Subject: [NEXTEL-1] The next big thing in Web access: Power lines

From: [email-masked]
Date: Tue, 18 May 2004 23:37:42 -0400

The next big thing in Web access: Power lines

Bringing broadband over local power
lines may be the means by which
high-speed Internet access becomes
universally available. Here’s what’s
involved and how to invest in it.

Come May 24, Web surfers in the tiny
town of Everetts, N.C. -- population 172
-- will finally get to enjoy what many of
us have taken for granted for years.
A simple, high-speed connection to the
Internet.

Posted 5/19/2004
By Michael Brush

An eastern North Carolina town so small it doesn’t get cable or DSL,
Everetts will finally get hooked up with a land-based broadband link --
thanks to a cutting edge technology that will deliver Internet signals
through the town’s electrical lines. (There’s always satellite for
remote areas, but it can be clunky.)

The emerging technology is known as broadband over power line (BPL).

Everetts’ step into the present with BPL is notable even beyond the Tar
Heel State because it may well signal a step into the future for the
rest of us. And it could be an early sign of a big opportunity for
astute investors, too.
The reason: The town’s high-speed hookup, along with several other
experiments in BPL around the country, are starting to make it clear
that BPL technology could just be the next big thing in high-speed
Internet access.
The roster of players in this fertile field is growing quickly.

Big powercompanies like Cinergy (CIN, news, msgs) in Ohio,
PPL (PPL, news, msgs) in Pennsylvania and Progress
Energy (PGN, news, msgs) in North Carolina, for example, are teaming up
with EarthLink (ELNK, news, msgs) and private BPL providers like Current
Technologies and Amperion to offer BPL. They’re already rolling out
commercial BPL services in Cincinnati, Allentown, Pa., and Raleigh, N.C.

In several other towns and cities around the globe, many utilities are
busy running small BPL trials in test markets.
Obviously, BPL is still developing. But if the stars align just right,
experts say, BPL could become a big part of our lives over the next few
years. Here’s how:

Like those pioneers in Ohio, Pennsylvania and North Carolina, many
people all over the world will be turning to BPL as a faster and cheaper
alternative to DSL and cable.

Consumers will be making cheap phone calls over their power lines, too,
since BPL can be used for Internet-based phone calls -- known as Voice
over Internet Protocol (VoIP).  Movies on demand might not be far
behind.
Large structures like hotels, apartments and corporate offices -- or
even Navy ships -- will be wired with BPL, providing a cheap way to
distribute broadband to every nook and cranny.

Remote towns all around the country, not only Everetts, will use BPL to
get the high-speed Internet connections they’ve been denied for years.

BPL will be used for home networking, distributing high-speed Internet
access around your house through the electrical wiring.
How BPL works

In fact, the first application to take off is likely to be home Internet
access, in part because it is pretty straightforward. Users connect
their computers to power lines outside their homes in two ways,
depending on what kind of service they get. They can use a Wi-Fi
networking connection that links them right into the power line. (Wi-Fi
is a wireless network where signals can be transmitted a few thousand
feet at most.) Or they can pay $30 for a modem that plugs into a wall
socket. That modem sends their signal to a coupler that routes it around
a transformer, so it can hit the main power line.

Once connected to power lines, Internet signals get shuffled along by
repeaters. At some point, they’re bundled with other signals and
channeled onto the Internet backbone by a node. The bottom line to all
this for investors: These are all pieces of equipment that will sell
briskly if BPL ever takes off. (We’ll get to potential stock-market
plays in a moment.)
The future for BPL

But will BPL succeed? Though there are several challenges we’ll get to
in a second, the technology has many things going for it, including:

It’s easy to use. And no, you don’t get shocked.

“All you do is take the modem out of the box plug it in, and, if you can
sign up for e-mail, you can sign up for our service,” says Jay Birnbaum,
the general counsel for Current Communications. The Germantown, Md.
company has joined with Cinergy to provide BPL in the Cincinnati area.

The price is right. The going monthly rate is a little cheaper than DSL
or cable. And you get more speed. Users pay $30 per month for the
slowest speed, or 1 megabit per second (Mbps). That beats most DSL and
cable connections, depending on the time of day. BPL users can pay an
additional $5 and $10 for speeds in the 2 Mbps and 3 Mbps range,
Birnbaum says.
BPL offers the same speed in both directions. This makes it a lot easier
to send large picture or music files. DSL and cable typically offer fast
downloading connections but very slow speeds for sending files.

And so far, Web surfers trying out BPL in small trial groups around the
country think it’s cool.  “The technology works very well,” says Rick
Swink, who oversees BPL trials and development at the Washington,
D.C.-based Pepco Holdings (POM, news, msgs). “The customers seem to be
very happy.”

Based in part on good feedback from its trials, Cinergy, one of the
leaders among utility companies developing BPL, predicts 15% to 20% of
its customers will eventually sign up. The company has only been wooing
paying customers for several weeks. “But so far the response has been
good,” says Alex Pardo, who oversees BPL development at Cinergy Ventures
Group.  The company plans to introduce VoIP later this summer.

Here’s another plus for BPL: It has very strong support in Washington,
D.C., right from the top.  “President Bush has given talks on delivering
broadband to rural areas,” says Reggie Bruce, the chief executive of
Copper Road, the small Raleigh, N.C., company that’s bringing BPL to
Everetts. “I think the politics are behind it to make it work. The DSL
and the cable companies are not going into these sparsely populated
areas because it does not fit their business model.”

A few levels down in the capital, Federal Communications Commission
Chairman Michael Powell backs BPL -- not just as an alternate source of
broadband but also as a way to keep competition alive in the phone
sector. “The FCC is very enthusiastic,” says John Joyce, CEO of BPL
equipment maker Ambient (ABTG, news, msgs).

The pure plays on BPL
One problem for investors is that many of the leading companies offering
BPL equipment and services are still private -- from Current
Technologies and Amperion (which offers the Wi-Fi link up), to Main.net
in Israel and Design of Systems on Silicon, a Spanish company.

And one of the two companies in the space that are public --
equipment-vendor Ambient -- looks like a bankruptcy risk because it
trades for about 25 cents per share.

But Ambient shares may be safer bet than they look. The company has
friends in high places.  The New York utility Consolidated Edison (ED,
news, msgs) has a stake in Ambient, and Con Ed is running BPL trials
with the company. Ambient also has a partnership with EarthLink, an
Internet service provider. If BPL ever takes off, Ambient shares could
get a nice lift.
Next, investors should consider a small company called Telkonet (TKO,
news, msgs). Its equipment transmits broadband signals over the
electrical wiring in hotels and apartment buildings. The market is big,
given that there are 40,000 hotels and 30 million apartment buildings in
the country. Telkonet also has potential customers in government and
defense, where BPL might be used on Navy vessels and military bases.

Telkonet has alliances with satellite TV provider DirecTV Group (DTV,
news, msgs), a big government contractor called Anteon International
(ANT, news, msgs) and Leviton Companies, which makes electrical
components. It may also team up with power companies and DSL and cable
providers that need help distributing broadband signals in buildings.

Headquartered in Annapolis, Md., Telkonet recently signed a small deal
with the Army Corps of Engineers, which will use Telkonet gear to help
monitor dams. But bigger deals may soon follow. “We are inundated with
business opportunities,” says Ron Pickett, Telkonet’s president and
chief executive officer. “It is just every day, more and more proposals.
The international side of things has been just explosive.”

EarthLink, though not a pure play, is worth watching for a few reasons.
It’s in on several experiments with BPL. So if BPL ever takes off,
EarthLink can hit the ground running.  EarthLink also got another round
of robust earnings-estimate increases in late April, often a positive
sign. Finally, the company looks dirt-cheap by one measure. With a
forward price-to-earnings ratio of 10, EarthLink trades for half its
medium-term growth rate of 20%.

How the utilities may get into BPL

The most profitable way for utilities to offer BPL is to set up a
telecom division to run the service outright. That’s what PPL in
Pennsylvania is doing. At the other extreme, utilities wary of getting
tangled up in a new consumer service will passively offer access to
their networks for a fee, says Henry Quintin of Fine Point Technologies,
which sells software that helps users install BPL. They’ll make less
money, but the risks of getting bogged down in customer service are
lower. Pepco is going this route, he points out.

The middle road -- both for profits and risk -- is a joint venture with
a service provider. The marriage between Cinergy and Current
Technologies is a great example. But can a joint venture like this
produce enough profits to move the earnings needle at a giant utility
like Cinergy? A quick back-of-the-envelope calculation raises some
doubts.

Cinergy hopes to offer BPL service to 250,000 homes within three years,
and it expects that 15% to 20% of customers will sign up. That suggests
50,000 customers will be paying $40 per month, or $24 million per year.
If the service produces 20% profit margins, Cinergy’s 50% split of
profits with Current Technologies would give the utility $2.4 million
from BPL. With 180 million shares outstanding, that works out to 1.3
cents per share.

Cinergy’s take, however, could get bigger once VoIP is added -- not to
mention video further down the road. Plus, Cinergy will soon start
reaching out to more customers in Indiana and Kentucky. So, potential
profits could be higher.

Even if it takes a few years to generate meaningful profits, utilities
believe they can gain from BPL right away because it helps with
automated meter reading and network monitoring. “It is like having an
intelligent distribution grid sitting out there,” says Leif Ericson, a
business development manager at Southern Company (SO, news, msgs), the
big regional power company in the Southeast. “I can tell exactly where
that tree fell on the line.”

Potential roadblocks

As good as BPL sounds, it faces several obstacles. Despite exceptions
like Cinergy and PPL, for example, many utility companies are
notoriously slow to adapt to new ideas. Next, a variety of “last mile”
Internet-access technologies compete with BPL -- from DSL and cable to
more cutting-edge options like fiber to the premises and WiMAX -- a
wireless network that transmits signals over as much as 30 miles.

And despite the warm glow from the nation’s capital, there are several
regulatory issues that could snag BPL, says Andy Lipman, a Washington,
D.C. lawyer and telecom regulation expert of the law firm Swidler Berlin
Shereff Friedman in Washington, D.C.

First off, ham radio operators hate BPL. A vocal group that’s raised
lots of money for the fight, they’re concerned that BPL interferes with
their radio transmissions. Next, regulators have yet to decide whether
VoIP should be treated like regular phone service. If so, that will push
up costs and reduce interest among consumers. What’s more, state utility
regulators may slap BPL with surcharges to cover the cost of power
lines.

Lipman believes upcoming technical studies will prove the ham radio
operators wrong. And most of the other potential regulatory snags will
be resolved, he says. So if more utilities get on board and consumers go
for the service, the future could be bright for BPL companies. After
all, the field is still wide open -- given that 80% of Internet users
still haven’t made the transition from dialup to any form of broadband
at all.

At the time of publication, Michael Brush did not own or control shares
in any of the companies listed in this column.

http://moneycentral.msn.com/content/P81685.asp

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From: "Kenneth Van Patten" <[email-masked]>
Date: Wed, 19 May 2004 09:39:11 -0400

Who wrote this piece of garbage.

----- Original Message ----- 
From: <[email-masked]>
To: <[email-masked]>
Sent: Tuesday, May 18, 2004 11:37 PM
Subject: [NEXTEL-1] The next big thing in Web access: Power lines

> universally available. Here's what's
> An eastern North Carolina town so small it doesn't get cable or DSL,
> through the town's electrical lines. (There's always satellite for
> Everetts' step into the present with BPL is notable even beyond the Tar
> The reason: The town's high-speed hookup, along with several other
> Technologies and Amperion to offer BPL. They're already rolling out
> years. Here's how:
> get the high-speed Internet connections they've been denied for years.
> 
> repeaters. At some point, they're bundled with other signals and
> briskly if BPL ever takes off. (We'll get to potential stock-market
> plays in a moment.)
> The future for BPL
> 
> But will BPL succeed? Though there are several challenges we'll get to
> It's easy to use. And no, you don't get shocked.
> 
> "All you do is take the modem out of the box plug it in, and, if you can
> sign up for e-mail, you can sign up for our service," says Jay Birnbaum,
> country think it's cool.  "The technology works very well," says Rick
> D.C.-based Pepco Holdings (POM, news, msgs). "The customers seem to be
> very happy."
> 
> paying customers for several weeks. "But so far the response has been
> good," says Alex Pardo, who oversees BPL development at Cinergy Ventures
> Here's another plus for BPL: It has very strong support in Washington,
> D.C., right from the top.  "President Bush has given talks on delivering
> broadband to rural areas," says Reggie Bruce, the chief executive of
> Copper Road, the small Raleigh, N.C., company that's bringing BPL to
> Everetts. "I think the politics are behind it to make it work. The DSL
> areas because it does not fit their business model."
> 
> sector. "The FCC is very enthusiastic," says John Joyce, CEO of BPL
> monitor dams. But bigger deals may soon follow. "We are inundated with
> business opportunities," says Ron Pickett, Telkonet's president and
> chief executive officer. "It is just every day, more and more proposals.
> The international side of things has been just explosive."
> 
> It's in on several experiments with BPL. So if BPL ever takes off,
> telecom division to run the service outright. That's what PPL in
> which sells software that helps users install BPL. They'll make less
> If the service produces 20% profit margins, Cinergy's 50% split of
> Cinergy's take, however, could get bigger once VoIP is added -- not to
> automated meter reading and network monitoring. "It is like having an
> intelligent distribution grid sitting out there," says Leif Ericson, a
> big regional power company in the Southeast. "I can tell exactly where
> that tree fell on the line."
> 
> Potential roadblocks
> 
> notoriously slow to adapt to new ideas. Next, a variety of "last mile"
> And despite the warm glow from the nation's capital, there are several
> First off, ham radio operators hate BPL. A vocal group that's raised
> lots of money for the fight, they're concerned that BPL interferes with
> up costs and reduce interest among consumers. What's more, state utility
> still haven't made the transition from dialup to any form of broadband
> at all.
> 

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From: "SueNY" <[email-masked]>
Date: Wed, 19 May 2004 14:05:54 -0400

Having a bad day are we??

SueNY

  ----- Original Message ----- 
  From: <[email-masked]>
  To: <[email-masked]>
  Sent: Tuesday, May 18, 2004 11:37 PM
  Subject: [NEXTEL-1] The next big thing in Web access: Power lines

   
  Yahoo! Groups Links

---

From: "Kenneth Van Patten" <[email-masked]>
Date: Wed, 19 May 2004 14:34:05 -0400

Not really, I was sitting here listening to the power line hum in our lowband base station receiver when that article popped up.  
  ----- Original Message ----- 
  From: SueNY 
  To: [email-masked] 
  Sent: Wednesday, May 19, 2004 2:05 PM
  Subject: Re: [NEXTEL-1] The next big thing in Web access: Power lines

  SueNY

    ----- Original Message ----- 
    From: <[email-masked]>
    To: <[email-masked]>
    Sent: Tuesday, May 18, 2004 11:37 PM
    Subject: [NEXTEL-1] The next big thing in Web access: Power lines

     
    Yahoo! Groups Links

        Yahoo! Groups Sponsor 
              ADVERTISEMENT

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From: [email-masked]
Date: Wed, 19 May 2004 14:32:17 -0400

By Michael Brush

So tell us how you really feel.
Fell free to post any article that you feel is better.
So we may discuss it.

 
Yahoo! Groups Links

---

From: "Bill Smith" <[email-masked]>
Date: Wed, 19 May 2004 18:28:53 -0400

Well, the obvious solution is to dump the low band and go NEXTEL!!!!!!!  :-)

What's Nextel's position on BPL? I would think they support it since it
might force a few customers their way. Or are they against it because THEY
want the data business?

  _____  

From: Kenneth Van Patten [mailto:[email-masked]] 
Sent: Wednesday, May 19, 2004 14:34
To: [email-masked]
Subject: Re: [NEXTEL-1] The next big thing in Web access: Power lines

Not really, I was sitting here listening to the power line hum in our
lowband base station receiver when that article popped up.  

----- Original Message ----- 

From: SueNY <mailto:[email-masked]>  

SueNY