Powerline Communications

Industry Overview

However, the companies who provide Internet services have not been carrying on as usual. They realize that users of the Internet are hungry for faster service than phone lines and 56k modems currently provide. Additionally, many Internet service companies seek to increase their profitability by offering Internet access, local phone calls, cable TV, and perhaps long distance phone services to their customers in one relatively inexpensive package. The solution is a high bandwidth network with links to each customer’s location. Implementing this type of network has not proven to be easy.

Telephone companies have offered high bandwidth lines for many years. For the most part, the cost of these lines and the equipment needed to access them has limited their usefulness to large businesses. The lone exception has been ISDN (Integrated Services Digital Network) which has won over some residential customers. ISDN offers fast Internet access (128k) at a relatively low cost.

Telephone companies have begun to replace the phone lines that connect residences and business to the standard telephone network with higher bandwidth lines. However, this process is costly and time consuming. Such higher bandwidth networks won’t be operational for several years.

Cable television companies have also jumped into the Internet access market. The lines that carry cable television are much faster (1500k) than standard phone lines or even ISDN. The major problem with cable TV’s attempts at providing Internet access has been the unidirectional character of cable TV lines. Cable TV lines are only designed to bring information to the customer, not to get input from the customer. This fundamental flaw in cable TV lines has increased the costs of developing Internet access services based on them. Thus, most cable TV Internet access systems will not be ready for several years. (Currently, Internet access over cable TV lines is available, but a phone line handles messages from customers to the Internet.)

Wireless solutions have also been proposed, but have run into problems. First, the performance and reliability of wireless solutions has not been up to the level of any of the wire-line solutions described so far. Second, the ability to send data from a customer to the Internet requires much more equipment than simply receiving data. This additional equipment makes wireless Internet access much more expensive than wireless cable TV.