If you think your modem gets "warm" now:
Northern Telecom to Unveil New Technology Tomorrow (Update1)
London, Oct. 7 (Bloomberg) -- Northern Telecom Ltd. and
United Utilities Plc said they plan to unveil new technology
tomorrow that will allow electrical utilities to offer phone
and Internet-access service over electric wiring.
The technology, which can carry voice, video and other data
over common wiring and was tested in 20 U.K. homes over the past
year, will be detailed at a London news conference.
If proven commercially viable, such technology may pose a
threat to telephone companies already dealing with competition
from cable television and wireless companies. It will also allow
new telephone-industry rivals to lease capacity from utilities
rather than build their own networks or purchase capacity from
established phone companies.
''It's one thing to say you have the technology; it's
another thing to deliver it,'' said Ian Angus, president of
consultants Angus Telemanagement Group Inc. in Ajax, Ontario. He
said the technology appears to be an improvement rather than
an innovation because power lines were used to provide telephone
service in the rural U.S. in the 1940s.
Large Utilities Interested
Still, Hydro Quebec said it's intrigued by the technology as
a way to benefit further from the large investments its already
made.
''We knew it was possible to transport information over our
wires but the problem is that we can't send too much information
and we've had a problem with video,'' said Hydro Quebec spokesman
Steve Flanagan. ''We're very interested in the technology.''
Hydro Quebec is already exploring ways to get into the
communications industry. After building an internal fiber optics
system across Quebec, Flanagan said the utility is trying to find
a partner to develop a wholesale business that would offer
information transmission services.
Ontario Hydro, North America's largest utility, has held
discussions about power-line technology with Northern Telecom
and other equipment makers, said spokesman Al Manchee.
''The principle itself isn't new but the problem is they
haven't been able to develop a high-speed technology yet so we'll
see what Nortel will unveil,'' Manchee said.
For Internet access carriers, the technology being proposed
by Toronto-based Northern Telecom and United Utilities is
intriguing because it would offer yet another vehicle for them to
deliver their services.
''These guys have an asset and they are trying to get a
better return on it,'' said Ron Close, president of Netcom
Canada, Canada's fourth-largest access provider. ''It's the same
being done by cable companies and telephone companies.''
With the rapid growth of the Internet and high-capacity
products like video hitting the market, Close said network
capacity is a huge issue and the more providers the better.
Although the cable television industry has been touting its
ability to offer high-speed Internet service for the past few
years, its yet to become widespread. Rogers Communications Inc.
and Time Warner Inc., for example, offer Internet access on a
limited basis.
Northern Telecom shares rose C$5 to C$153.75 in
Toronto after earlier reaching a record high of C$154.50. United
Utilities dropped 7.5 to close at 753.5 pence in London.
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