AI boom drives $337 million subsea equipment market

The subsea optoelectronics network equipment market reached $337 million during the third quarter of 2025, rising 32.5 per cent from the previous quarter, according to market intelligence firm Omdia.

According to the company’s latest report, this market expansion reflected a sharp acceleration driven by the AI infrastructure build-out supercycle.

This robust quarterly growth of 32.5 per cent quarter-on-quarter comes as a significant terrestrial and subsea network refresh gathers pace worldwide.

“Omdia is forecasting robust subsea network growth in 2026 driven by the completion of more cables, to meet the demands of global AI networks,” said Ian Redpath, Research Director, Transport Networks, at Omdia.

“The mesh model, with the assistance of increased transmission capacity, will enable more resilient networks,” he continued.

“Omdia expects the mesh model to propagate into other ocean basins,” he added.

At PTC’26, two major architectural approaches were highlighted for building global-scale subsea network infrastructure to support AI networks.

The classic approach involves constructing the largest bandwidth subsea cable possible in a point-to-point configuration, interconnecting high-value sites across continents.

This point-to-point configuration optimises latency and construction overhead because costs can be distributed across the maximum amount of bandwidth transmission.

However, with the geopolitical environment in flux, reliability and robustness have moved to the forefront as primary design criteria.

Consequently, Google has introduced a new approach to ocean-crossing infrastructure and is completing a subsea network mesh spanning the Pacific Ocean.

Google’s subsea network features mid-ocean nodes in Hawaii, Guam, Fiji and French Polynesia, while its end-point nodes connect Asia, Australia, North America and South America.

The Pacific Ocean mesh network prioritises robustness, allowing traffic to be rerouted from a mid-ocean node in the event of a single segment failure.

It will deploy substantial mid-ocean routing capabilities to enable packet rerouting when required.

To support this strategy, the company said it carefully selects connectivity hub locations to minimise the distance data must travel before switching routes.

“We are beginning to see the early green shoots of more mesh development,” added Redpath.

“In the Southern Indian Ocean, Google has deployed the Umoja cable from Australia to South Africa, paired with terrestrial links up to Kenya,” he explained.

“In the Northern Indian Ocean, Google has announced the Dhivaru cable with mid-Ocean nodes at Christmas Island and the Maldives,” he continued.

“Christmas Island has two pre-existing links to Mandurah near but diverse from Perth and Darwin, with a fourth link announced to connect with Thailand,” he said.

“The Western terminus of Dhivaru is Oman, which has emerged as a key global node for a Bab al-Mandab, Red Sea bypass,” he added.

“In the Atlantic, Bermuda and the Azores have been introduced as mid-Ocean nodes,” he stated.

At PTC’26, Meta’s Waterworth cable project was also highlighted as a response to increasing demands for network robustness.

The Waterworth global cable will cross the Pacific from the California coast to Australia and Southeast Asia, then traverse the Indian Ocean connecting India and South Africa, before crossing the South and North Atlantic to link Brazil with the US Eastern Seaboard.

While Waterworth will support intra-regional traffic, its primary design objective is to provide a backup route around vulnerable network choke points, effectively circumnavigating areas of heightened geopolitical risk.