Power line player Amperion gambles on new cash, new model

Friday, March 7, 2008
Mass High Tech: The Journal of New England Technology - by Efrain Viscarolasaga Mass High Tech

Broadband over power lines was all the rage after advancements in technology just a few years ago made it possible, following a set of rules the Federal Communications Commission adopted in 2004 for its deployment.

But since then, competition from nearly ubiquitous fiber, cable and DSL has kept deployments of broadband over power lines, or BPL, technology in pilot or test status. The slowdown also sent one local maker of BPL technologies, Amperion Inc., into an 18-month timeout -- executives stopped selling and focused on the drawing board. Now, the Tewksbury company is emerging from its hiatus with $2.9 million in new funding and plans in the coming weeks to unveil new products and a new business model.

The funding, which has gone unannounced, was provided by investors GIV Venture Partners and RedLeaf Group Inc., both of Pennsylvania, and by Aspen Ventures of Connecticut.

The 40-person company will now incorporate a hybrid network of both BPL and wi-fi technology -- rather than focusing on the entire network, from a home's outlet to the utility's substation. The idea, said CEO Rajiv Salimath, is to take the best of both BPL and wi-fi and marry them for utilities, carriers, municipalities or enterprises looking to expand their networks.

"BPL has its place in many areas, but it's not an over-arching technology for every application and place," Salimath said.

Data connections are considered to perform better over wi-fi, while voice over Internet protocol and smart-grid applications are usually better over BPL. "Smart grids" refers to the transformation of a traditional power infrastructure into a communications network, which enables utilities to manage demand in real time, check meters remotely and charge customers for real-time usage and implement other applications that can make the grid more efficient.

Mesh network over power lines
The relaunch of Amperion comes at an opportune time, according to industry insiders. Smart-grid applications could be the future the BPL industry has been looking for, and both federal and state governments have begun passing legislation intended to encourage utilities to make their networks smarter and improve energy efficiency.

U.S. utilities are expected to invest between $70 billion and $120 billion in smart-grid technologies between now and 2020, according to Robert Robinson, a vice president in the utility practice of Virginia-based consulting firm Booz Allen Hamilton.

Amperion's new PowerWiFi product is essentially an access point that, when deployed in a group, creates a wireless mesh network that routes traffic to either a BPL or wi-fi backhaul. Each node can provide a wireless link to homes within a 300-meter radius, and backhaul the traffic using either BPL or wi-fi.

The company will also use part of the funding to establish a new consulting and integration business, according to Salimath, which will focus on working with utilities to institute new smart-grid technologies.


The shift in direction is a gamble for Amperion, but one that even executives at Bay State rival Ambient Corp. say makes sense.

"We believe there is no one common technology that will make smart grids work," said Ambient CEO John Joyce. "A hybrid solution is the only way it can work."

Ambient, which is based in Newton, has been including wi-fi aspects in its products for more than a year, according to Joyce. The publicly traded company is also bolstering its capital, closing two separate $2.5 million private placements over the past four months.

Joyce acknowledges the BPL industry has seen its challenges during the past few years, but said the new activity in technology development and interest in smart-grid applications could push it toward the forefront of the utility industry, and possibly the broadband industry.

"The focus is clearly on the utility smart-grid applications now," he said. "Yes, 2005 was a year where BPL seemed to generate a lot of interest, but 2008 is going to be considerably more with the new bills and focus on energy efficiency."