (pdf) from a Chinese government think-tank that said Beijing should “optimize the laying of submarine cable landing stations in China” as part of its campaign to extend its technological sphere of influence under the Belt-and-Road Initiative, and to strategically “play the advantage of Hong Kong” as a way to leverage further cable connections.

In terms of security, cable landing stations may well be more important than the cables themselves, said media and governance professor Motohiro Tsuchiya, speaking at a March panel organized by the Carnegie Endowment on the geopolitics of submarine cables.  “Inside the cable landing station you can have data, you can collect data, you can monitor cable,” he said, noting the landing stations’ growing importance for intelligence and law enforcement agencies.

The Hong Kong government’s commerce department said yesterday that it was “disappointed” by Team Telecom’s recommendation, and that its concerns were “ungrounded.” It reiterated the government line that the national security law, far from undermining the city’s trusted institutions, would instead bring a “stable business environment” for foreign investors.

A Facebook spokesperson said the company was “reviewing” Team Telecom’s recommendation. A Google spokesperson said the company will “continue to abide by the decisions made by designated agencies in the locations where we operate.” Pacific Light Data Connection, the Hong Kong-based company with majority ownership of the cable, has not responded to a request for comment.

Some industry experts think US concerns about the Hong Kong landing point are at odds with the fact that there are already existing cables directly connecting the US and China, and that blocking a certain cable landing will just re-route traffic via a third country. The more pressing issue, said Alan Mauldin, research director at TeleGeography, is that the Pacific Light cable has been “a very bad investment for the companies involved” because of the hundreds of millions of dollars invested in the much-delayed project.

A US ban on the Hong Kong connection point could also spell trouble for the city’s own development of future telecommunications infrastructure, Mok added. “If they ban this cable, they can ban more new ones that are on the horizon or even being planned,” he said. “That means while we are well connected now, we will not get new, large bandwidth supply. It won’t hit us much now, but if this continues, it will limit our capacity growth in the years to come.”

There are currently two other US-Hong Kong cables under application: the Hong Kong-Americas cable, involving Facebook and Chinese state-owned China Unicom and China Telecom; and the Bay to Bay Express, involving Facebook, Amazon, and state-owned China Mobile. Those cables’ Hong Kong landing points may well be blocked, too, if the FCC shares Team Telecom’s concerns over the Pacific Light Cable.