DirecTV said it would bundle broadband-over-powerline high-speed Internet and VoIP with its digital TV services to about 1.8 million homes in the Dallas-Forth Worth, Texas region by early 2008.

Benefits of broadband-over-powerline include faster upload and download speeds compared to many cable and DSL broadband services: up to 10Mb versus 8Mb, according to Current. The broadband service is symmetric, which means upload speeds are as fast as download speeds.

Moreover, broadband-over-powerline works via a go-anywhere, installation-free modem that’s about the size of a regular power adapter and plugs into any electrical outlet. It is Ethernet and WiFi enabled, which means it can fill in wireless coverage gaps created by cable or DSL, said Current VP of corporate development and strategy Brendan Herron.

Broadband-over-powerline is an emerging technology that adds a communication network on top of an electrical utility backbone that supports broadband, VoIP and other applications. Current’s broadband-over-powerline strategy plays into the smart grid concept, which is to give traditional one-way utility networks real-time intelligence in order to maximize efficiency. Essentially, the same communications layer that sits on top of a power-plant infrastructure to give users broadband also transmits electric-usage information back to the utility’s central office. The Electric Power Research Institute in the US predicts that smart grids may reduce power-related disturbances in the country by 87%.

Herron said the company can only offer broadband-over-powerline services once it has a utility smart-grid deal in place. He said the company expects to announce more deals in the US, Europe and Latin America in the future, but declined to give specifics.

Currently, the company has just one other US deployment in addition to its Dallas network and that’s in Cincinnati, Ohio, where it sells broadband services directly to customers. Its Cincinnati network is an older version of the technology, however, and has just 3Mb maximum download and upload data speeds. Herron said DirecTV’s service will go up to 10Mb.

DirecTV VP of broadband Evan Grayer said the company had not yet released what broadband over powerline speeds it will offer customers. The downloads speeds are potentially much better than cable, Grayer said.

El Segundo, California-based DirecTV is adopting the technology also because of its convenience to the user, he said. It has a non-exclusive deal with Current to offer the technology wherever else Current builds a network. We’re proving it out, Grayer said said of the Dallas network. He said it was too early to say whether it would roll out the service elsewhere given the opportunity. He said the company currently is looking just at a residential service in Dallas, but he did not rule out an SMB or enterprise offering at some future point.

DirecTV already offers bundles of TV, broadband and VoIP via partnerships with AT&T, Clearwire, Qwest and Verizon.

Current’s Herron said some telecommunications companies have expressed interest in its broadband-over-powerline technology, but more so in Europe than in the US. We will get out on a market-by-market basis, Herron said. It all depends on the market, domestically and internationally.

Privately held Current, which is based in Germantown, Maryland, has raised more than $200m in venture capital funding since it launched in 2000. Its financial backers include Earthlink, General Electric, Google and Hearst. Herron declined to comment on the company’s financial status or whether it was seeking any additional capital. The company has one international office, in Switzerland, and will set up additional operations wherever it builds networks, Herron said.

Our View

While there are a number of smaller broadband-over-powerline players, Current is the best-funded and has the most commercial deployments. And having such a US brand-name customer as DirecTV further validates Current’s business plan. It is the first high-profile communications deal for the technology in the US and we expect there’ll be more from Current both in US and in Europe.