The next front in the U.S.-China tech battle could be underwater cables that power the global internet.

• The increasing tensions between the U.S. and China are putting pressure on underwater cable networks, which are now a new point of contention in international relations.
• The global internet relies heavily on subsea cables, which transmit 99% of the world's data traffic.
• According to reports, the U.S. government cautioned tech companies such as Google and Meta about the potential for Chinese surveillance on undersea cables in the Pacific.

U.S.-Chinese tensions surrounding technology have have sunk to sea lows.

Earlier this year, four out of 15 critical submarine cables in the Red Sea were cut during attacks by Yemen's Iran-backed Houthi rebels on Israeli, U.S., and U.K. ships, resulting in subsea cables hitting the headlines.

The growing public awareness of submarine cables has resulted in these networks becoming a new source of tension in international relations, as geopolitical tensions escalate between the U.S. and China.

What are subsea cables?

According to TeleGeometry, a telecom market research firm, hundreds of massive telecommunications cables are buried deep underwater and span a length of nearly 1.4 million kilometers.

Some of these cables are shorter, such as the 131-kilometer CeltexConnect cable linking Ireland to the U.K., while others run for far longer distances, like the 20,000-kilometer Asia America Gateway cable.

The demand for data traffic is increasing due to the growth of video streaming and cloud services, which is expected to result in an increase in the number of subsea cables around the planet in the coming years.

According to TeleGeometry, as of early 2024, there were 574 active and planned submarine cables being tracked.

Why are they important?

The global internet relies heavily on subsea cables, which transmit 99% of intercontinental data traffic.

Akamai Labs' chief technology officer, Andy Champagne, stated in an email to CNBC that if you have communicated with someone on another continent through email, text, or video chat, you have utilized a subsea cable without giving it much thought.

"As we connect through a complex network of fiber optic cables on land, the challenge intensifies when we venture into the ocean," Champagne stated.

"Installing subsea cables is a complex task, and fixing any problems with them is a challenging job."

The significance of subsea cables lies in the consequences of disruptions, as stated by Joe Vaccaro, vice president and general manager of Cisco-owned internet monitoring firm ThousandEyes.

Vaccaro stated in an interview with CNBC that instead of saying "undersea cable cut," individuals like him and I experience slow or unavailable applications.

"As Vaccaro explained, when traffic is rerouted due to cuts, congestion occurs."

A growing security risk

Historically, subsea cables were owned and operated by telecom carriers. However, in recent years, U.S. tech giants such as Meta, Google, Microsoft, and Amazon have invested heavily to lay down their own cables.

In 2021, Meta and Google unveiled plans to lay two massive subsea cables linking the U.S. West Coast to Singapore and Indonesia. The Echo and Bifrost trans-Pacific cables are expected to boost data capacity between the regions by 70% and enhance internet dependability.

Meta is investing in both cables, while Google is only backing Echo. Meta has previously announced plans to build a 37,000-kilometer long undersea cable around Africa to improve internet access, while Google is also working on a subsea cable called Equiano that aims to connect Africa with Europe.

According to unnamed sources in the State Department, the Wall Street Journal reported in May that U.S. officials privately warned tech firms including Google and Facebook that undersea cables in the Pacific region could be vulnerable to spying by Chinese repair ships.

According to the WSJ, it seemed that Submarine Systems, a Chinese state-owned company responsible for repairing international cables, was concealing the whereabouts of its vessels from radio and satellite tracking systems.

When contacted by CNBC, Submarine Systems, Google, Meta, and the State Department were not immediately reachable for comment.

Estonia accused China of not responding to a six-month-old request for assistance in investigating a Chinese ship that cut two of its subsea cables. China's foreign ministry responded by stating its readiness to cooperate with Estonia on the investigation.

The growing concern over underwater cables as a potential source of national security threats is underscored by the fact that these networks transmit sensitive information, such as diplomatic communications, security operations, and intelligence gathering.

The U.S. government's concerns aren't new and have been widely documented.

An interagency committee known as Team Telecom is reportedly working to prevent any direct subsea cable connection between U.S. territory and mainland China or Hong Kong, citing concerns over Chinese espionage, according to a Reuters report from March 2023.

Numerous international subsea cable projects are reportedly avoiding China today due to worries about data security and Beijing's growing geopolitical power. China has spent hundreds of millions of dollars to develop its own underwater cable infrastructure to compete with the U.S.

Central points of vulnerability

The problem with the current setup of subsea cables is that they connect entire regions of the world, impacting a significant portion of internet infrastructure.

A single cable cut in a specific location could have significant consequences for all major cloud providers if it's crucial for your business to provide connectivity between those two points in the world, as ThousandEye's Vaccaro stated to CNBC.

When critical connections are disrupted, a "blame game" can occur, with consumers often blaming the services they're using for outages or traffic congestion.

It can be beneficial for firms to use a different cloud provider in certain regions to maintain consistent network quality from a "performance and visibility" perspective.

Subsea cables have specific requirements for where they can transition from subsea to land, and there are only a limited number of geographic spots that meet these requirements, according to Akamai's Champagne.

"The loss of a subsea cable can have a domino effect on land-based networks, resulting in a greater impact than the loss of a land-based cable."