$1.5 Billion: the Cost of Cutting London-Tokyo Latency By 60ms 158
MrSeb writes "Starting this summer, and thanks to the continuing withdrawal of Arctic sea ice, a convoy of ice breakers and specially-adapted polar ice-rated cable laying ships will begin to lay the first ever trans-Arctic Ocean submarine fiber optic cables. Two of these cables, called Artic Fibre and Arctic Link, will cross the Northwest Passage, which runs through the Canadian Arctic Archipelago. A third cable, the Russian Optical Trans-Arctic Submarine Cable System (ROTACS), will skirt the north coast of Scandinavia and Russia. All three cables will connect the United Kingdom to Japan, with a smattering of branches that will provide high-speed internet access to a handful of Arctic Circle communities. The completed cables are estimated to cost between $600 million and $1.5 billion each. As it stands, it takes roughly 230 milliseconds for a packet to go from London to Tokyo; the new cables will reduce this by 30% to 170ms. The latency drop will mainly benefit algorithmic stock market traders, but other areas like education, telemedicine, and POTS will also enjoy the speed-up. Perhaps more importantly, almost every cable that lands in Asia goes through a choke point in the Middle East or the Luzon Strait between the Philippine and South China seas. If a ship were to drag an anchor across the wrong patch of seabed, billions of people could wake up to find themselves either completely disconnected from the internet or surfing with dial-up-like speeds. The three new cables will all come down from the north of Japan, through the relatively-empty Bering Sea. In addition, the Arctic Ocean, where each of the cables will run for more than 5,000 miles, is one of the least-trafficked parts of the world. That said, the cables will still have to be laid hundreds of meters below the surface to avoid the tails of roving icebergs."
Bering Sea? (Score:5, Funny)
Next, on Discovery's Deadliest Cabling Job...
Expanding bandwidth, ignoring latencies. (Score:4, Interesting)
Why not just leave the latencies alone? It's not like one gets cumulative latencies - the 230ms is constant in time.
I guess the Bering Sea will be the crosspoint b/w the Siberia-Alaska railline that the Russkies want to build, and this cable that runs from the Arctic to the South. Probably run it along the Kamchatka peninsula coastline, then across to Sakhalin, Japan, then on to Taiwan, Philippines and along the S China Sea to Singapore on one end, and on the other, from Philippines, run it along to Papua New Guinea and then Australia and New Zealand. From Singapore, they could run a line to India, and get enhanced bandwith in that country.
Re: (Score:3)
Re: (Score:3)
As if the UK is going to be any better? If it is a race to fascist totalitarianism than the UK is currently leading with the US and Australia trailing behind....
Re: (Score:2)
Re: (Score:2)
The NSA does not own canada yet.
At least the republicans in Congress have not voted on annexing Canada, I think they are arguing over earmarks right now.
Re: (Score:2)
Re: (Score:2)
Posting to remove misclicked mod, oops.
Re: (Score:2)
Re: (Score:2)
Actually, you do. Consider HTTP:
Total effective latency for the images is 3x. Latency is very much cumulative when one request depends on another. It is only non-cumulative when you are solely using the lin
Quake Servers (Score:2, Funny)
Oh awesome, now I can play on japanese quake servers!
Also good for gamers (Score:1)
Re: (Score:2)
Re:Also good for gamers (Score:5, Funny)
Re: (Score:2)
Oh you kids and your new-fangled postal service! When I was a kid we would carve our next game move onto a rock and wait for the glacier to deliver it. And we liked it that way.
Now where did my fiber go....
Re: (Score:3, Funny)
We had to wait for continental drift.
Re: (Score:2)
FPS via postal mail is possible.
Get a copy of Steve Jacksons "FRAG" and Play by mail. in fact I bet you can find someone that does.
Re: (Score:2)
Millisecond trading (Score:5, Interesting)
Investing in shares for time spans of months is of general benefit to the economy, directing investment dollars to those best able to use them. Millisecond trading is of no benefit to anyone except millisecond traders, and any money they make is at the expense of people trying to do something productive. I propose that stock markets shift to a 'clock pulse' trading model: Trade bids for (e.g.) Apple are accumulated for (e.g.) 5 seconds and then all sales are resolved without regard for the order in which the bids arrived. This will cause no problems to real investors, but will rid us of the millisecond leaches.
However, I am not experienced with the share market, so constructive criticism is welcome.
Re: (Score:2)
Re: (Score:2)
Outside of the occasional "flash crash", which by the way have been mostly handled by the SEC reversing sales and pushing the reset button pretty effectively, I see HFT as mostly harmless. It might not add any value to the enterprises being traded but it makes the market better for investors not worse over all. The more orders out there at any time means the better shot an actual investor has at having their order filled when the want it.
Liquidity in the market is a good thing. I don't have to wonder if
Re: (Score:2, Interesting)
Cross-exchange arbitrage strategies are typically performed by servers located as close the the midpoint of the cabling between them as possible. Perhaps it's time to speculate on Alaskan rack space.
Parasitic trading (Score:5, Interesting)
Parasitic trading is tolerated not desired. It diverts profit from investors into traders, reducing the number of investors in a market by reducing the profits they can make and thus reducing the capital available to companies. Fewer companies go to the stock market to obtain capital as a result.
So yeh, you basically understood it correctly, however it has little to do with 'share' trading, rather derivatives.
The derivatives market far outweighs the shares market these days. These are pure bets stuff like: "derivative X pays out k(Z-W) for each cent asset Z rises above (K+U+Y)/3.... ladies and gentlemen place your bets I will spin the wheel". It's a bookies pure bet.
Unlike a proper bookies, Wallstreet pays out more money that it receives, so banks around the world place bets on these derivatives in order to make money. The banks and Wallstreet can afford to buy cables, it's pocket change since the underlying asset may only be a shopping mall worth $50 million, but the derivatives derived from that can be worth billions since it's a virtual asset with no real value beyond the fact it pays out a profit.
In a good year (when they take more money than they pay out) Wallstreet awards themselves big fat bonus's, in a bad year, the Fed extends them more credit against smaller assets. So overall, because they pay out more than they take in, their borrowing leverage increases. Today it's something like 30:1 or more.
The Fed says 'the loans were good we got all the money back', but that's a lie. They print money against 'Linden dollars', Wallstreet buys assets that pay out enough to cover the interest with that cash, Wallstreet borrows against those new assets, and pays back the money borrowed against the 'Linden dollars'. The Fed says 'hey look we got all our 'Linden loans' back', Wallstreet gets to own a real asset, everyone holding dollars has been silently robbed by inflation.
But hey - faster internet! /rant
Re: (Score:3)
Once a company IPOs, that's pretty much all the capital they get. And the bank handling the IPO pays the company to do so at a fixed price. Now, a company may choose to only sell say, 10% of itself, holding onto 90%
Re: (Score:2)
You don't need HFT to have market markers.
If you think a stock is undervalued you buy some of it. If you think it is overvalued you sell some of it.
In your example there are people selling at $6, and buying at $4. If I think the intrinsic value is $5 then I can put out buys at 4.50 and sells at 5.50 and be the first person anybody goes to to make a trade, and make a profit on every one (assuming the real value really is $5).
Re: (Score:3)
Sigh, you have a very incorrect understanding of derivatives. First off,
These are pure bets stuff like: "derivative X pays out k(Z-W) for each cent asset Z rises above (K+U+Y)/3
No derivative works that way. Derivatives are, for the most part, options that allow you to make a trade in the future at a predetermined price today. For example, I can buy a put option which gives me the option of selling some shares 6 months from now at a preset price. Of course, it's not just shares. Futures are most heavily traded on commodities (wheat, oil) and currency (the US dollar, the euro, the yen).
You're right that they can
Re: (Score:2)
Maybe I don't follow this completely, but I take issue with this. Wall street is basically revenue neutral. For every winner there is a loser, and for every dollar in, that money has to come from somewhere because no wealth is created.
You can argue that value is created, because you can buy something which you value but which somebody else doesn't
Re: (Score:2)
With the sole exception of IPO's the only difference between holding a stock for a millisecond or for months is how long you hold the stock. In both cases you pay the guy you bought the stock from, and get
Re: (Score:2)
Also, 'holding' a stock for a millisecond, because you gamed the system using servers, locations, and algorithms not available to the market as whole, is done for one reason.
To see the orders the 'real' investors make, buy a millisecond before they can, and then sell it to the original actual investors for a fraction of a cent more than they would have bought it anyway from a true market.
It does not help with pricing, it does not benefit the market itself.
It is no different than theft. If you make a huge mental stretch you could maybe compare it to ticket scalping.... Something also almost universally illegal.
Except that scalpers actually do help set a more correct price based on the market. Seeing a game or concert is worth more to some people than to others. Scalpers make sure they people who are willing to pay the most to see the game or concert are the people who actually get to see it. (The morality of the fact that "willing to pay the most" sometimes means "has the most money" rather than "wants to see it the most" is a separate question.)
I think the scalpers help society far more than the millisecond
Re: (Score:2)
Many would argue that investing for periods of less than a [report cycle] is simply going to encourage [Management] to play to the short-term crowd.
My employers have managed about 8% year-on-year growth for the 20 years that I've been an employee. But if we'd been a publicly-traded company, we'd probably have been shut down and lost the personnel asset several times in that period. 1.08^^20 = 4.7 ; good enough?
No, probably n
Re: (Score:2)
IPOs and share issues help the economy, but nobody would buy these shares if there wasn't a way to recover the investment (hopefully with a profit) later. The only shares I own were purchased directly from the issuing company. (Which reminds me - it is over a year since I looked at their value. Crud - they're both doing horribly.)
The share market also provides a mechanism for takeovers and mergers.
Re: (Score:3)
When you buy a share the only person who benefits is the person who sold it to you. It helps the company not at all.
While I generally agree that the stock market is mostly legalised gambling with trillions of dollars, the last company I worked for was only able to buy up a couple of its ailing competitors by a mix of cash and share swaps; had the price been significantly lower that would not have been possible because it would have required far too much cash.
Re: (Score:2)
Is it not also possible that the person buying the share benefits as well? If a trade wasn't mutually beneficial (at least from the respective points of view of the people involved) then it wouldn't happen.
Think of the alternative: a person invests in a company, but can't ever get their capital back unless the company buys them out. So either capital investment becomes slower and riskier
Yay self-destruction (Score:5, Insightful)
"The latency drop will mainly benefit algorithmic stock market traders"
In other words, these cables will help machines ruin the global economy.
A part of me is kind-of glad they're speeding this up. We all know the system is destined to break, so the sooner that happens, the sooner people will wake the fuck up and demand change.
Re: (Score:1)
Stock market doesn't mean shit about the economy. It's not a "good economy" when stocks go up--it's just inflation.
Re: (Score:2)
using hundreds of millions dollars worth of work time for it means shit for economy though..
and probably the op was referring to stocks getting prices not based on their worth, but by algorithms which trade with other algorithms which trade based on what other people trade and not based on what the actual company worth is or is going to be.
who gives a shit though? also automatic traders will have serves in japan if they're trading in japan so this(new cabling) isn't really going to matter at all to them. th
Re: (Score:3)
also automatic traders will have serves in japan if they're trading in japan so this(new cabling) isn't really going to matter at all to them
The traders it matters to are those engaging in arbitrage.
Many things (stocks, commodities, derivitives whatever) are traded on more than one market. Each market develops a price for the thing. Prices in the different markets are held reasonablly close by people engaging in arbitrage (buying in one market and selling in another). The lower you latency you have to BOTH markets the lower the risk that prices will shift to an unfavorable position while you are in the middle of executing your arbitrage.
Re:Yay self-destruction (Score:5, Insightful)
It's funny. But idiot's like the GP don't understand that speculators like me make money up and down in the market. I don't care one way or the other, I can make money in either direction.
For every cent you make, someone else loses it. You're like the sad people in vegas that spend their lives camped on the slots, the only difference is you gamble with other peoples money.
Re:Yay self-destruction (Score:5, Insightful)
Yes, because there is a fixed amount of wealth in the world in all of history, and nobody ever increases society's wealth, correct?
Re: (Score:3)
Yes, because there is a fixed amount of wealth in the world in all of history, and nobody ever increases society's wealth, correct?
Except that we weren't talking about wealth, we were talking about currency. And excluding stabilizing inflation mechanics, yes the currency is basically fixed.
To actually increase wealth, you need to have people being able and wanting to spend money on actual wealth refinement, and people able and willing to provide said work.
And if you want to know why so much of economic theory is bullshit, you just have to look at how much of it ignores if people actually are able/willing/wanting to spend/work.
Re: (Score:2)
Yes, because there is a fixed amount of wealth in the world in all of history, and nobody ever increases society's wealth, correct?
Some people increase societies wealth but that does not come from buying and selling shares, it comes from people at the bottom actually making stuff. Of course some types of selling shares (like IPO's) does help the people at the bottom do this by facilitating investment.
The utterly parasitic stuff is crap like futures trading where you are effectively just gambling on whether a share will go up or down over a particular period. You basically agree to purchase or sell a quantity of shares at some specified
Re: (Score:2)
Associated but not correlated. Those concerned would lose money anyway it's only a question of who buys the stock (or whatever) at the new price first.
Companies and thus national societies benefit from investment but that being said there should be only real assets at stake not virtual ones resold however many times over.
With regard to the article:
1) Who gets the oil found en route?
2) "...with a smattering of branches that will provide high-speed internet access to a handful of Arctic Circle communities. "
Hundreds of meters below the surface? (Score:3)
Surface of the water or of the seabed?
I'd say you wouldn't need more than a few meters below the seabed.
On the other hand, since the depth of the ocean may vary considerably, what sense does it even make to say they're burying it hundreds of meters below the surface of the water?
That's like specifying underground land line depth in feet below the mesosphere.
Re: (Score:3)
Re: (Score:2)
I was kind of wondering the same thing-
"That said, the cables will still have to be laid hundreds of meters below the surface to avoid the tails of roving icebergs."
I thought all ocean cables were put on the seabed floor, which generally are fairly deep.
Re: (Score:3)
Re: (Score:2)
Um, what TV show told you that?
Re:Hundreds of meters below the surface? (Score:4, Informative)
Re: (Score:2)
Ah, thanks. Do undersea fibre-optic cables use repeaters? And is the power for the repeaters run down the same cable?
Re: (Score:2)
Not much ship traffic but if something does happen (Score:2)
Making repairs is a going to be major undertaking.
Looking at the map, latency could be reduced further by routing via the North Pole. Of course that makes the troubles with laying and repairing the cables even worse.
Re: (Score:2)
Neutrinos (Score:5, Interesting)
If you want to cut latency, communicate through the Earth with neutrinos [scientificamerican.com]. If we could just get the bit rate up some (from the current 0.1 bps), you could communicate to anywhere on Earth with a one way time of 40 milliseconds.
Re: (Score:2)
If the 0.1bps is faster than light, what is the practical real-time bandwidth?
Re:Neutrinos (Score:4, Insightful)
That would be from anywhere on Earth with a high intensity particle accelerator to anywhere on Earth with a huge particle detector buried hundreds of metres underground.
Re: (Score:3)
Re:Neutrinos (Score:5, Interesting)
That's true as long as it doesn't take any time to detect and decode a signal sent with neutrinos. Neutrinos are not electrons and trying to extract a signal from them is challenging enough that, in the near term, the computational latency would likely dwarf the transit time.
Re: (Score:2)
It's already been done [physicsworld.com].
.
Re: (Score:2)
Using neutrinos is positively slow compared to quantum entanglement communication. This would eliminate latency completely and allow the masters of the universe to do their trades even faster than OPERA thought their neutrinos were going..
Yeah, but it has the advantage of actually being possible.
Re: (Score:2)
Using neutrinos is positively slow compared to quantum entanglement communication. This would eliminate latency completely and allow the masters of the universe to do their trades even faster than OPERA thought their neutrinos were going..
Yeah, but it has the advantage of actually being possible.
Also I didn't know He-Man was a stock trader.
$600 million or $1.5 billion? Depends (Score:5, Funny)
The higher estimate of $1.5 billion is contingent on using Monster Cables.
Re:$600 million or $1.5 billion? Depends (Score:4, Funny)
The higher estimate of $1.5 billion is contingent on using Monster Cables.
Wall Street can afford to buy the best.
Re: (Score:2, Funny)
Re: (Score:2)
Actually I had assumed Denon...
Posting doesn't match up with the speed of light (Score:2)
Re: (Score:1)
Re:Posting doesn't match up with the speed of ligh (Score:4, Insightful)
Re: (Score:3)
You also have to account for the queueing delay at the routers, which are store-and-forward devices. That said, I really have no clue whether 230ms is a realistic number.
Re: (Score:1)
If it travels through USA, it seems reasonable:
$ ping visitfinland.ru
PING visitfinland.ru (109.70.163.2): 56 data bytes
64 bytes from 109.70.163.2: icmp_seq=0 ttl=55 time=199.910 ms
64 bytes from 109.70.163.2: icmp_seq=1 ttl=55 time=198.688 ms
64 bytes from 109.70.163.2: icmp_seq=2 ttl=55 time=203.657 ms
64 bytes from 109.70.163.2: icmp_seq=3 ttl=55 time=202.524 ms
64 bytes from 109.70.163.2: icmp_seq=4 ttl=55 time=202.258 ms
64 bytes from 109.70.163.2: icmp_seq=5 ttl=55 time=201.571 ms
64 bytes from 109.70.163.2:
Re:Posting doesn't match up with the speed of ligh (Score:5, Informative)
I really have no clue whether 230ms is a realistic number.
I currently get a 431ms Japan <> UK ping on a pretty mediocre Japanese ADSL line in the country side.
So, yes, that's realistic.
Re: (Score:2)
I really have no clue whether 230ms is a realistic number.
I currently get a 431ms Japan <> UK ping on a pretty mediocre Japanese ADSL line in the country side.
So, yes, that's realistic.
I imagine the route goes via the highly-congested south-east asia area, or possibly even via the U.S.
London to Tokyo is about 6,000 miles via Sibera. Via undersea cables through the red sea it's nearer 12,000 miles. Via the states it's also about 12,000 miles.
I haven't got any private lines to Tokyo, but my line to Singapore runs about 220ms IIRC.
Re: (Score:2)
Re: (Score:2)
Re: (Score:2)
Even if the UK and Japan side offer real dedicated vs best effort, you still have to move around both regions before you hit pure new optical.
Peering, telco deals can all send your packets for small or long loops before they get to fancy new projects.
Re: (Score:2)
fibre optic repeaters (amplifiers) had huge latencies (relatively speaking.)
Re: (Score:2)
and distance between tokyo and london (short) is just 5900 miles.
(but of course the cable doesn't go direct.. just saying that circumference of the globe isn't that useful to use in that)
Re: (Score:2)
Unfortunately fibers don't run in straight lines from place to place and there are processing/routing overheads too. Even so based on my own test it seems the authors of TFA are making the newbie mistake of confusing one way latency with round trip time (round trip time ~= 2x one way latency).
Tracing route to www.jp [210.157.1.134]
over a maximum of 30 hops:
1 1 ms 1 ms 1 ms gw-umain.ee.umist.ac.uk [130.88.118.250]
2 1 ms 1 ms 1 ms gw-rh.its.manchester.ac.uk [
Why focus on Trading when we talk about latency? (Score:5, Insightful)
There are lots of scientific applications where latency is critical.
But oh, that would be difficult to discuss. Much easier to relate everything to a vilify-able application.
Come on, for once, talk about the benefits of a mega infrastructure project.
Oh, right... Slashdot. My bad. That's just not what we do here.
Re: (Score:3)
The only ones willing to pay a premium for the low latency are the HFT folks. I dont think, the masses who use VOIP, choose their ISP based on the ping time to UK (most go for the obvious bandwidth). I agree, it is a win for a lot of people, but it is paid for (atleast the initial costs) by High Frequency Traders.
Hosting @ Tokyo? (Score:2)
Anyway, lower latency is always good, I don't really care if it's going to be used for HFT or not.
--Coder
Re: (Score:2)
Re: (Score:2)
There's a small hitch with that plan:
http://en.wikipedia.org/wiki/List_of_market_opening_times [wikipedia.org]
Re: (Score:2)
LSE & TSE are both 24-hr electronic trading exchanges, right?
Re: (Score:3)
Tele-medicine.
Or, more to the point: Tele-surgery.
Re: (Score:2)
Still can't win call-in shows (Score:2)
No matter what they do to fix this, no matter what they do to reduce the latency I NEVER win any radio call-in shows. You would think this would help me be caller #25 but it never works. It's always busy or I just don't make that number :(
Re: (Score:2)
Well, soon you'll be able to try your luck on Arctic call-in shows. I'd say the chances should be pretty decent there.
Re: (Score:2)
Yeah, but the prize would be 100 lbs of whale blubber or some such.
out of context excerpt (Score:2)
In case you ever wondered how a sea cable is fixed (Score:4, Informative)
See this [slate.com].
Re: (Score:2)
But how do you pull up a cable from the ocean floor when it has all kinds of other cables crossing it?
Re: (Score:2)
As someone working in Australia... (Score:3)
with a head office in the UK, I think this is awesome.
Currently the packets between Oz and the UK either go through central Asia, where there is massive packet loss, or they go the long way round - across the Pacific, across the USA and then across the Atlantic.
The new route will probably shave 40ms off the ping time from Oz to the UK as well as be pretty reliable - and also not subject to US data monitoring.
Re: (Score:2)
"...and also not subject to US data monitoring."
Do you really imagine that the US and UK don't work together on this?
Besides helping a few traders.. (Score:2)
Everything you wanted to know about undersea cable (Score:2)
Neal Stephenson's essay Mother Earth Mother Board [wired.com]
A good thing too (Score:2)
Need more cables! (Score:2)
Re: (Score:2)
A 1ms reduction in communication time can be worth millions of dollars for stock traders in Britain. If you know about a change in stock prices on a foreign market faster than your competitors then you can react quicker. You might be thinking that 1ms isn't enough time to matter but because most trading is computer based these days 1ms can make a HUGE difference because computers are doing the trading.
Almost the entire cost of this cable is already paid for and it's stock brokers that are paying for it prec
Re: (Score:2)
It's not like stock brokers somehow do something productive. All they _can_ do is to suck out money from somewhere or sometime else, sometimes even causing a _lot_ of damage doing so. So if we close the stock markets, or at least heavily regulate them, we'd all live better. Trim down the financial sector to the parts which actually benefit the population.