Smartgrid2: We were right about cable modems and BPL is next

Former European cable execs see BPL parallels

Firm poised to ease BPL's entry into Europe

Reproduced from the Jan 30 issue of BPL Today with the permission of the publisher, GHI LLC (+1-202-298-8201, www.bpltoday.com).

Two former vice presidents of reportedly Europe 's largest triple play firm started a BPL integrator/operator called Smartgrid2.

Tom Walsh and Patricia McGrath were executives at UPC Broadband -- now owned by Liberty Global. The Netherlands-based firm grew from a 200-user cable modem trial network in Amsterdam in the mid 90s to a customer base of over 1.5 million cable broadband subscribers in 14 countries in 2002. Walsh was vice president of engineering and then operations and McGrath was vice president of network planning and implementation.

The two left UPC and in 2005 they started Smartgrid2 in Ireland . They looked at various alternative technologies and soon found BPL.Smartgrid2 is convinced BPL is the technology it had been looking for and set its sights on deploying BPL for utility services and retail triple play throughout Europe .

Walsh and McGrath spoke to us Thursday from their headquarters in County Kerry in Southwest Ireland .Walsh is CTO and McGrath is director." Europe will offer incredible opportunity for ‘smart grid' technology players for the next 10 years," said Walsh. He believes the key for BPL technology firms to succeed in Europe will be to maintain a presence without draining resources and funds.

Smartgrid2 ( www.smartgrid2.com ) is set up to help. The firm's been trying to land BPL projects with utilities but like everywhere, European utilities have resisted.

EU's pushing BPL

"Utilities have been slow to come to the table so far -- but here in Europe the EU is actively pushing the technology," said Walsh. Why is the government of Europe pushing BPL?

A BPL initiative is underway to "overcome the energy challenges presented by a rapidly expanding [EU] membership where demand is outstripping supply," Walsh reported. He and McGrath are involved in that government effort and they're confident "it will happen," she added. The firm wants to introduce to Europe some of the main players in the BPL world "that have existing and proven technologies and proven business cases so that we can jump start some technology trials.

"We believe that some of the strongest players have a great opportunity to be in at the beginning" -- with a real possibility to turn those trials into commercial deployments.

Smartgrid2 hopes to avoid "open-ended science experiments -- that I think have been some people's experience in the past," said McGrath. Some of the utilities in the EU are trying to "reinvent the wheel," she added -- and Smartgrid2 wants to show them wheels are "already out there," she added.

The challenge for Smartgrid2 is to make deals with international BPL technology firms including US firms and represent them in Europe .

The name says it all

Smartgrid2 learned early that utilities aren't usually interested in hype about the broadband business. True to its name, the firm is focused on utility applications and sees that market offering huge potential. Commercial broadband is a side benefit that can be delivered by firms that lease bandwidth from the utility, he noted.

But the need for the 21st century smart grid is urgent. The EU grew from 15 to 27 countries in the last 3 years, Walsh reminded. Many have rapidly growing economies that are putting incredible demand on power grids.

These states have limited raw resources for energy production and a lack of organization in the power interconnection between countries. The EU doesn't have a system to manage the grid or know "who's producing power" and who's using it.

"Smart grid efficiency and control are finally being seen as the way to integrate and manage the various networks" -- and cut reliance on generators outside the Union , said Walsh.

Meanwhile less developed nations in the EU are trying to build their economies and getting access to broadband is a key ingredient. "Pilot projects are being planned to take the best existing solutions and test them for commercial roll-outs throughout Europe ."

Walsh expects BPL's role to expand as green power generation projects such as home-based generation, solar panels, wind farms, tidal power and more start populating the grid. Interconnection with those projects will make managing the reliability of the grid ever more complicated -- and some look to BPL as an obvious answer to managing that complexity.

They saw cable get smart

BPL reminds Walsh of the early days of cable. People in 1997 told him cable modem networks "couldn't happen, it wouldn't work -- we were dreaming." BPL is in roughly the same position as cable was then -- with a lack of standards, some engineering challenges in creating networks plus it's got its nay sayers.

The broadband boom in Europe was similar to "the wave that's building for smart grids. "Cable traditionally was a one-way, wire-based distribution network. Sounds familiar.

Cable modem technology introduced tremendous advantages by adding IP to those networks.

Suddenly the operator could see the condition of every piece of gear on the network all the way to the customer's modem.

That gave Walsh a brand new kind of power in making financial decisions. He could make choices on where to spend money on the network -- based not on which technology officer in field wrote the most compelling request, "but on actual live statistics," he stressed.

His operational crews -- that had only ever been reactive -- could now act proactively based on real-time data and "before stuff breaks." Walsh would set targets and key performance indicators for his managers and then "see how they were doing -- not based on a score card but actual real statistics, real facts."

QUOTE OF THE WEEK: All of a sudden you had huge efficiencies coming into the operation which means you gave better end-service to the customer. At the same time you were able to reduce costs of providing the service. This was all happening in the cable sector probably in the years of 2002, 2003. Take that benefit and combine it with BPL and you are making that business case look much rosier.

Tom Walsh, CTO, Smartgrid2

These folks have scaled

Another similarity with cable is the problem utilities face in scaling data networks to cover entire utility footprints. Those are the same problems Walsh tackled with cable-based broadband, he reminded.

It takes "business nerve" to wait for the opportunities to ripen -- and then capital to take advantage of the moment when it's right.

Superior technology will win out, he added. "For us, ‘smart grids' is nothing new.

"We deployed similar technology on communications networks and quickly realized the operational benefits when scaling is handled correctly."

While Smartgrid2 works on landing utility contracts, the firm has started deploying MDU networks in the hospitality industry in Ireland .That work helps the firm add hands on experience with BPL plus generate revenue. ( www.mains4.com )

An invitation to Europe

Grids around Europe offer various challenges and "customizing hardware and software for individual markets is crucial," said Walsh. "A partnership with the right European player can ease that pain.

"We are actively seeking to represent manufacturers over here." Smartgrid2 partnered with a firm that's got 180 trained, certified line crew workers "who excel on the physical installation of utility gear.

"Any executive struggling with how to hit Europe should get in touch. "If they are serious and can deliver, we'll be happy to help them exploit the European opportunities we uncover through our role in the advisory and working groups."

Smartgrid2 isn't married to any manufacturer or chipset, Walsh reported, and that lets it "work in an unbiased way to select best-of-breed technologies.

"The smart grids principle is not new. "It's been [used] in the telecom sector for over four years and has revolutionized both technical and operational management.

"These benefits can now be realized by power utilities, too"

Tom Walsh is the former VP of Global IP Operations and Engineering for Europe's biggest MSO (Multiple Service Operator) where he deployed cable SmartGrid solutions, Broadband IP systems and networks throughout the EU, Latin America and Asia Pacific.