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Gridline in the News January 11, 2007
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Thursday, January 11, 2007
Startup That Delivers Broadband on Normal Power Lines Moves to the City
By Richard Metcalf
Journal Staff Writer; Copyright © 2007 Albuquerque Journal
A startup company, poised for growth offering broadband data services delivered via power lines, has made Albuquerque its headquarters.
Gridline Communications, after 2 1/2 years based outside Houston, has taken 11,550 square feet in the Science & Technology Park at University of New Mexico.
"Right now, we've got 11 people with the company," said president and chief technology officer Terry Dillon. "By the end of '07, we should be somewhere between 40 and 45."
Most of the company's new jobs will pay from $50,000 to $100,000 a year and be filled by local hires, he said.
The basic technology behind broadband over power lines, or BPL, has been around since the 1970s. The technology was initially used by electric utilities to manage their power grid.
The Internet explosion has cast the technology in a new light.
In simple terms, it can deliver high-speed Internet through electrical wires— instead of a TV cable or phone wires— to homes and businesses, connecting to your computer via modem from an electrical outlet.
"It's using infrastructure that's in place in 85 percent of the world for delivering high-speed broadband access and information," Dillon said. "Only about 40 percent of the world has access to telecommunications."
BPL's potential in remote and rural areas of Central and South America attracted the attention of the Ibero American Science & Technology Education Consortium, launched in 1990 and headquartered at UNM.
The consortium asked Dillon to speak on BPL at a membership assembly in late 2005 in Loja, Ecuador. The response at the assembly was overwhelmingly positive, Dillon said, and led to meetings with UNM's economic development office.
"I was astounded at the value UNM brought to Gridline and the things we needed to do," Dillon said.
By locating in Albuquerque, he said, the company has access to electrical engineering and computer labs at UNM. Plus the company can find engineering students to work on short-term projects.
"I don't have to hire a full-time engineer today to do a three-month project," he said about the role of students. "And it gives them a work-study program. They have been a huge asset."
As for its office space on the second floor of the new University Press building, Gridline lucked out.
"We don't have much vacancy in the park— ever," said Connie Vance of UNM's property management office. A potential tenant was negotiating for the space available in the University Press building when Gridline came along.
"That didn't work out," Vance said. "For Gridline, that was fortuitous."
The company was seeking an office in the airport submarket because of its closeness to UNM and Albuquerque International Sunport, said Barbara Haase of Cauwels & Stuve Realty and Development.
In addition, Gridline wanted an office with style and class.
"Image was important to them because they have a lot of high-ranking foreign visitors," said Haase, who represented the company in its property search.
As a tech startup with plans for a rollout this year, Dillon said, the privately held company works on a tight budget. He described its investors as high net-worth individuals and "very targeted corporate investors."
Gridline does submit filings to the U.S. Securities and Exchange Commission as a precursor to an initial public offering, or IPO, of stock.
"When we believe it's appropriate and the market is receptive and it makes good business sense, we can do an IPO," Dillon said. "By waiting, we think we'll get a much better valuation for our shareholders."
The broadband-over-power-lines business has seen some tough times. The first commercial trial— the 1999 debut of a municipal system in Manassas, Va.— was a "miserable failure," Dillon said.
The problem was not that data had to sharing power lines with electricity, but competition from established broadband providers and interference with some types of conventional radio frequencies. Ham radio operators were particularly up in arms.
"It's come a long way since then," Dillon said about refinements in BPL technology. "It's not magic, what we're doing. It's just very simple physics and very simple electronics."
Gridline has three BPL systems in place, one in Mexico, one in England and one in a small community in Arizona. A fourth is planned for deployment this year in Loja, Ecuador, as a result of Dillon's address to the Ibero American Science & Technology Education Consortium.
Gridline has teamed with Albuquerque-based Aquila Technologies to market its services in New Mexico.
A division of Mele Associates Inc., Aquila is always on the lookout for emerging technologies, said Judy Beckes Talcott, vice president of networking. "We've been looking at BPL for quite some time. Their technology promises to be high speed enough and robust enough to be a viable contender, especially in certain niche markets."
The company's customers are likely to include power companies, municipal governments and institutions such as universities. Its systems are unlikely to always be pure BPL, but rather a combination of technologies including fixed wireless telecommunications or fiber-optics.
"There's no real silver bullet for that final delivery," he said.
Gridline will offer a gamut of broadband services for both households and businesses. As a basic Internet service provider, its monthly fee is about $30.
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