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ElectricityI knew that eventually competition would begin to take hold in broadband. I first wrote about this in a reflection May 12, 1998 — and must admit that my forecast was a bit premature. But now, at last, it is happening. At last year’s Vortex Conference, Larry Babbio, vice chairman of Verizon, said that they had reduced their monthly DSL fee by $15 and that the reduction was “not promotional”. Surely, the cable companies will not stand by and lose market share. Direct TV is aggressively advertising broadband Internet access via satellite. Having multiple competing sources of broadband will result in lower prices and higher speeds. That is how free markets work. What we need is even more competition — and the electric utilities are about to offer it. In this morning’s New York Times, a story by Stephen Labation, F.C.C. Begins Rewriting Rules on Delivery of the Internet, described how the Federal Communications Commission is devising new rules which will allow electric utilities to offer broadband over their power grids.

The new alternative to the cable and phone companies will be a huge benefit for rural communities where electricity is available but cable and DSL are not. It will also add a competitive alternative where cable and DSL are available. Power line broadband is not a new idea. In fact, it has been around for many years. I have seen power line modems at Demo conferences years ago and I would not be surprised to see new offerings at Demo 2004 next week. A number of utility companies have been running trials offering high-speed Internet service through their transmission lines. In Pennsylvania, PPL Telecom began to charge their subscribers for “Broadband over Power Line” service last Spring. A person who lives in that area told me they were getting 8 megabits per second with excellent reliability.

According to the United Telecom Council, next week the City of Manassas, Virginia will go live with the first municipal power grid broadband in North America. The high speed Internet access will be available to all residents and businesses from any electrical outlet in the city. Manassas says they will have the first 2,200 homes ready to go next week and that their aggressive rollout schedule should be completed by the middle of this year.

Expect to see announcements from a number of electric utilities around the country now that all five FCC commissioners have strongly endorsed Power Line Communications (BPL or “Broadband over Power Line” as they renamed it). Lance Rosen, founder of Plexeon Logistics and Co-founder and Partner of Electric Broadband – a BPL Solutions Provider, says that the FCC has been investigating BPL since April 2003 when the commission issued its Notice of Inquiry (NOI). It has now moved to the next step which was to adopt a Notice of Proposed Rule Making (NPRM). The FCC seems to be getting behind BPL very aggressively.

Electric utilities are getting their strategies lined up and planning technical trials. The National Rural Electric Cooperative Association could become a big player — they have 900 member electric cooperatives across the U.S.. In addition, the American Public Power Association represents 2,000 municipalities in the U.S.

From a technology perspective, it looks like at least 100 megabits across the electrical wires will be possible — maybe 200. Some of the power line vendors have built an interface to WiFi so that the Internet connectivity can jump from medium voltage wires on the poles right into a home or business. It will also present yet one more backhaul alternative to the telecommunications companies. The HomePlug Powerline Alliance already has members offering the hardware to plug a LAN into an electrical socket.

Lance Rosen sums it up. ” Broadband Power Line can offer a practical and economical broadband alternative to rural, underserved, and competitive areas. This is an exciting time for BPL and the opportunity to bring broadband to the masses may finally be served by a technology that takes advantage of a ubiquitous asset – the electric wires”.