AI cloud anchor turns APX East into an infrastructure asset

SubCo has found a cornerstone customer for its Australia-US cable, and the tenant is an AI cloud firm, not a carrier. Australian AI cloud firm Firmus has agreed to invest US$300 million in APX East capacity over a 25-year term, a deal Data Center Dynamics reported this week.

APX East, a 16-fiber-pair system SubCo first announced in January, runs from north of Sydney to San Diego and will land in Australia at NextDC's S1/S2 site in Sydney. Service is expected in Q4 2028, followed by a Hawaii branch in Q4 2029 and a Fiji branch later; Firmus will secure up to 150Tbps of dedicated capacity.

A 25-year commitment functions as the revenue term of an infrastructure asset. Firmus is locking in a route before it is lit, and SubCo converts a speculative cable into a contracted one before the system is ready for service.

Firmus has been assembling the compute that makes the capacity purchase credible. Founded in 2019 around crypto and high-performance compute, with immersion cooling at the core of its designs, the company now describes itself as an AI factory builder. It operates a small Tasmanian facility, is developing a 90MW data center in Launceston, a 52MW site in Wesley Vale, and a 288MW project in Bell Bay, and is partnering with CDC to add mainland capacity. Project Southgate, its sovereign AI compute undertaking, plans 1.6GW through 2028.

Bevan Slattery, founder and co-CEO of SubCo, calls the agreement validation of the secure hyper-connectivity the Indo-Pacific needs, while Tim Rosenfield, co-founder and co-CEO of Firmus, describes it as an investment in Australia's ability to build AI that the world uses. The logic is the same: AI factories need international routes, and committing to a route early makes the factory build viable.

Hyperscaler-anchored assets command infrastructure pricing, while merchant builds stay self-underwritten until a committed payer appears. APX East now has that payer, but the payer is an Nvidia-backed AI cloud provider whose 1.6GW target is still ahead of its operating footprint. That shifts risk rather than eliminating it.

A cable due in Q4 2028 and a 1.6GW plan that runs through 2028 sit on the same calendar; the capacity contract and the compute buildout are bets on the same market moment.

The operating test comes when APX East lights up, by which point Firmus expects to have expanded well beyond a single Tasmanian site. Whether the factories materialize on schedule will determine if this deal becomes the template for every Pacific cable that follows or a lesson in selling capacity to a roadmap. Either way, the financing template for trans-Pacific cable has changed.