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Business & Finance | Jun 28, 2004

PowerLine Tech For Internet - Trials In Ghana

Balancing Act

POWERLINE TECHNOLOGIES FOR INTERNET AND VOICE ACCESS - AFRICAN TRIALS UNDER WAY The idea of sending data down electrical power cables - called powerline technologies - has been around for some time but has nearly always received a mixed press. Keeping data and power from interfering with each other on a consistent basis has been a challenge that never quite seemed to be overcome. Nevertheless there are now a number of developed world companies who are going from tests to commercial services. Tests are now beginning to take place in Africa where - if the technology delivers according to its claims - it could considerably lower the costs of network roll-out. Russell Southwood talks to Andrew Boye of Intell Solutions who will be trialling the technology with the Electricity Corporation of Ghana. Will it work? Judge for yourself.

How has the project developed?

We've been working on it for the last five years and it's evolved through several different stages. We're trying to use electricity infrastructure to the home to transmit data and voice. Nortel created a consortium technology to tackle it and 5-6 years ago it was claiming that it could deliver 1 mbps. But it was not able to translate its research trials into a commercial application.

However now this kind of work is resulting in commercial applications that are being tested. (For a list of current tests being conducted see table at the end of this article.) We stayed in touch with these industrial developments and made a partnership with DS2 (www.ds2.es) It had come up with a chip to do the conversion and that has transformed the possibilities of the technology. It claims to be able to deliver 45 mbps with its 3.3X version and 200 mbps with its version four. There are others around who are offering anything between 4-8 mbps. It's estimated that by next year two utility companies in Spain will come into commercial deployment with the technology and that there will be a projected 120,000 "boxes" by next year. One of our partners EBA is deploying in Latin America.

Here in the UK it's an optional technology because there are other technologies that are more mature. However even with those technologies there are cost implications: fibre and adsl are expensive. So if we can use the ubiquity of the electricity networks, we can address these cost issues.

Many people will read this and think how can this work of Africa's power infrastructure which is often in poor shape and usually suffers from power cuts?

All that's happening is that electricity and communications are sharing the same pipe. They're independent of each other: the transmission of signal is independent of electricity. The high-speed modem needed has a back-up power system.

It's a leapfrogging technology. You can go from having the PSTN in its current state to having a first class network. In Ghana there is 70-80% electricity network availability. It can effectively complement the current network or act as a viable alternative. Ghana Telecom could use it to improve service to existing clients or to increase its coverage footprint. Voltacom has 600 kms of fibre and it could use the technology to strengthen its position. It also has an automated metre reading system which would offer large savings for any power utility.

So how does it work?

We offer the last mile and the last inch. The signal goes from the hi-voltage cables to a medium voltage sub-station. From there it goes on to 50 low voltage sub-stations which can each service between 100-150 homes. We have to bring together fibre or copper backbone with medium-voltage sub-stations. With the way powerline technologies work, Ghana Telecom can provide regional connections. You could also use satellite as a backbone option. Secondary schools could be hooked up at little or no cost. The total investment for a national network in Ghana would be USD20 million.

Signal strength is based on ethernet principles and uses a modem and a repeater.

How would the service be charged and who would the customer deal with? The power company?

We will own the customer. If one customer of ours calls another also on our system, all the revenue would come to us. Otherwise we'd reach interconnect agreements on the normal splitting ratios. Like broadband, it's an always-on service so we could have a floating rate based on levels of use or a metred service.

So where's the trial going to take place?

Ghana is the pilot. Doing business if Africa is difficult and we're in the process of raising funds to carry out the pilot. The investors we're talking to want us to trial the technology on an African network.

The first phase would cost USD100,000 to demonstrate to the Electricity Commission of Ghana that the technology actually works. It put out a tender asking for expressions of interest and 18 companies expressed interest. Two were shortlisted, ourselves and a company called I-Level that was taken over by Schneider. We were both offering the same technology and it had been used in Sweden.

We are working directly with EBS and DS2 and we want to provide an end-to-end solution. Our partners want us to sell their boxes and they need to have a group of people who have telecoms skills.

What we're saying to the Electricity Commission of Ghana is that we'll operate the network and you can share in the returms through a joint venture. It would be a public limited company, 100% owned by the Government.

So where's the money going to come from for the roll-out?

We're looking to institutional investors and getting it to the point where we can evaluate the business model. I-Level has had some technical issues but we could both do it simultaneously with different parts of the network. We're looking to do the trials in the second half of this year and have commercial deployments by next year.

There's also a small-scale trial taking place in South Africa to evaluate the technology.

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