Arctic subsea communication cables and the regional development of northern peripheries

Some years ago, the Arctic Ocean was still described as one of the last oceans that did not have subsea communications cables across it. This situation is now changing. One of the greatest increases in global data transfer is predicted to be traffic between Asia and Europe, and the Arctic Ocean offers a shortcut, making physical cable connections shorter and decreasing latency. Recent developments regarding two ongoing subsea communications cable projects (Quintillion and Arctic Connect), which aim to connect East Asia and Europe, are discussed, and the connection between these projects and regional development policies in Hokkaido and northern Finland are analysed. It is shown that the proposition that improved international connectivity through subsea communications cables could bring information-intensive industries into the region had been stronger in Finland. This is largely due to a lack of information and awareness concerning these projects among the regional actors in Hokkaido; however, no concrete policy or funding instrument has been developed in either of the case regions.


Introduction
This paper focuses on two case regions and two case projects. In addition to the northern peripheries of two developed countries with a high-level of technological knowledge, Hokkaido, Japan and northern Finland (including Lapland, Northern Ostrobothnia 1 and Kainuu) have also been mentioned as potential regions to be connected by a planned cable through the Northeast Passage. This is the Arctic Connect project, which originated in Finland but is international in nature and is continuing under the leadership of the mainly state-owned Cinia Group. The other case project is led by Quintillion Subsea Holdings, which has already installed a subsea communications cable around Alaska and is moving to Phase 2 of its project, i.e., installing a subsea communications cable between Alaska and Japan.
In this study, new Arctic subsea communications cable initiatives were investigated with a two-fold objective. First, the objective was to introduce the recent developments of two ongoing subsea communications cable projects that aim to connect East Asia and Europe. Second, the objective was to analyze the connections between these projects and the regional development policies in the northern peripheries. The latter objective was converted into the research questions regarding how much decision makers and regional developers know about the Arctic subsea communications cable initiatives; what types of attitude have been adopted; what types of possibilities have been recognized and which types of links regional developers perceive between sub- For citation: Saunavaara J. Arctic subsea communication cables and the regional development of northern peripheries. Arktika i Sever [Arctic and North], 2018, no. 32, pp. 51-67. DOI: 10.17238/issn2221-2698.2018.32.63 1 In some occasions referred as the Oulu region. sea communications cables and other regional development projects; and what types of resources regional decision makers utilize to allocate support to the Arctic subsea communications cable projects. In addition to contributing to an understanding of the infrastructure projects and policy making in the Arctic and northern regions, this study contributes to discussions concerning broadband policies. Grubesic  This research is based on published reports and policy papers, newspapers and other media sources, interviews and participatory observations. As a self-reflective remark, the author would like to note his role as a contributor to the Hokkaido-based discussion concerning the Arctic subsea communications cables; however, it is believed that active participation in the discussion does not nullify one's ability to analyze the policy making and knowledge exchange processes. This article consists of an introduction to the conceptual and theoretical discussion concerning the relation between an information and communication technology (ICT) infrastructure and regional development as well as a short description of the two main Arctic subsea communications cable initiatives. This is followed by an introduction to the broadband policies and ICT industry development in Hokkaido and northern Finland, an analysis of the approaches adopted for the possibilities of the Arctic subsea communications cable initiatives and concluding remarks.

Connectivity, information and communications technologies and regional development
Internet and broadband have been described both as gateway technologies and as generalpurpose technologies. Thus, these technologies have fundamentally transformed the way both people and businesses operate and how and where economic activity is organized [2,Czernich N Still, the relation between ICTs and regional economies should not be oversimplified. For example, in the past two decades, contradicting analyses concerning the impacts of ICTs on the competitive positions of regional economies and firms' locational preferences have emerged.
While echoing claims concerning the death of distance through the availability of high-quality telecommunications infrastructures, the so-called de-concentration school has predicted a relocation of firms from expensive and congested central city locations to suburban areas; however, the concentration school has suggested that ICTs would only reinforce the advantageous position of central urban areas. During its early history, the internet was conceived as a decentralizing and geography-free technology, but many researchers have claimed that because connections and bandwidth are unequally distributed, cyberspace is dependent on the real world's spatial realities and that the internet has simply become another concentrated infrastructure layer supporting the existing hierarchies between regions. Furthermore, it is assumed that the availability of ICT solutions will not nullify the importance of face-to-face conversations and that the forces of agglomeration economies will draw firms to central locations, such as where knowledge spillovers are more likely and labour markets are more heavily concentrated. In other words, the drivers of industrial clusterisation are not overruled by the presence of modern ICTs. The third and currently dominant approach predicts more heterogenous impacts of ICTs on firm locations based on firm and industryspecific characteristics [ In addition to recognizing the continued importance of location, attention must also be focused on the significance of connectivity. Namely, it has been claimed that even remote geographical locations with multiple peering points (i.e. possibility to exchange traffic between administratively separate internet networks), abundant power infrastructures and a concentration of diverse fibre backbones are attractive to data or information-intensive industries. At the same time, the local presence of industries, such as data centers, can generate a significant demand for telecommunications services and can contribute to regional development by spurring infrastructure investments even when the local residential demand is at a relatively low level [ While these types of conclusions from the academic literature may seem promising from the perspective of the economic revitalization of remote regions, it is not clear whether they are known, accepted and shared among policy makers. The policy cycle is a relatively simple model that describes complex policy making processes and divides them into a series of stages (for example: agenda setting, policy formulation, legitimation, implementation, evaluation, termination).
While understanding that this model is not offered as theory explaining or predicting behavior and recognizing the numerous ways to label different stages, this study borrows from the vocabulary of the policy cycle to construe the steps different regional stake holders have taken vis-à-vis the Arctic data cable initiatives [8, Bridgman P., Davis G., pp. 99-100; 9, Cairney P., pp. 32-34].

The Arctic subsea communications cable initiatives
The  At the beginning of the 2010s, Arctic Fibre emerged as the second major Arctic subsea communications cable initiative. This project was developed by a Canadian company with the same name. The aim was to create a nearly 16,000-kilometre subsea fibre optic cable connection between Asia and Europe through the Northwest Passage. The new system was also expected to improve connections to remote communities in Canada and Alaska [11,Starosielski N.,. The implementation of the project became possible, though after Quintillion Subsea Holdings, based in Anchorage, Alaska, acquired Arctic Fibre's assets and became the company that would build and operate the system. Quintillion itself is a privately-owned business incorporated in 2012 4 .
Quintillion's project is divided into three phases. The construction of Phase 1, which involved a system that includes the subsea communications cables around Alaska and new terrestrial cables, has been completed and is in service. Decisions concerning the Phase 2 project, i.e. installing a subsea communications cable between Alaska and Japan, are expected to be made soon. While the illustration on Quintillion's homepage designates Tokyo as the location of the Japanese end of the cable, according to a representative, the question concerning the planned landing site in Japan is currently under consideration 5 . Group holds the primary responsibility for the advancement of the project and the establishment of a separate project organization that is to carry out the development phase (for example, legal structuring and permitting, project marketing, financial model, environmental studies, technical solutions and business plan for the implementation process), which is expected to last from 2017-2019. After the implementation phase, the cable system should be completed by the early 2020s.
While the plans concerning the routes of the cable system and the locations of the landing stations on the western end of the connection are already openly discussed, plans concerning the East Asian end are expected to become more detailed in the spring of 2018. The same can be said of the planned landing in Alaska, which was added to the project relatively recently 10 .

National broadband policies and the regional ICT industry in Hokkaido, Japan and northern Finland
Globally known assessments, such as the International Telecommunication Union's ICT De- cally but were scaled back in most countries with the onset of liberalization and privatization. He As far as the existing ICT industry is considered, significant differences can be observed be-  ognized reason for the relatively moderate development is the lack of an engine company that would have pulled others toward success in its wake. The lack of a strong local ICT industry has also been accompanied by a shortage of ICT infrastructures. While most of the international subsea communications cables land in the area near Tokyo, which also hosts a large majority of data centers and servers in Japan, only one international subsea communications cable reach to Hokkaido, connecting Japan's northernmost island with the island of Sakhalin 17 . Still, based on new strategy papers or issues raised as the main themes of events concerning the economic development of these regions, it can be concluded that the growing importance of issues such as IoT, AI and digitalization in general have been recognized in both northern Finland and Hokkaido 18 .

Different approaches to the possibilities linked to the cables
Some years ago, the Arctic Ocean was still described as one of the last oceans that was not crisscrossed with subsea communications cables [10, Delaunay M., p. 503]. This situation is now changing -not least because one of the greatest growth rates in global data transfer is predicted for traffic between Asia and Europe, and the Arctic Ocean offers a shortcut, making the physical cable connection shorter and decreasing latency. Nevertheless, the attention paid to and interest in the improved connectivity through the Arctic has not been equal in both ends of the planned connection.

Level of awareness
It is necessary to be aware of the Arctic communications cable initiatives before any connections between them and the development of any region can be envisioned. Similarly, an issue or problem has to be identified before it can be placed on the political agenda. Therefore, it is important to mention the major differences in awareness concerning the Arctic subsea communications cables. Questions concerning the Arctic Connect and its direct and indirect effects became openly debated and widely recognized issues in Finland after the Lipponen-Svento report was released. While the Finnish government has promoted this initiative both in home and international arenas, it has also been indirectly connected to Finland's chairmanship in the Arctic Council through the focus on connectivity 19 . The Arctic Connect initiative is also dependent on northern 17 20 . Signs of the wider cross-border regional approach can also be seen, such as in the joint declaration supporting the Arctic Connect from the chambers of commerce of Lapland, Oulu, Troms and Swedish Lapland 21 . Meanwhile, the Quintillion project has received surprisingly little if any visibility in Finland despite its similarity to the Arctic Connect project 22 .
In the case of Hokkaido, the discussion concerning the Arctic subsea data cables remained almost non-existent for some time. When the Northwest Passage cable project was still led by Arctic Fibre, the company openly acknowledged Hokkaido as a potential landing site in Japan. The

Attitudes, recognized possibilities and links with other regional development projects
In the case of Finland, the link between the Arctic subsea communications cables and other ICT-related projects has been strongly emphasized for years. The strategy for northern Finland, statements from different politicians and key actors representing the regional developers all refer to data centers, digital infrastructure investments and other business opportunities related to digitalization. Interviewees representing regional developers of northern Finland have emphasized the link between the Arctic Connect project and the ongoing discussion concerning the possibility to connect Finland with the Arctic Ocean through a railway connection between northern Finland and Norway. In other words, Arctic Connect and Arctic Corridor could be viewed as parts of a plan to establish a logistical corridor through which both cargo and data could travel. They have also emphasized the potential symbolic meaning of the Arctic Connect that could pave the way for the railway connection between Finland and Kirkeness 30 . At the strategical level, Arctic Connect has already been incorporated into the Transport and Logistic Strategy of Northern Finland, and to some extent, it has been incorporated into the new regional development programs of the three northern counties 31 .
The Regional Development Programme for Kainuu focuses most attention on the importance of the planned submarine communications cable connection between Europe, northern Finland and Asia. Whereas this document emphasizes this project's importance to Kainuu and envisions new data centers and investments from Asia to the region, the other regional programs make weaker references to the Northeast Passage communications cables and data centers.
Kainuu's primary interest most likely reflects the regions existing involvement in data center businesses. The plan concerning Lapland mentions the subsea communications cable along with the Arctic railway as the future connecting elements between East Asia and Europe; however, discussions concerning the latter play a much larger role in the document. The parts concerned with digitalization do not refer to infrastructures, such as subsea communications cables or data centers.
Although the ICT industry and issues such as 5G, IoT and AI play highly significant roles and despite the importance of accessibility and connectivity, which are recognized along with the Arctic possibilities in the new Regional Development Programme for Northern Ostrobothnia, neither subsea communications cables nor data centers are clearly mentioned in the document 32 . According to an informant, the wording of the document does not refer to a lack interest in the submarine cables.
However, the Regional Council seems to have a more natural role to play in the advancement of could be an indication of the more international approach that was mentioned during an interview. This document, which was prepared by the prefectural government, cites the three municipalities Ishikari, Tomakomai and Bibai as the most promising locations for new data centers in Hokkaido and emphasis their municipality-level financial support programs for data center investments.
Nevertheless, the attempts to promote Hokkaido as an attractive location for data centers have not involved international subsea communications cables since the Arctic Fibre initiative 38 .

Allocated resources
While funding schemes and subsidiary programs, for example, would be clear examples of resource allocation, the lack of such policy instruments does not necessarily imply the lack of interest. Despite the role of the public sector in the broadband policies mentioned, both academic experts and representatives of the Hokkaido Prefectural Government have emphasized that the construction of subsea communications cables is outside the traditional domain of the public sector. In other words, a small number of companies hold the decision-making power and capability to implement such processes in Japan 39 . Therefore, even if regional and local actors viewed the improvement of connectivity as a method to improve the attractiveness to data center companies, financial support for the subsea communications cable projects would not be easily accessed.
While the Japanese approach towards subsea data cables is not exceptional, as they have always The existence of various statements and strategy papers supporting the advancement of the Arctic Connect project can be considered an indicator of the shared understanding among the regional developers and economic interest groups in northern Finland; however, the leading role of private enterprises has also been mentioned by Finnish regional actors and representatives of the national government. While expressing their support for the projects, regional actors have a quite limited if any role to play, such as in the funding of the Arctic subsea communications cable project. Their role could be much larger, such as in the case of a subsea cable that is planned to be built from southern Finland to Bothnian Bay. This new cable is planned to connect the Oulu and Tornio regions in Finland and possibly also the Luleå region in Sweden with the existing cable system between Finland and Germany. The Bothnian Bay cable project is highly relevant from the perspective of the Arctic Connect project, as these planned subsea communications cables would eventually be connected with each other through a terrestrial connection. At the same time, the Bothnian Bay cable may be dependent on the willingness of local governments and local businesses to invest in landing stations, for example. The public authorities have already supported this plan in 2015, when the Centre for Economic Development, Transport and Environment (ELY Centre) of North Ostrobothnia paid half of the investigation that was conducted by a private consulting firm 42 .
The activities of local actors in the Hanko area can also be used as an example of local actors' capabilities. The local enterprises and municipalities of Hanko and Raseborg (with a combined population only around 40,000) aimed to create a significant node for international data traffic and hoped to attract new data centers to the area. Therefore, they established C-Fibre Hanko Ltd. and gathered 3 million euro to create a new branch connection for the C-Lion1 subsea data cable in Hanko. To the best of the author's knowledge, similar types of activities have not emerged, at least not yet, in northern Finland. 43

Conclusion
The Arctic subsea communications cable projects are ICT infrastructure projects that can be approached from different angles. Borrowing Catherine Middleton's words, they could be supported as enablers of the Information Age and the knowledge economy [20,Middleton C.,p. 9].
While there are regions in the Arctic where even a discussion concerning internet access as a basic human right is valid due to a lack of any or proper connections 44 , these projects seem to appear to be mainly potential business cases both in northern Finland and Hokkaido, where broadband is already widely available. In other words, regional developers' attention mainly focuses on these projects' capabilities to bridge the two global economic centers via a new connection through the Arctic; however, this type of approach does not nullify the fact that the Quintillion project has enabled fast and feasible broadband services for many remote communities in Alaska, and it may serve a similar type of role later in northern Canada. Similarly, the Arctic Connect project may become a major advancement in the availability of broadband services in the Russian Far North. Still, these projects do not necessarily easily apply to the traditional broadband policy context of Finland and Japan, where the focus has often been on spreading services to remote areas within national borders.
When comparing these two regions, it can be concluded that the proposition that improved international connectivity through subsea communications cables could bring informationintensive industries to the region has been stronger in northern Finland; however, the regional actors in Hokkaido have also shown interest in the information they have recently received. Based on the vocabulary of the policy cycle model, it can be concluded that a policy issue has been identified and that a stage of agenda setting has been reached at least in northern Finland 45 . The current approach -supporting in principle but without major economic involvement -may either reflect the outcome of the policy analysis and policy formulation processes or the ongoing natures of the processes. While the wide support that the Arctic Connect enjoys in Finland may indicate a relatively smooth legitimation process, the lack of information concerning the policy instruments and their economic impacts makes it difficult to predict the potential course of consultations between different interest groups. Furthermore, when the possibility of actions on behalf of the substate actors is considered, attention should focus on the characteristics of potential actors. In other words, while a prefecture or a county, for example, may have more resources or greater experience in large-scale development projects than a single municipality, it may lack the possibilities, rights and incentives to act. Therefore, municipalities, which often are landowners, actors in charge of the land use zoning and geographically smaller entities surrounding a potential landing station, may eventually become the key regional players, as the Hanko-Raseborg example shows.