A consortium of high-profile tech firms today announced they have picked a technology that will serve as a common way for connecting electronic devices to the Net through electrical outlets.
The HomePlug Powerline Alliance has chosen a technology by a little-known firm called Intellon that will allow consumers to use their homes' internal electrical networks as the medium to share Internet access, play video games, talk on the phone, and enjoy movies and music throughout the house.
"It's about time there's an organization that will promote powerline home networking," Yankee Group analyst Karuna Uppal said. "They picked a technology pretty quickly and have started talking about field trials. That's a good sign, but the problem is proving the technology works in all homes, no matter how many hair dryers you have on at the same time."
The "powerline" alliance, made up of 36 companies including 3Com, Cisco Systems, Hewlett-Packard, Intel, AMD and Radio Shack, represents the latest effort to create networking standards for the home. Two previous coalitions have created standards for wireless and phoneline connections in the home. A phoneline networking kit, for example, allows PCs to network with one another by plugging them into regular phone jacks.
Analysts expect the emerging home networking market to explode in the coming years with a mix of phoneline, wireless and powerline technology.
The Intellon technology was one of six proposals considered by the nonprofit consortium. The HomePlug group will now work to improve the technology and start testing it in homes. It hopes to release a final standard by the end of the year.
At issue is the noise and interference that come with sending data, voice and video over powerlines. Powerline is considered "noisy" because electric signals from appliances can use the same frequencies as data, voice and video.
HomePlug president Alberto Mantovani said Intellon's technology will solve the noise issues and predicts that the technology will work in 98 percent of homes.
Analysts say the decision is a setback for start-up Enikia, which helped create the powerline alliance and had been working on its own technology for more than a year.
"This is a blow to Enikia because they staked their claim on being the high-speed powerline technology," Uppal said. "They lose the chance to become the dominant technology."
By winning, Intellon product marketing manager Elliott Newcombe said the company benefits two ways: It receives small royalty payments from licensees of the technology, and it has a head start in building the chips that will power powerline networking devices.
"Even someone licensing the technology from day 1 will have a learning curve," he said.
But Enikia executives, who say they will support Intellon's technology, disagree.
"We have full access to the technology, so it's not a situation where somebody else's technology comes to market and we have to learn about what it does over time," said Jarek Chylinksi, Enikia's vice president of global marketing.
The powerline technology will feature data transfer speeds at 10 mbps (megabits per second), a rate fast enough to handle music and video downloads. Companies have marketed visions of people turning on a stereo in the living room and sending music to a PC in another room, while a computer in a bedroom could program the video cassette recorder.
Consumers should see products hit store shelves by the first half of 2001, said HomePlug's Mantovani. Initial powerline products will include home networking kits, Internet appliances such as Web pads, and regular home appliances such as Internet radios, he said.
Mantovani said the HomePlug alliance is still discussing the possibility of collaborating with a competing powerline standards effort. Late last year, the Consumer Electronics Association (CEA) formed a group that included Sony and Thomson Consumer Electronics to develop a similar standard.
"We want to work with those guys," he said.