DS2’s powerline potential
- Article 4 of 25
- Infoconomist, May 2001
The last few months have seen a resurgence of interest in 'powerline networking' - the use of electricity networks to transport data and voice communications. DS2 offers chips that it claims supports voice, data and - uniquely - video communications at up to 45Mbps over powerlines.
The last few months have seen a resurgence of interest in 'powerline networking' - the use of electricity networks to transport data and voice communications. Several electricity companies, including Iberdrola Redes and ENDESA in Spain, have begun trialling the technology, while German utility, RWE, has launched a full commercial service.
Underpinning those efforts are a small group of young companies that have been attempting to overcome the technology hurdles that have long dogged the sector. DS2, for example, is the Spanish start-up providing ENDESA's technology. It claims that its chips support voice, data and - uniquely - video communications at up to 45Mbps over powerlines.
Formed in 1998 using European Union research and development funding, the company was lead partner in the project to develop powerline transmission technology with Cisco and Electricité de France. First prototypes came in March 2000, which was followed by ENDESA investing $14 million (€15.9m) in the company. The trials mean that DS2's technology has now deployed to 100 users, while ENDESA carryies out further tests in Europe, the USA and Japan.
One worrying factor is that DS2 is only just beginning to ramp up its manufacturing operation to produce chips on a commercial level. In the meantime, ENDESA remains its only customer.
DS2's management team - which includes operations director Jose Maria Llopis and analogue design manager Pedro Sanchez, both veterans of chip design and the nuclear power industry - are well aware of the problems they face. They not only have to catch up with the opposition; they must also overcome resistance to powerline technology among potential customers, and convince legislatures that the radio-signals generated by the powerlines are acceptable.
Consequently, the team is looking for another round of funding to provide the EU10 million it needs to expand its marketing and sales efforts. It aims to IPO in 2003 and claims that several large companies are already hoping to buy the company. But whether or not the company can achieve these lofty aims depends entirely on whether or not powerline networking can prove its worth in the highly competitive telecommunications market.