Facebook Inc. and Microsoft Corp. have teamed up to build a new fiber optic cable under the Atlantic Ocean, the latest evidence that the biggest U.S. tech companies are seeking more control over the Internet's plumbing.

The new project, called Marea, will span the more than 4,000 miles between Virginia and Spain with eight pairs of fiber optic strands, which would make it the highest capacity link across the Atlantic. The Web companies joined with Spanish Internet carrier Telefó nica SA to build the cable, which is expected to enter service next year.

The cable, named for the Spanish word for tide, is the latest in a string of big-budget Internet infrastructure projects Web companies have pursued to gain more control over their data. Microsoft and Facebook have previously invested in other trans-ocean cables, as has Alphabet Inc., which owns Google, and Amazon.com Inc.

In a joint statement Thursday, the companies said the new cable will help to lower costs, accelerate bandwidth rates and help accommodate the explosion of data use around the world, both for commercial use such as cloud-computing and personal use like sharing photos on social media.

Microsoft also wanted to build redundancy in its network and invest in an area where cables don't run, said Christian Belady, its general manager for data center strategy. Many of the trans-Atlantic cables originate in the New York area and run to Northern Europe.

"We were looking for other places" away from New York, Mr. Belady said. "You want to make sure you have multiple paths. You can't survive on one cable, or frankly two."

The wholesale price of shuttling data across continents has been plunging for the past 15 years, leaving traditional telecom companies scrambling for a way to make a profit. But that fall hasn't been steep enough for the biggest U.S. tech companies that need to send data for billions of accounts through dozens of data centers around the world. Because the investment costs are high, only the very largest Internet companies have made the plunge.

The shift has made the biggest Web companies the driving force behind some of the telecom industry's most expensive subsea cable projects, according to Alan Mauldin, research director for the market analysis firm TeleGeography.

"These companies, they don't really need anybody else to get a cable funded," Mr. Mauldin said. "They have a large say in determining, for the Atlantic for sure, what gets built and where."

The companies declined to provide a cost estimate for the cable. New trans-Atlantic cables usually require more than $200 million to build, Mr. Mauldin said, though expenses vary widely depending on the project. The companies must also seek regulators' approval for lines that domestic security agencies consider part of their countries' critical infrastructure.

The biggest Web companies mostly have focused their investments on heavily trafficked Internet corridors that tie together cities in Europe, the Americas and East Asia, where they own data centers. Projects like Google Fiber and Facebook's wireless broadband programs, aimed at making the Internet more accessible to consumers, are separately managed.

Google was an early mover when it teamed up with partners to build a 6,200-mile line across the Pacific Ocean, a project completed in 2010. It is in the process of finishing another trans-Pacific cable and an Atlantic line from the U.S. to Brazil.

Marea is Microsoft's third public investment in a trans-Atlantic cable. It has led the U.S. investment in the New Cross Pacific Cable to China. Amazon.com Inc. recently joined the club with an investment in the Hawaiki cable from Oregon and Hawaii to Australia and New Zealand.

Telefó nica's new infrastructure company, Telxius, will manage the high-speed link once it is finished, though its design still gives Facebook and Microsoft control over their data. The setup allows each company to pass information over their own dedicated fiber optic lines and to upgrade the equipment at each end when new hardware becomes available.

Deepa Seetharaman and Jay Greene contributed to this article.

Write to Drew FitzGerald at andrew.fitzgerald@wsj.com

 

(END) Dow Jones Newswires

May 26, 2016 18:05 ET (22:05 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.
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