IBM is building out the BPL networks as part of a US$9.6 million deal that it signed last year with Alabama-based broadband provider International Broadband Electric Communications () to expand broadband access to people living in rural areas that only have access to dial-up services. The companies currently plan to deploy BPL networks through seven electric cooperatives in Virginia, Michigan, Alabama and Indiana. Once operational, IBEC will serve as the cooperatives' official ISP.
IBM says in addition to bringing broadband connectivity to underserved areas, the new BPL connectivity will increase electric companies' ability to monitor, manage and control the reliability of their electrical grids. Currently, electric cooperatives serve roughly 12% of the population in the United States and provide about 45% of the electrical grid.
Bob Hance, CEO of the Michigan-based Midwest Energy Cooperative, says his company decided to participate in the BPL network program after issuing a survey asking its customers whether they wanted to get broadband access through their electrical service. The survey results, Hance says, were overwhelmingly in favor of signing up for the broadband program.
"We were amazed by the responses to the survey," says Hance, who describes receiving "thousands of letters from citizens of our community expressing their need for broadband in order to improve everything from childhood education to the future of their family-owned businesses."
The digital divide between urban and rural areas in the United States has been a hot topic among both politicians and ISPs. Because many ISPs have stated consistently that there isn't enough money to be made that would justify expanding their broadband networks to large areas with low population density, many in government have suggested subsidizing rural broadband in the United States. A issued earlier this year by content-delivery-network provider Akamai Technologies found that significant disparities remain between urban and rural areas in broadband-connectivity delivery, despite a relatively high number of broadband connections nationwide.
On the other hand, a recent report released by Gartner Research projects that the United States will close its digital divide significantly within the next four years, with 77% of U.S. households projected to have a broadband Internet subscription by 2012. Gartner says one of the biggest factors in the spread of broadband will be the advent of such 4G wireless services as WiMAX and Long Term Evolution that are expected to be launched in various markets over the next four years.
BPL so far has not caught on as a broadband technology in the United States. As of June 30, 2007, the FCC that only 5,420 people in the United States subscribed to broadband over power line, vs. 34 million cable subscribers and 27.5 million asymmetrical DSL subscribers.