Why aren’t the electric utilities
    in the communications business?

Getting some competition into retail telecommunications seems like an important objective.

Some years ago there was discussion about having the local power companies provide communications services by somehow modulating their power current to carry information. Presumably that couldn’t be made to work on a technical level, which isn’t really surprising.

But there’s another, technically much less demanding, way for the power companies to compete with the telcos and the cable companies. They already have a set of wires going into every household and business, and the rights of way to support those wires. Would they be within their legal rights to string a second set of wires on those same poles (or to string new wires carrying both power and signals)? I don’t know what the useful life of the wires is, but presumably they get replaced from time to time.

Does any reader know what the problem is with this? Hard to believe it’s technical. Are there legal barriers, or is the problem the culture and capital structure of the power companies? If the barriers are legal ones, can they be lowered? (Maybe not, if the problem is with the easements.) If the barriers are internal to the power companies, could someone set up a separate company that would pay the powe companies for the use of their wires?

Update Readers point me to this news story and this slashdot thread about the older idea of carrying signals by modulating electric-power current. Apparently: (1) the idea is alive, and in pilot operation; (2) the data rates are comparable to cable or DSL; (3) there are concerns about interference with ham radio; (4) the hams don’t have much of a case for why their hobby should be allowed to stand in the way of something with a serious chance of breaking the telco/cable company stranglehold and bringing decent telecom service to rural areas (at least judging by the arguments they come up with); and (4) apparently, as a legal matter, they might be able to sabotage the whole affair, and some of them are ornery enough to want to do so just to make a point.

Update A reader points me to this article, which suggests that some power companies are already installing fiber optic cable alongside their power cables, on the pretext of using it for remote meter-reading. That way the cost gets built into the rate base, thus shifting the cost and risk to the consumer. But the result is to create, over time, most of the infrastructure for a telecom system, with no interference problem to worry about.

Author: Mark Kleiman

Professor of Public Policy at the NYU Marron Institute for Urban Management and editor of the Journal of Drug Policy Analysis. Teaches about the methods of policy analysis about drug abuse control and crime control policy, working out the implications of two principles: that swift and certain sanctions don't have to be severe to be effective, and that well-designed threats usually don't have to be carried out. Books: Drugs and Drug Policy: What Everyone Needs to Know (with Jonathan Caulkins and Angela Hawken) When Brute Force Fails: How to Have Less Crime and Less Punishment (Princeton, 2009; named one of the "books of the year" by The Economist Against Excess: Drug Policy for Results (Basic, 1993) Marijuana: Costs of Abuse, Costs of Control (Greenwood, 1989) UCLA Homepage Curriculum Vitae Contact: Markarkleiman-at-gmail.com

Comments are closed.