IBM takes another stab at dying powerline market

IBM this week made yet another play in broadband over powerline (BPL) technology, signing a deal for a system targeted to rural areas in the eastern US. But meanwhile, the overall powerline market seems to be fading away.

In a move to bring broadband services to consumers in rural America, IBM this week inked a $9.6 million agreement to install broadband over powerline (BPL) technology at electric cooperatives throughout the eastern part of the US. Meanwhile, many consumers, even in rural areas, have already turned to other broadband technologies.

IBM has pushed for similar systems in the past, helping to establish a powerline network in the city of Houston, Texas in 2005, for example.

Praised by advocates for its affordability, BPL technology uses a combination of large utility power lines and standard electrical writing in and around the house.

But despite a flurry of renewed activity over the past year or so, BPL looks like a technology which might have missed the mark just about entirely in terms of timing.

At CES 2008, for example, members of the HomePlug Power Alliance and HomePlugAV camps of the powerline industry each talked up their wares, as did European-based Digital on Silicon (DS2), which sells powerline home networking chips into the US market through equipment from Netgear.

Five months later, however, a long touted BPL trial in Dallas being run by DirecTV and Current Communications was sold to the local utility, which then started using its infrastructure for smart-electrical grid monitoring instead of the originally planned broadband access for consumers.

Powerline technology is still plagued by electrical interference issues. Moreover, depending on where consumers live, a lot of them have already adopted options such as cable, satellite, and 3G wireless technologies like EV-DO. Meanwhile, Verizon's FiOS and AT&T's U-verse are increasing their penetration, and 4G WiMAX is on the way.

"I don't think BPL will every come anywhere near the speeds offered by FiOS or cable," predicted Chris Roden, an analyst at Parks Associates, during an earlier interview with BetaNews.