Google invests in powerline Internet firm
Reuters - Thursday, July 7, 2005; 3:09 PM
NEW YORK (Reuters) - A company that provides high-speed Internet access over electrical power lines on Thursday said it has received a major investment from Google Inc. <GOOG.O>, the Hearst Corp. and Goldman Sachs <GS.N>.
Current Communications Group said it would use the financing to accelerate its deployment of voice, video and data services in domestic and global markets. The company declined to disclose financial terms of the investment though the Wall Street Journal reported that it approached $100 million.
Current's service is available primarily in Cincinnati, Ohio, through a partnership with Cinergy Corp. <CIN.N>, with smaller deployments in Maryland and Hawaii.
"Clearly the technology is ready to be pushed into new markets and we are spending a great deal of our time trying to do that," said Scott Bruce, managing director of Current and its major backer, Liberty Associated Partners. "It's already commercial and ready for prime time."
Internet access over power lines is seen as a way to deliver broadband service to rural areas where telephone and cable lines do not reach, or where various forms of wireless access are too expensive or not yet in place.
There is even a standards body, the HomePlug Powerline Alliance, with specifications for data transfer within the home and from external sources to the home over electrical lines. It counts Sony Corp. <6758.T> and Comcast Corp. <CMCSA.O> among its most prominent members.
The technology has not gained significant traction yet among consumers, though, as it is not widely offered. Other technologies like the wireless WiMax standard have received more attention as a way to get the Internet to distant places.
But Bruce said Google's investment in Germantown, Maryland-based Current fit right in with the Internet search giant's philosophy of spreading Internet access.
"Our attraction for having a relationship with Google is sort of obvious. They're interested in the proliferation of broadband generally," he said.
Google said in a statement it was "very excited to have a relationship with Current Communications Group to help promote better access to the Internet."
The company already has a number of deals with broadband providers for various content and search services, Comcast among them.
A top Hearst executive said the investment fit in with the media company's distribution strategy.
"We have an interest in delivering our content through the widest possible pipes," said Ken Bronfin, president of interactive media for Hearst. "The idea of creating another delivery mechanism to the home, especially in underserved areas, is attractive."
A spokesman for Goldman Sachs confirmed the investment but declined further comment.
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