One of the more interesting technologies to bring high-speed Internet access to the masses got a boost last week when search engine leader Google (Nasdaq: GOOG ) made an investment in startup firm Current Communications, which offers broadband over power lines (BPL) in partnership with Cincinnati-based utility company Cinergy (NYSE: CIN ) .
Along with Goldman Sachs (NYSE: GS ) and Hearst Corp. (NYSE: HTV ) , the group invested a reported $100 million in a bid to allow the venture to accelerate its deployment of the emerging technology beyond the small offerings it has in Maryland and Hawaii.
Internet access over power lines is one of a handful of broadband access technologies competing for critical mass. WiMax, the successor to WiFi and dubbed "broadband on steroids," has gotten most of the attention these days, particularly with Intel (Nasdaq: INTC ) releasing its Rosedale chip, which supports the technology. Like BPL, it's also been slow in development despite years of promise. Another possibility for bringing broadband to rural areas is the concept of floating suborbital, lighter-than-air dirigibles called "stratellites" to broadcast signals over hundreds of square miles. A prototype has been built by tiny GlobeTel, but actual deployment is still years away.
Most analysts think Google made this investment simply to continue expanding broadband access. The more people getting onto the Internet, the more likely they'll find uses for Google's varied services.
Power line broadband access transmits radio frequency signals over low- and medium-voltage power lines. Communication networks over power lines have been contemplated since the 1950s, but early BPL equipment created interference with emergency and ham radios. However, the FCC established regulations last year to limit that interference, and the newest technology automatically adjusts power levels to reduce the potential for its occurrence. Access would be possible simply by plugging a special adapter into a typical household electrical socket. Whether BPL will actually emerge as the third alternative to DSL and cable hinges a lot on whether the utility companies themselves invest in it.
A number of utilities are looking at possible investments, including Duke Energy (NYSE: DUK ) and Consolidated Edison (NYSE: ED ) , both of which have teamed up with ISPs such as EarthLink to provide access to high-speed data services in limited amounts. That's good news for the ISPs, which lost the high-profile Brand-X case before the Supreme Court last month as they attempted to force cable operators to open their networks. They'll need to find new partnerships to offer their services; IBM just announced a joint effort with CenterPointEnergy in Houston to test and develop the technology.
As more large corporations invest in broadband over power lines, more consumers searching for an alternative will be able to find one.