The Newfoundland and Labrador government will spend $15 million to create a new fibre optic network connecting the province with Nova Scotia.

A consortium of companies — Rogers Communications, Persona Communications and MTS Allstream — will pool an additional $37 million to build the network, which will compete with the sole existing system, run by Bell Aliant. 

Innovation Minister Trevor Taylor says a second fibre optic network is essential for growth in Newfoundland and Labrador's economy.
(CBC)

The decision comes two weeks after a small fire at a Bell Aliant switching station knocked out most telecommunications in the St. John's area — including access to 911 — for about four hours.

The proposal, though, had been put together long before the fire knocked out telephones, bank machines and internet access.

"This is absolutely needed," said Trevor Taylor, the province's minister of innovation, trade and rural development, who said the province has been too dependent on the Aliant network.

"It's our belief and their belief that — whether we did it now or not — this piece of infrastructure is an absolute necessity for the province of Newfoundland and Labrador and would have to be built."

In return for its investment, the province will have an equity stake in the fibre optic lines.

The network will involve two fibre optic links between St. John's and Halifax. Different routes — over land and under water — will be used to ensure a backup is available should one fail.

Paul Hatcher, the chief operating officer of Persona Communications, said the network will broaden access to high-speed internet and other services. 

Paul Hatcher said the new network will broaden access to high-speed internet and other services.
(CBC)

"There's a level of innovation that we can step up to in this kind of infrastructure that is tough to do with a single-carrier environment," Hatcher told reporters.

Cindy Roma, the chief executive officer of Telelink, which operates a large call centre in St. John's, said the Bell Aliant outage — the second in two years — may have been a blessing in disguise.

"I think it really called attention to this need and it made things happen quicker," she said.

"These discussions have been ongoing for some time, since the last time we had a blackout, and I think this really pushed this over the top, that we need to stop talking and we need to start doing."

Roma said further disruptions would put contracts with U.S.-based customers at risk.

Brenda Reid, an Aliant communications official, said the Aliant system still has integrity.

"This won't affect us, specifically.… Competitively it will, but specifically we still stand by the redundancy and reliability of our network," she said.

The new system, which will also bring broadband internet access to the south coast of Newfoundland, is expected to be in place by the end of 2007.