Am. Samoa Telecom Seeks Loan For Fiber Optic Cable

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Pacific Islands Development Program, East-West Center With Support From Center for Pacific Islands Studies, University of Hawai‘i

Authority approaches Retirement Fund for $4 million

By Fili Sagapolutele

PAGO PAGO, American Samoa (The Samoa News, Feb. 9, 2016) – The American Samoa TeleCommunication Authority board of directors has submitted a letter of application seeking a loan of just over $4 million from the ASG Employees Retirement Fund for the first two payments to a the undersea fiber optic cable called Hawaiki cable.

The loan and the amount were confirmed by board chairman Roy J.D. Hall Jr., during a Senate Government Operations Committee hearing yesterday. The hearing was the result of a request early last week from Sen. Laolagi F.S. Vaeao to find out about reports that ASTCA was seeking a loan of over $4 million from the Retirement Fund.

During the hearing, Hall explained that it was about three or four weeks ago that the board submitted a letter to the Retirement Fund board for a loan of $4.75 million for a new project. Hall first pointed out that he is sure many people know that the American Samoa Government invested $9 million in the American Samoa Hawai’i Cable LLC. (ASH Cable), the undersea fiber optical cable connecting American Samoa to Hawai’i and American Samoa to Samoa.

"And we haven’t received as far as I know any dividends in actual cash to assist the government," he said, adding that ASTCA is a wholesale customer of the ASH Cable. Additionally it receives no discount on what it pays, which is about $155,000 a month to the ASH Cable.

While Bluesky Communications is another customer, Hall says he doesn’t know how much Bluesky pays to ASH Cable and the life of the ASH Cable is between two to five years right now and "we need to find a new undersea fiber cable."

"We were... approached by a company called Hawaiki cable and the loan application to the Retirement fund is to fund the first two payments under that project," he said. "It is not to go pay any old debts or any other projects but specifically targets to allow us to be part of a new undersea submarine cable."

Responding to committee questions, Hall said he talked to the governor and told him that ASTCA was applying for a loan, which was authorized by the ASTCA board.

Asked about the O3b satellite, Hall said the satellite is "working very well and we are receiving very good responses on that." However, he said the only problem is that when there is heavy rain, it does disrupt the signal "and that is why it’s very important for us to obtain an undersea submarine cable to be our primary cable and the O3b will be our redundant, or secondary service."

(When the O3b was launched early last year, ASTCA announced that the O3b would be its secondary service.)

Hall added that for the ASH Cable "we now pay, $100,100 per megabits."

"Under the O3bs it’s $400 to $600 per megabits, which is a lot cheaper, so we are now using O3b as our primary form of internet service," he said.

(A megabit is a million binary pulses, or 1,000,000 (that is, 106) pulses (or "bits"). It's commonly used for measuring the amount of data that is transferred in a second between two telecommunication points)

Samoa News understands that the Retirement Fund has not acted on ASTCA’s request.

BACKGROUND

ASH Cable is majority owned by the Bluesky group and its parent company and minority owned by the American Samoa Government, but the governor’s executive assistant Iulogologo Joseph Pereira told Samoa News in December that the governor has made known to the ASH-Cable leadership the government wants to liquidate its shares of the ASH-Cable venture.

Bluesky Pacific Group, which has operations in American Samoa, Samoa, Cook Islands and New Zealand, announced last December a new fiber optic cable system called Moana Cable, which will "enhance Pacific connectivity and ensure redundancy across the region." The cable system will span more than 9,700km (over 6,000 miles) across the Pacific and to be completed in 2018. Gov. Lolo Matalasi Moliga had been presented with the Moana Cable proposal.

In its final report released in January 2015 with copies to lawmakers, the Economic Development Implementation Plan (EDIP) task force emphasized the need for American Samoa to seek out another undersea fiber optic cables because the current one has less than ten years left in its life span.

The report also raises concerns about the "aging and high cost" of ASH Cable and suggests that ASTCA secure a letter of intent with "Hawaiki" cable company for a spur to American Samoa, off the Hawaiki main cable, running from Portland, Oregon to Australia.

In the meantime, internet service in American Samoa remains inadequate and unreliable.

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