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Wireless Broadband in Gas Lines, Natural or Needless?

Channel Partners

July 1, 2005

7 Min Read
Wireless Broadband in Gas Lines, Natural or Needless?

Imagine watching TV and checking out the Major League Baseball scores on the Web over the same lines responsible for keeping you warm in the winter.

A California startup says it has developed a technology that could deliver HDTV and other advanced broadband services over the natural gas lines of which there are 63 million serving residences in the United States, according to the American Gas Association.

Patrick Nunally, chairman and CEO of Nethercomm Corp., aims to partner with broadband providers to deliver such services as highspeed Internet access and high-definition TV through the natural gas lines using wireless technology.

The broadband-in-gas technology developed by Nethercomm Corp. makes use of the unregulated spectrum available in natural gas pipelines. It is “not a miracle of science,” says Nethercomm Chairman and CEO Patrick Nunally.

The Gas Technology Institute, a research organization that has been briefed by Nethercomm, planned to gauge the interest of its member gas companies. “The physics make sense to me,” says Chris Ziolkowski, a research and development manager of electronics with the Gas Technology Institute. “Propagating a radio signal inside a gas pipe is not an impossibility. It’s already been done.”

In fact, Carnegie Mellon University researchers led by scientist Hagen Schempf designed a robot to explore underground gas mains and communicate with a remote operator through a wireless connection.

“From what I see, they are going in the right direction,” Ziolkowski says of Nethercomm.

The question is whether Nethercomm is too late to the broadband game. Parks Associates, a Dallas-based market research and consulting firm, predicts that 40 million homes in the United States will subscribe to broadband service at the end of the year, up from an estimated 33 million at the end of 2004.

There are still homes in the country where high-speed Internet service is not available. Subscribers to high-speed services were reported in 94 percent of the nation’s ZIP codes as of June 2004, according to FCC data. That means 6 percent of ZIP codes did not report any broadband customers, although the FCC said its analysis indicated that 99 percent of the population resides in areas where high-speed subscribers were reported.

However, the FCC data has been subject to criticism since the agency considers broadband service available in a ZIP code even if there is only one customer.

Parks Associates estimates that 10 percent to 15 percent of homes in the United States can’t receive broadband while the Yankee Group estimates that 13 million homes, or 12 percent of residences, don’t have an option for high-speed Internet access. President Bush has said the country must have universal affordable access to broadband technology by 2007.

Nethercomm is planning to arrange a pilot next summer passing approximately 1,000 homes. Nunally says Nethercomm is seeking to link up to a broadband network owned by a cable operator or phone company.

If multiple service providers wanted to deliver TV and other services to a home, Nunally says the broadband-in-gas technology could accommodate that. “We’ve got the bandwidth to service many people and many companies,” he says.

Nunally says Nethercomm is seeking to assure the gas companies they will not be responsible for delivering broadband access. Nethercomm aims to partner with broadband providers. Teaming up with the communications providers could be tricky, however. Cable companies have invested tens of billions of dollars in their infrastructures, and the regional phone companies are spending billions to construct fiber networks to deliver TV and other advanced services.

“We’ve had talks with them all,” Nunally says of the broadband providers, declining to name specific companies. “I don’t think they know, as yet, whether we’re the good guys or the bad guys from the standpoint of their business model.”

Some Internet providers like America Online Inc. (AOL) and Earthlink Inc. may have a greater incentive to support nascent broadband technologies than the phone and cable operators because these companies do not own home networks. AOL and Earthlink did not immediately respond to a request for comment on this story.

Internet providers like AOL and Earthlink are “chomping at the bit” to partner with utilities, said Patrick Leary, assistant vice president of marketing with Alvarion Ltd., a wireless broadband equipment maker, during a speech in May about broadband service over the power lines.

At the United Telecom Council annual conference in Long Beach, Calif., Leary encouraged utilities to join a group promoting a wireless broadband technology that has been in development for a few years: WiMAX. “There’s a key missing element to this group and that’s you folks,” Leary said, referring to the WiMAX Forum.

Matt Davis, director of broadband access technologies with the Yankee Group, says a new technology like broadband over the gas lines would be several years behind the maturation of other broadband technologies. Meanwhile, he says powerful technology giants like Intel Corp. are backing such high-speed wireless technologies as WiMAX.

“Just the fact you can do something technically doesn’t necessarily map to any kind of business case,” Davis says.

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Nethercomm contends its use of ultra-wideband signals inside a buried pipe offers an unlimited private spectrum and will deliver far more bandwidth to the home than fiber-optic technology at a lower cost.

Broadband-in-gas is not the first broadband technology to promise great things. In recent years, state and federal regulators have expressed optimism that power companies could deliver broadband service over the electric grid, providing alternatives to DSL and cable-modem and extending into rural America.

Although some power companies like Cincinnati-based Cinergy Corp. have started marketing broadband service over power lines, many other utilities are still assessing the technology and have not moved as quickly as some regulators had hoped.

In February, a task force with the National Association of Regulatory Utility Commissioners issued a report on BPL that exposed its limitations. “The potential for use of BPL technology in rural areas is often misunderstood,” task force member Julie Parsley, a commissioner with the Public Utility Commission of Texas, said in a press statement issued in February. “BPL configurations that are currently in use are well-suited for efficiently distributing a broadband service to clusters of homes, but not for carrying broadband service long distances or in very sparsely populated areas.”

Parks Associates Senior Analyst Michael Cai says some Internet providers are using proprietary wireless technology to reach homes where wired broadband access has not been available. “Right now, I think broadband wireless is really kind of positioned to” support underserved markets, he says.

In markets where there are high-speed alternatives, Cai says it may be too late to compete with service providers that have years of experience. The big phone and cable companies are adding Internet phone calling and video over broadband lines. “I think certainly for competitive markets a third pipe can be too late unless it’s fiber,” he says.

Says Edwin Rosenberg, senior institute economist with the National Regulatory Research Institute: “There is some question about how many broadband pipes are we really going to need.”

Ziolkowski says California-based Sempra Energy contacted him this year about Nethercomm. Ed Van Herik, a spokesman for Sempra’s Southern California Gas Co., the largest natural gas distribution company in the nation, and San Diego Gas & Electric, says the company does not comment on whether it is in talks with a particular vendor.

In 2003, California regulators approved a plan that allowed telecommunications and cable operators to install their lines in gas pipelines operated by Southern California Gas and San Diego Gas & Electric. However, no cable TV or phone companies ever installed their lines within the gas networks.

For now, Sempra is gearing up to test broadband service over the power lines. “It’s really an attempt to test the technology on our system,” Van Herik says.


Alvarion Ltd. www.alvarion.com
American Gas Association www.aga.org
America Online Inc. www.aol.com
Carnegie Mellon University www.cmu.edu
Cinergy Corp. www.cinergy.com
Earthlink Inc. www.earthlink.com
FCC www.fcc.gov
Gas Technology Institute www.gastechnology.org
Intel Corp. www.intel.com
National Regulatory Research Institute www.nrri.ohio-state.edu
Nethercomm Corp. www.nethercomm.com
Parks Associates www.parksassociates.com
Public Utility Commission of Texas www.puc.state.tx.us
Sempra Energy www.sempra.com
United Telecom Council www.utc.org
Yankee Group Research Inc. www.yankeegroup.com

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