Is This the Year for Broadband over Powerlines?

This is the year when everybody in America will have broadband service — that is, if government policymakers and the marketplace keep pace with the universal broadband goal set by President Bush.

When the President announced that goal in a June 2004 speech, he focused special attention on broadband over powerlines (BPL), saying that, since powerlines go everywhere, they provide a “great opportunity to spread broadband throughout America.”

BPL has long been a promising technology that has never quite turned the corner. But the FCC has taken some aggressive actions aimed at spurring BPL deployment and turning BPL into a viable competitor against DSL and cable modems in broadband markets. Bringing a third competitor into the broadband field would be great news for consumers, and would also benefit VoIP service providers who, for example, would have the opportunity to partner with electric utilities to use BPL as a pipe for mass market delivery of VoIP.

BPL involves an overlay of equipment, software, and management services folded into the electric grid without altering physical electrical paths. A number of features make BPL a potentially attractive competitor. It supports “triple play” services (VoIP, high-speed Internet access, and video on demand) and other broadband services over existing powerlines. And BPL doesn’t require any additional wiring at customer premises. Users can access the Internet and broadband services simply by plugging into any electrical outlet.

BPL runs as an Internet Protocol network, making the BPL systems robust, scalable, and flexible. IP makes the configuration of BPL networks easier, and bypasses expenses for large head-end or central office facilities. BPL currently provides end user speeds of between 1 Mbps and 4 Mbps (for both downloads and uploads), with some deployments reaching speeds up to 10 Mbps.

So — Why hasn’t BPL taken off? And what has the FCC been doing to try to jump start the technology? BPL has grappled with two main problems — solving interference with licensed spectrum users, and working out an economically feasible business plan.

Electric lines used for broadband, it turns out, act as huge antennas, because of their length and their height above ground. The lines radiate radio frequency energy over the airwaves, causing potential interference to licensed spectrum users at considerable distances.

The FCC acted three years ago to address interference issues by adopting operational and technical requirements for BPL aimed at avoiding harmful interference and resolving interference issues when they do occur. The requirements, which were affirmed by the FCC in an action taken last year, also include emission limits for BPL equipment. The FCC’s actions have been viewed as a shot in the arm for BPL entrepreneurs, largely because the FCC concluded that its rules adequately protect licensed spectrum users from harmful interference. In addition, companies like Motorola have been designing BPL delivery systems that substantially reduce interference, and the American Radio Relay League has been working with utilities, equipment manufacturers, and regulators to address interference issues through cooperative problem- solving efforts.

The other problem has been coming up with a winning business plan. Several factors make it difficult for BPL to gain a foothold in the broadband market. The entrenched incumbent cable and telephone companies have a very strong market presence. Electric utilities lack expertise in running consumer telecommunications businesses, and the utilities have not often been inclined to embrace and invest in new technologies like BPL. So far, comprehensive, uniform standards and protocols have not been established for BPL systems. And, even though BPL makes use of existing infrastructure at customer premises, electric utilities still face equipment and labor costs in order to deploy BPL systems.

But the picture may be getting brighter. The FCC adopted an Order in November 2006 classifying BPL as an interstate information service, rather than as a telecommunications service. This mirrors an action the FCC had taken in 2005 classifying DSL the same way, following a U.S. Supreme Court decision upholding an FCC ruling that cable modem services should be treated as information services. Information services are subject to less regulation than telecommunications services, so the FCC’s action makes it easier for BPL to compete with DSL and cable modems in broadband markets. FCC Chairman Kevin Martin noted that classifying BPL as an information service will help foster the development of BPL and promote broadband competition, saying that “[b]y encouraging the development of new technologies, such as BPL, we can best achieve the President’s goal of universal broadband by the end of 2007.”

In addition, electric utilities are looking at approaches that would use broadband not only for Internet access and IP-based services, but also for “intelligent grid” applications like automatic meter reading, faster identification of electrical problems, and automatic distribution switching, which facilitates power restoration. The utilities are also considering partnering with companies having expertise in delivering consumer telecommunications products and services. This approach can involve a “landlord” model, where the utility rents the grid to an outside party for a percentage of profits the outside party obtains by providing BPL over the grid, or a “joint venture” approach, where the utility is more directly involved with Internet service providers in providing BPL.

The FCC deserves credit for trying to advance the prospects for BPL. As Chairman Martin has said, BPL “hold[s] great promise as a ubiquitous broadband solution that would offer a viable alternative to cable [and] digital subscriber line . . . .” And maybe 2007 will prove to be the year in which consumers, along with VoIP providers and other IP-based service providers, begin to reap the benefits of BPL in the broadband marketplace.

John Cimko served for 15 years at the FCC, and currently practices law at Greenberg Traurig LLP. He can be reached at [email protected]. The views expressed in this article are solely those of the author and should not be attributed to his firm or its clients. Greenberg Traurig is an international, full-service law firm with more than 1,200 attorneys and governmental professionals in 24 offices in the United States and Europe. For additional information, visit the firm’s website at http://www.gtlaw.com.

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