The Tasmanian government has hired a consulting firm to study whether the state should connect to SubPartner's massive international APX submarine cable project.
WorleyParsons' global advisory arm Advisian was handed $180,000 by the Tasmanian government last month to provide technical and commercial advice on SubPartners' offer for the state to tap into the APX-Central (Perth to Sydney) section of its global cable.
It has offered the Tasmanian government the ability to connect a branch spur from Tasmania to the APX-Central cable for $20 million.
The government has been considering the proposal since at least early last year.
A funding committment was left out of the state government's slimmed-down IT budget last year, and the state has been criticised for delaying a decision on the proposal.
SubPartners last year warned the state government that it would likely incur higher connection costs the longer it took to make a decision.
"If we don’t connect now, we can do so down the track, but it will be much more expensive," Greens senator Christine Milne said in December last year.
"Lowering the cost of data transmission and improving the speed means we may be able to attract new businesses to Tasmania, such as data servers and associated industries, to take advantage of our cool temperate climate, renewable energy and educated workforce."
She argued there was not currently enough data demand in the state for a private company to justify investing in a connection, but if the state government agreed to fund SubPartner spur it would attract businesses to the state and thereby increase data demand.
"It’s one of those cases of “if you build it, they will come”," she said.
Tasmania has three existing fibre connections to the mainland through Telstra and Basslink. The state has been studying options for a fourth connection since at least 2011, but ruled out a second Basslink-style cable due to cost considerations.
The APX-West Perth to Singapore cable is expected to be complete in the third quarter of 2016. It will span 4700 kilometres and has an initial design capability of 32 terabit/s over four pairs of fibre-optic circuits. It will have spurs to Indonesia's capital Jakarta as well as to Christmas Island.
The 4800km Sydney to Perth portion of the APX cable system is also scheduled for completion in the third quarter of 2016. It will have the capability to connect to Adelaide, Melbourne and Hobart with a number of branching units.
APX-East, which is to be ready for service in the fourth quarter of 2017, will cover 12,500km between Sydney and Hermosa Beach in California, with branch connections to Auckland and Oauhu, Hawaii as well as some of the Pacific islands.