Submarine cables are fundamental to maintaining US tech leadership

Since the mid-1990s, the United States has established a leading position in the global technology sector, underpinned by scalable business models, pioneering research and development, and a robust global infrastructure. Submarine cables are central to this success, enabling US technology firms to serve customers worldwide by connecting domestic data centres to international markets. With the United States accounting for over 40% of global data-centre capacity, the demand for cloud and AI services continues to surge. 

However, US companies now face increasing delays and uncertainty in securing permits to land new submarine cables. These bureaucratic challenges have already forced the abandonment of several major projects, with stranded costs estimated between USD500 million and USD1 billion. Persistent delays threaten to erode US technology leadership, potentially reducing cumulative GDP by USD151–301 billion (at 2025 prices) between 2031 and 2035. Digitally deliverable services remain vital, representing ~60% of US services exports and 90% of the trade surplus in services.

If the permitting process is not improved, US firms may be compelled to spend more on resilience, diverting resources from innovation and risking a loss of competitive advantage. The cost–benefits of US-based data-centre operations could diminish, shifting investment overseas and reducing economic gains. Even a modest decline in digital economy growth could mean billions in foregone GDP. 

To safeguard its position as a global digital hub, the United States must make the approval process for submarine cable landings more predictable and efficient. This will encourage investment, reinforce economic security, and ensure continued growth in the digital economy. 

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