May 4, 2006 9:21 AM PDT
EarthLink, GE fund broadband over power line provider
Current is already offering broadband over power line service to consumers in Cincinnati, and will soon offer a similar service in Texas. Previous investors in the company include Google and the Goldman Sachs Group.
For years, people have hoped broadband over power line technology, or BPL, would allow power companies to become the third alternative in the broadband market, competing against cable operators and telephone companies. But technical limitations and interference issues with local emergency radios and short-wave HAM radios have stood in the way of mass adoption.
In recent years, new modulation techniques supported by other technological advances have helped BPL evolve. Most services today are capable of delivering between 512Kbps and 3Mbps of throughput, which is comparable to most DSL offerings.
It's little surprise that companies such as Google and EarthLink are interested in BPL. EarthLink, which doesn't own any of its own DSL or cable infrastructure, is determined to find new ways to reach customers without depending on the cable and telephone companies to provide access.
As a result, the company has been building citywide Wi-Fi networks around the country. It has also conducted BPL trials and experiments with several power companies including Duke Power in Charlotte, N.C., Progress Energy in Raleigh, N.C., and Consolidated Edison in New York.
In addition to investing in Current, EarthLink will also serve as a retail provider of its broadband service.
"Current BPL gives us another viable alternative to the broadband services we now provide," Garry Betty, EarthLink's chief executive, said in a statement.
While Google doesn't compete directly against phone or cable companies today, it might in the future as it rolls out video and voice services. Finding alternative access to consumers could also become important for Google as phone companies threaten to eliminate Net neutrality principles. Phone companies say they may want to charge extra fees for delivering certain content, such as video, over their broadband networks.
Google has already built a long-haul fiber network to connect its data centers, essentially eliminating the need in some parts of the country to buy those links from telephone companies. Like EarthLink, Google is also getting into the citywide Wi-Fi business. In fact, the two companies are partnering to provide Wi-Fi to the city of San Francisco.
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