Subject: [NEXTEL-1] Powering the Internet

From: Marcelrf <[email-masked]>
Date: Fri, 05 Mar 2004 10:07:38 -0500

Powering the Internet
By Jack Naudi
Of the Post-Dispatch
03/04/2004

Dan Niswonger zips along the Internet on a digital highway that most
folks can't travel - yet.
Though telephone lines or cable wires carry most high-speed signals
today, Niswonger and 50 of his neighbors in Cape Girardeau, Mo., are
testing a new technology: They hook into the Internet using the same
electrical outlet that powers televisions, toasters and lamps.

And their Internet signal is carried along power lines owned by
AmerenUE.

"I can't quite comprehend that something that will kill you when you put
your finger into it can get a signal into the Internet," Niswonger said.

With the exception of a couple of small cities, broadband over power
lines, or BPL, remains an almost unheard-of concept in the United
States. But after 18 months of testing, Ameren Corp., the St.
Louis-based parent company of AmerenUE, is optimistic about the system.

"The technology has proven it works at a pretty decent scale," said
Steve Kidwell, manager of business improvement for Ameren.

Niswonger goes further: "It has been fantastic."
It also has been a long time in coming. Utilities have known for a while
that digital signals can piggyback on the same lines that carry
electrons.

But movement is the easy part. What's more troublesome is keeping
electrical interference from turning high-speed digital signals into
indecipherable, scrambled messes.

In recent years, several companies have devised software and hardware to
keep those things intact. With each tweak, the interference has been
reduced, and Internet connections are getting faster and faster.

Today, the average Cape Girardeau test customer can download images,
video and data from the Internet at about the same speed as service over
digital subscriber lines, offered by telephone companies.

BPL soon could rival the top speed offered by cable broadband systems,
about four times as fast as DSL. In theory, Kidwell said, power-line
Internet connections have no maximum speed.

Power lines have another advantage: They're everywhere. Many sections of
the country can't get DSL service from telephone companies or high-speed
Internet connections through cable-television wires. But virtually every
home or business in the nation is tied into the electric power grid.

"I get calls from people every day saying, 'When can I have it?'" said
Alan Shark, president of the Power Line Communications Association, a
trade group promoting BPL technology.

Eager to get high-speed Internet availability into as many homes as
possible, the Federal Communications Commission has been pushing the
power-line access. Last month, it released a proposed set of rules
designed to allow utilities to begin rolling out the system virtually
anywhere in the United States.

In a statement, FCC Chairman Michael Powell hailed the coming of
"another broadband pipe" to compete with DSL and cable.

Despite the FCC's endorsement and support, "Utilities have been
extremely conservative and extremely cautious," Shark said.
"I cannot get an executive (from the utilities) to my meetings, because
they say, 'Our job is a utility,'" Shark said. "They are spending their
time worrying about the core business."

Bold step

The city of Manassas, Va., which operates a municipal electric company,
soon will roll out BPL service citywide. But most for-profit monopoly
utilities are sitting on the sidelines, leaving Ameren virtually alone
in the field.

Ameren is expected to end the Cape Girardeau test in a month or two. It
plans to start rolling out access to an undisclosed broader area shortly
afterward.

Moving into an unknown market would be a bold step for a company
renowned for sticking to its conservative utility roots.
While many utilities in the 1990s rushed into exotic side businesses,
such as trading power, banking, insurance and telecommunications, Ameren
remained a tortoise and maintained its winning strategy. Today, it is
one of the financially strongest utility holding companies in the
country.

After Chuck Mueller retired Dec. 31 as chief executive and chairman,
Gary Rainwater took over, pledging to stay the course.  In that context,
providing Internet service seems decidedly un-Ameren-like.

Kidwell is aware of that. "This is a strategic decision for Ameren," he
said. "So, our approach is it's a very interesting use of our
infrastructure that we hadn't envisioned when it was built. But we also
aren't a telecommunications company."
Indeed, as a regulated monopoly, whatever Ameren does probably will have
to be reviewed by state regulators.
"There would potentially be a regulatory issue with the use of the
utility's regulated assets for a business like moving broadband over
power lines," said Warren Wood, chief of the Missouri Public Service
Commission's energy division, which regulates AmerenUE.

But the level of the review would depend on Ameren's involvement in
supplying BPL service.
It's likely, Kidwell said, that Ameren would work with partners.  For
example, the utility might lease its lines to another company that would
sell broadband service into a particular market.

In front

In fact, even for the small test in Cape Girardeau, Ameren has a
partner, Big River Telephone Co., which serves southeast Missouri. Big
River essentially provides the customer support, technical assistance
and a link from the Internet's framework, known as its backbone, to
Ameren's power lines.

Big River also provides a connection from the Internet backbone to the
power lines and the servers that allow customers to have e-mail. The
company hopes the partnership will expand after the test phase.

"Our experience has been good, and I think Ameren has been happy with
the service," said Jerry Howe, Big River's chief executive.

Big River does not offer DSL, so broadband over power lines would be the
company's first offering of high-speed Internet access.

Perhaps the biggest concern by Ameren and Big River is that they could
be too far ahead. A wary public might be reluctant to buy into a new
technology.

"You don't want to be out there too far in advance," Howe said.  "But we
have had this technology deployed for 18 months. It's not like we're
putting it out with no experience."

Big River and Ameren have discussed pricing for the service, but they
aren't revealing numbers. "The price will be competitive with cable and
DSL," Howe said.

That would put the cost to customers at about $30 to $40 a month.

As a tester, Niswonger has been involved in pricing discussions.  "I'm
not at liberty to talk about it," he said. "But I'll tell you one thing,
the cable company is going to have a fight on their hands.

"I think it's going to take off. It's going to be a monster."

For now, Charter Communications Inc., which offers high-speed cable
service in the St. Louis area and elsewhere, and SBC Communications
Inc., which provides DSL, say they're not worried.

"Our space in the broadband area has been repeatedly invaded," said Tom
Hearity, vice president and associate general counsel for Charter.

"These guys are one more competitive entry, and there probably will be
more after this," Hearity said. "But the more competitors that come in
the marketplace, the better that cable looks."

SBC "continues to believe that DSL is the right broadband technology for
today's needs as well as future broadband needs," spokeswoman Ann
Balsamo said in a statement.

And despite enthusiasm over the technology, Ameren executives, if
anything, are playing down the potential.
"This is a very competitive and fast-paced business," Kidwell said.
"Where broadband over wires can really compete with cable or DSL remains
to be seen."

FAQs

Can I get this now?

Testing on broadband over power lines, or BPL, is nearly complete; a
broad rollout has not been set.

How much will it cost?

The price is expected to be comparable to DSL and cable modem, about $30
to $40 a month.

Will my same equipment work with it?

In theory, BPL could be available in any building with electricity.  And
like DSL and cable, BPL requires a special modem and software.

How fast is the connection?

BPL has no theoretical maximum speed. Today, it's about the same speed
as DSL. The top cable speeds are about four times as fast as DSL and
BPL.

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