The internet's physical backbone is increasingly dominated by a handful of U.S. tech giants (Google, Meta, Amazon, Microsoft), creating strategic vulnerabilities and concentrating control over global connectivity.
Geopolitical tensions, particularly between the U.S. and China, are actively fragmenting the global internet, leading to a halt in direct cable connections and a potential 'bifurcation' of the underlying infrastructure.
Subsea cables are critical, yet highly vulnerable, national security assets subject to threats from state-sponsored sabotage, military conflict, and even natural disasters.
The massive data requirements of the AI boom are placing unprecedented demand on subsea cable capacity, accelerating the need for new infrastructure and intensifying existing geopolitical and corporate rivalries over its control.
Nations are increasingly militarizing the protection of undersea infrastructure, with countries like the UK and Baltic states dedicating naval and coast guard assets to patrol for potential threats from actors like Russia.
Historical Context
Subramanian notes that modern subsea cable landing points in India, like Mumbai and Chennai, are the same cities used for telegraph cables a century ago, showing a path dependency in infrastructure.
Technological Advancement
He explains that the development of wave division multiplexing exponentially increased the capacity of fiber optic cables, a key technological enabler for the modern internet.
Recent Past
He observes a major shift in ownership, where Big Tech companies like Google, Meta, Amazon, and Microsoft began funding and owning the majority (two-thirds) of new subsea cables.
Present Day
Subramanian describes a state of heightened geopolitical tension where no new direct cables have been laid between the U.S. and China for years, and the U.S. government is actively blocking completed projects involving Chinese firms.
Current Tensions
He reports that nations are actively militarizing the protection of undersea infrastructure, with the UK assigning naval vessels and Baltic states increasing patrols in response to perceived threats from Russia.
Emerging Driver
The AI boom is identified as a significant new factor creating an unprecedented data burden on the subsea cable industry, driving demand for future capacity.
▶Geopolitical Weaponization of Internet InfrastructureMay 2026
Subramanian details how subsea cables have become a key battleground in great power competition. He highlights U.S. sanctions blocking Chinese-involved cables, the lack of new U.S.-China connections, and military concerns from Taiwan, the UK, and Baltic nations regarding potential sabotage by China and Russia.
Investors and analysts should view internet infrastructure not just as a utility but as a strategic asset class where geopolitical risk can render multimillion-dollar projects inoperable overnight, as evidenced by the completed but inactive U.S.-blocked cable.
▶The Corporate Consolidation of the Internet's BackboneMay 2026
Subramanian argues that the internet's core infrastructure is undergoing a significant shift from consortium-led projects to private ownership by a few tech behemoths. He states that Google, Meta, Amazon, and Microsoft fund or own two-thirds of new cables, giving them gatekeeper power over which nations get connected, as seen with Meta's 'To Africa' cable.
The dominance of Big Tech in subsea cables creates a strategic dependency for nations seeking connectivity, potentially forcing them to compromise on data sovereignty rules to avoid being bypassed, which represents both a risk and a point of leverage in negotiations.
▶Physical Vulnerability and Strategic ChokepointsMay 2026
The analysis emphasizes the tangible fragility of global connectivity, citing the Tonga volcanic eruption that severed a nation's only cable. Subramanian identifies critical chokepoints like the Red Sea and the Strait of Hormuz, where a malicious actor could cause widespread disruption by targeting the high concentration of cables.
The physical security of subsea cables is an emerging and underappreciated risk factor; increased military patrols by nations like the UK suggest a future where insurance and operational costs in contested maritime zones could rise significantly.
▶The AI Boom as a Demand CatalystMay 2026
Subramanian identifies the recent AI boom as a major new driver of demand for subsea cable capacity. The massive data flows required for training and operating models like ChatGPT and Claude are creating a significant new data burden on the existing infrastructure, accelerating the need for more and higher-capacity cables.
The explosive growth in AI will likely trigger a new investment cycle in the subsea cable industry, creating opportunities for cable-laying companies, component manufacturers, and data center operators located at key cable landing points.