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Issue of August 2002 
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Focus: Power Grid Access
Powerline communications

There is now a whole new way to connect to the Internet and to network computers in a LAN, by using the world's largest existing network-the power grid. by oo Gin Lee

PLC uses the existing electrical wirings hidden in the walls of homes and buildings, users can do away with messy cables and do not need to open floorboards, hack walls and break ceilings to run the wires Powerline communications (PLC) may soon be a viable alternative to DSL and cable for last mile connectivity, and as power grids already cover 95 percent of the world, it also offers better penetration. PLC makes use of existing low-voltage electrical cables to transmit data and voice signals, and allows services such as LAN, broadband Internet access, telephony, and fax.

For utility suppliers, PLC opens a whole new revenue stream for them which they can deploy quickly. For service providers buying wholesale services from utility companies, PLC also offer various benefits, including the speed and cost of deployment and the ability to break the telco monopoly on last-mile access in many countries.

How it works

The technology behind PLC is not exactly new. For decades, sending data over the very same cables that carry electricity has been used in limited applications like controlling street-lamps

Initial efforts by Siemens AG and Nortel Networks to offer Internet access through the electrical outlets ended up in abject failure. Frustrated by technical problems, the two companies threw in the towel in 1999 and 2001 respectively, claiming that powerline Net access did not have the potential.

But technological advancements over the last few years have overcome the technical issues, most notably that of line noise or interference from electrical devices plugged into the same electricity grid, which can disrupt data-transmission.

PLC works by transmitting data signals through the same power cables that transmit electricity, but it uses a different frequency. To do this, every PC needs to be attached with a PLC adaptor, which also functions as a modem.

To PLC-enable its power grid, the utility company has to install an outdoor master device at the power substation. The Internet backbone using fibre or other traditional technologies is then connected to this outdoor master.

The outdoor master acts as an administrator for the outdoor systems and as a gateway to connect the PLC system with the backbone network. The outdoor master is in turn connected to one or more access points. The access points connect the indoor to the outdoor systems. Externally, it acts as a slave device to the outdoor master but internally it administers the PCs connected using the PLC adaptor.

Powerline around the world
There are currently two main technology providers Switzerland's Ascom and Israel's PLC. Between them, they have helped to start PLC services in many countries including Germany, Sweden, Singapore and even the remote ski-resort cities in the Austrian Tyrolean mountains. In Singapore, the incumbent utility company Singapore Power (SP) started technical trials last November, using a test-site at the Singapore Polytechnic. Initial speeds of 800 Kbps and later 2.25 Mbps were achieved.

Then in April this year, SP announced it was working with two local service providers Pacific Internet and Little Green Apples (LGA) to roll-out commercial trials of the Internet access via power-socket technology which could now reach 45 Mbps. The "test-sites" involved about 500 users from a school, commercial buildings and homes. Commercial services are expected to be launched late 2002 or early 2003.

Technology pros and cons
Current PLC technology has reached a maximum speed of 45 Mbps. This is divided into a maximum 27 Mbps for downstream speeds and 18 Mbps for upstream speeds. In Singapore, PLC will have the highest access speeds, compared to ADSL clocking in at 512 Kbps and cable at 1.5 Mbps.

However, as PLC is a point-to-multipoint technology, the 45 Mbps needs to be shared by users in a building or within an area. Basically, 45 Mbps is the bandwidth for one substation. PLC's significantly higher upload and download speeds make it suitable for a variety of two-way applications like peer-to-peer networking, file-sharing over the Internet, and interactive distributed online services like games and Web-cams.

Because PLC uses the existing electrical wirings hidden in the walls of homes and buildings, users can do away with messy cables and do not need to open floorboards, hack walls and break ceilings to run the wires. PLC also enables indoor networking for PCs and printers, plus shared Internet access between PCs in an office or home.

In addition, PLC boasts a superior distance of 300m (without using repeaters) compared to 100m for standard Fast-Ethernet and about 50m for 802.11b wireless connections.

However, there are potential security issues because a single power line from the utility company goes to multiple homes and office buildings. This means that hackers can "listen in" on the shared bandwidth. But according to RWE Powerline, a service provider that has rolled out commercial PLC services in Germany, security is not an issue. Its website says that PLC is harder to tap than GSM mobile phones.

Viability to utility company
For utility companies, PLC opens up a new revenue stream at minimal or moderate risk.

Explaining SP's decision to use PLC technology, its President Rear-Admiral (Ret) Kwek Siew Jin, said: "PLC involves expanding the use of existing energy infrastructure for transferring information. Since SP is already transporting electricity through its networks, it is thus synergistic to leverage on SP's core assets and spur the use of this technology."

For utility companies, there are three business models:

  • The wholesale model where the utility company provides the last-mile infrastructure to ISPs, like what SP is doing
  • The data only model where the utility company acts as the ISP for data services
  • The full ISP model where the utility company acts as ISP for voice and data services

According to a white paper by Ascom, the wholesale model offers a very safe investment with an expected ROI of between 5-10 percent. The second model offers an attractive investment at a moderate risk, with ROI ranging between 10-15 percent. And the full ISP model offers a very attractive investment with moderate risk, with the ROI at 15-20 percent.

In Singapore, SP is using the wholesale model, providing the back-end last-mile infrastructure access while ISPs Pacific Internet and LGA interface with end-users.

Viability to service providers
For Pacific Internet, SP's entry into the Internet access business means that it can be less reliant on rivals SingTel and StarHub, both of which own their own last-mile infrastructure by way of telephone lines for the former and telephone lines and cable for the latter.

Sui Wee Chong, Senior VP, consumer and corporate (sales & marketing), Pacific Internet Singapore, said that this will allow the company to be a broadband provider of choice to customers, and to recommend the best solution that suits their needs.

Yew Hock Meng, Chief Marketing Officer of LGA, said that PLC lets his company deploy Internet access solutions faster and cheaper to LGA's customers.

"In the past, you needed technicians to do wiring and connections. Now we can just deliver pre-configured PLC modems and users can just plug-and-play," said Yew.

He added that cost-savings come from taking away the need for pulling messy Ethernet wires, plus saving the cost of patching telephone lines every time a new household or office apply for Internet access.

But he does not expect PLC to replace the other existing technologies like DSL and Wi-Fi as they are complementary.

Powerline networking
PLC technologies can also be used to network computers for file and printer sharing, or sharing cable or ADSL Internet access among computers in a Powerline network much like an Ethernet LAN.

All the users need is a sandwich-sized adaptor for every PC that needs to be connected. One end of the adaptor goes into the Ethernet or USB port of the PC while the other plugs into the mains socket.

To share Internet access, a powerline bridge needs to be connected to the router. One end of the bridge is connected via Cat-5 cable into the uplink port of the router, while the other end goes into the power socket.

Several vendors have released or are soon releasing these powerline networking products, including LinkSys, Gigafast, SMC and NetGear.

LinkSys will also be releasing a powerline router (which has Ethernet ports) soon, which removes the need to connect a second device (the powerline bridge) to the router.

According to LinkSys, the cost of the powerline adaptors (Ethernet or USB) is about US$180 while the upcoming router will be about US$200.

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Copyright 2001: Indian Express Group (Mumbai, India). All rights reserved throughout the world. This entire site is compiled in Mumbai by The Business Publications Division of the Indian Express Group of Newspapers. Site managed by BPD