The American Telephone and Telegraph Co. has submitted what it said is the low bid to provide the first undersea fiber optic cable link for transatlantic telecommunications services.
The company is competing with both a French and a British company for the fiber optic contract, which will be awarded by a multinational consortium.
The fiber optic technology, designed to replace the coaxial copper cables that now carry transatlantic phone traffic, will rely on light signals generated by tiny lasers to transmit information. TAT-8, the name of the proposed fiber optic cable, should be able to relay about 40,000 simultaneous phone calls, which is more than four times the capacity of TAT-7, a coaxial copper cable that will go into service this July.
TAT-8 is expected to cost between $314 million and $452 million, depending on the points it will link. The consortium of companies and governments in North America and Europe will decide upon the cable configuration this August and will choose the contractor by November.
If approved, TAT-8 would go into operation sometime in 1988. The increase in telecommunications capacity could provide significant competition to Intelsat, the international consortium that provides global communications via satellite.
"Clearly, this would make underseas cable more cost-competitive with satellite technology," says Edward M. Greenberg, a telecommunications analyst with Sanford C. Bernstein.
This, in turn, says another industry analyst, may put pressure on Comsat, the U.S. representative to Intelsat.