Old Consumers power lines are on a new mission: Bringing another Net option into homes

Thursday, July 19, 2007
Juicing the Web

Old Consumers power lines are on a new mission: Bringing another Net option into homes
Eric Morath / The Detroit News

How BPL works !!!

Some Michigan residents will be among the first in the country to get their Internet connection from their power lines.

Consumers Energy, the state's second largest utility, is leasing its power lines to Los Angeles-based Utility.net to deploy a broadband-over-power-line network.

While the service could work in either rural or urban areas, Utilty.net plans to focus its efforts on outlying areas that many do not have access to broadband Internet through cable or phone providers.

Before the end of the year, the two companies intend to have 10,000 homes connected in Grand Ledge, a city just west of Lansing.

Eventually, Utility.net intends to roll out the service to more than a million customers statewide, along Consumers' electrical grid. Jackson-based Consumers has 1.8 million customers in Michigan, including residents of Livingston and northwest Oakland counties.

"We are pleased to see our existing infrastructure being utilized to provide additional choices and options for broadband Internet access," said Gerry Wyse, Consumers Energy's project manager. "(Utility.net) intends to bring broadband to communities in central Michigan that have few or no broadband provider choices today."

The Grand Ledge rollout will be the company's first with a public utility. To date broadband-over-power-line service has been limited to small, rural electric co-ops in the United States. It's more widely used in rural parts of Europe.

The partnership with Consumers could serve as national model.

"We know there is a tremendous demand for this service," said David Flaxman, Utility.net vice president for business development. "There are lots of parts of the country which have zero or just one option for broadband service. People in those areas are eager to see some competition."

How the service works

The broadband-over-power-line network uses the existing power grid as a vehicle to send Internet data via a radio frequency. When a signal sent from a substation reaches a house, a specialized modem picks up the signal through an electrical outlet.

Consumers won't disclose the financial terms of its lease agreement with Utility.net. But Wyse said the size of Utility.net's service area will ultimately determine how much revenue Consumers gets from the deal.

Internet service providers, not yet disclosed, will market the service to potential subscribers. Flaxman said at first Utlilty.net will work with local providers, but hopes to also offer its services through a national player.

The concept has existed for nearly a decade, but previous attempts failed because the signal couldn't be carried much more than a mile. Utility.net has technology that strengthens and clarifies the signal though a series of relays along the line, Flaxman said.

Prices for the service also have not been established, but he said it would be comparable to prices for DSL (digital subscriber line) and cable Internet services. Utility.net plans to offer services ranging in speed from 768 kilobits per second to 3.0 megabits per second. That is comparable to DSL, but still slower than cable modems.

Telecommunications analyst Jeff Kagan says he questions why it has taken so long for the technology to catch on.

"The technology makes sense, but it should be bigger than it is at this point," he said. One possible reason it isn't, he said: "Today, most consumers are moving toward a bundle where they can get a savings from buying all their services from the phone or the cable company." The power-line service doesn't provide that option.

Competition could heat up

Transmitting the Internet through power lines could provide additional competition for the likes of AT&T and Comcast, which currently dominate the broadband market in Michigan. In addition to its DSL services, AT&T is marketing its Wild Blue satellite service in areas that don't receive the more traditional high-speed line.

"I think the goal for both of us (AT&T and Utility.net) is to provide broadband access to as many people in Michigan as possible," AT&T spokeswoman Meghan Roskopf said. "AT&T is committed to a 100 percent broadband deployment through wireless and wire line services in Michigan by the end of 2007."

Detroit Edison, the primary electric utility in Metro Detroit, says it has no plans to install a similar system.

Grand Ledge resident Toney Casey said he'd welcome competition that would lower the roughly $40 a month he pays for a broadband access via a cable modem. He needs the speed for his three Web surfing teenagers, each with their own computer.

"Anything that helps the prices come down is great," he said. "It's a great thing to launch this in Michigan. We need something to build up the technology jobs in this state."