Utility to offer high-speed Internet over power lines

Wednesday, March 3rd 2004, 12:00 am

By: News On 6

CINCINNATI (AP) _ A division of utility Cinergy Corp. plans to offer high-speed Internet service over its power lines, letting customers connect by simply plugging a computer modem into existing electrical outlets.

The idea of broadband service over power lines, or BPL, has been around for some time, but this appears to be the first large-scale rollout of the technology by a major utility.

``There have been several utilities working on this quietly and doing pilot programs,'' said Alan Shark, president of the Power Line Communications Association, an industry trade group. ``Everyone has been very cautious in deploying this technology, but I think the demand will be incredible.''

Cinergy Broadband LLC is teaming up with Current Communications Group LLC, a Germantown, Md.-based technology company, to offer the service in sections of Cincinnati this year. Plans call for an eventual expansion into Kentucky and Indiana; Cinergy hopes to market the service to 55,000 of its 1.5 million customers this year.

A second venture will bring the technology to smaller municipal and cooperatively owned power companies, covering 24 million customers across the United States.

The parties are committing more than $70 million to the ventures.

``We had very positive results from a pilot program that we began last January in about 100 homes and about 75 percent said they were very satisfied and willing to sign up for commercial service,'' said Cinergy spokesman Steve Brash.

Tim Barhorst, 51, of Cincinnati, was in the test program and is sold on the service.

``I have a home office and I have used DSL and cable, but I would choose BPL over them,'' said Barhorst, a technology consultant. He said the speed is comparable to the high-speed cable services and faster than DSL. ``It has been very reliable and is the most cost-efficient for me.''

Cinergy and Current Communications believe that the new technology offers several advantages over DSL and cable modem service, including the fact that no professional installation or additional wiring in a home is needed.

The service will be provided at three pricing levels, from 1 megabit per second for $29.95 a month to 3 megabits per second for $39.95 a month.

Customers will get one free modem, which must be plugged into an electrical socket for the system to work. Additional modems for multiple outlets will cost $30 to $40 each.

One major broadband rival, Time Warner Cable, claimed not to fear the competition. Spokesman Keith Cocozza said his company could offer better value by bundling several services together, such as Internet access with cable TV and phone service.

The Federal Communications Commission has said it will begin developing rules for the technology as another way to provide broadband access to consumers. FCC Chairman Michael Powell said last year that because every building has a power plug, it ``could simply blow the doors off the provision of broadband.''

However, BPL has its critics, including the American Radio Relay League, a national association of amateur radio operators. The group contends that power line data transmissions will interference with radio tuned to the same frequency.

David Sumner, the league's chief executive, said that can cause problems for not only ham radio operators, but also short-wave broadcasts and military, public safety and government communications.

Cinergy's Brash, however, said interference has not been a problem.

In general, here's how the technology works. Data travels on medium-voltage wires in the power grid, getting transferred to fiber-optic or telephone lines to skip disruptive high-voltage wires.

Because signals can only make it so far before breaking apart, electronic devices on the power line reamplify packets of data. More elaborate techniques detour the signals around transformers before the data gets zipped into homes via the regular electric current.

Matt Davis, director of broadband services for the Yankee Group, a Boston-based research firm, is concerned that BPL technology has not developed sufficiently to be competitive and drive costs down. He also thinks it will struggle to compete with the bundled packages offered by cable and phone companies.

``I don't want to shoot it down, but there are some key things that are stacked against them,'' he said.

Karen George, research director for Primen, a Boulder, Colo.-based research company that tracks the retail energy market, says utilities have emphasized that providing Internet service will be important in underserved rural and suburban markets.

``The question is whether utilities will be able to make money off of it,'' she said.