The promise of major revenues from a triple play of services — video, voice and data — and the inevitable expansion of the networks required to deploy them will translate into an insatiable thirst for more power.
Now more than ever, the cable industry's power equation includes an emphasis on reliability, scalability and cost as cable operators, Internet-service providers and other multiservice operators scramble to ensure that their growing power needs are met.
Add to the mix rolling blackouts, an energy crisis and soaring electricity costs, and the concern over how an expanding network can power up and expand cost efficiently becomes even more acute.
Consequently, a new generation of alternative power sources has attracted service providers' attention. Meanwhile, traditional sources — such as batteries and backup generators — are moving through a new-and-improved cycle.
"Utility costs are increasing and business models are being affected," noted Eric Wentz, vice president of marketing for Alpha Technologies, Inc., a leading power supplier to the communications industry. "If energy costs rise 30 percent, it has a huge impact on an operator's business.
"The cable industry is very hungry for more reliability and greater independence from their power grids and incredibly anxious to incorporate alternative power sources."
So anxious, in fact, that Alpha — which for 25 years has provided traditional battery and generator power to the communications industry — is now exploring alternative power sources with vigor. It's allying with fuel-cell companies such as Ballard Power Systems, H-Power Corp. and Mosaic Energy LLC.
"We're reinvesting significant amounts of money in alternative sources of power like fuel cells, advanced battery technology, integration of photovoltaics and aggressively partnering with fuel-cell companies and others who might lead us to a commercial rollout," Wentz said.
Fuel cells offer high reliability and low maintenance and — unlike batteries — they don't need to be recharged, just refueled. They've primarily been used in NASA's space program, as hydrogen is a key component. That makes them too expensive for commercial markets. But that may be changing.
Fuel cells "would work best in industries that require uninterrupted power sources where high reliability is critical, like in the cable and telecommunications industries," said Glenn Doell, vice president of marketing and business development for Dais-Analytic Corp., a Florida-based developer of technology for homes and small businesses. "And there have been technical advances resulting in lower fundamental costs."
Those advances and lower costs earned Dais-Analytic a recent equity investment from Enron North America, a wholly owned subsidiary of Houston-based Enron Corp., and Korea's Goldstar Group.
The search for viable alternative power sources has also stretched to other traditional battery and generator suppliers.
"We're looking beyond rectifiers at fuel cells, flywheels, microturbines and others, but with the capital crunch, much of it has to be focused not only on the technology, but scalability, adaptability and costs," said Paul O'Rourke, business development manager, access networks group at American Power Conversion Corp. (APC). "Operators want a business solution. It's all [return on investment] and payback focused."
APC jump-started its entry into the cable and telecommunications power market with its recent, $75 million acquisition of Advance International Group. O'Rourke said that move reflects a growing strategy among many power providers as the cable industry adds two-way telecommunications services.
"We moved into the cable space because they're moving into telephony," he said. "In the DC-power space, we were passive to the cable industry. Now, with its expansion into telephony, we are actively pursuing that market and are looking at all partnerships."
EYES ON FLYWHEELS
Experts in the powering arena note that a key component to that strategy is exploring alternative power-source options.
"We're keeping our eyes on these alternative-power companies and have acquired some and partnered with others, such as flywheel companies and aluminum and zinc fuel-cell technology," said Rick Marcotte, vice president and general manager of Invensys Energy Systems North America. "We're partnering with some of those R&D [research-and-development] shops. Operators are asking us to stay on top of these developments."
Flywheels have particularly attracted more attention as a potential power source for expanding networks.
Once beset with a puzzling series of design flaws, funding obstacles, reliability and safety questions, flywheel- energy storage systems have moved beyond the laboratory test stage and into field trials, most notably at Cox Communications Inc. The MSO purchased 10 of Beacon Power Corp.'s flywheels.
"Flywheel technology is no longer an R&D project, but now a commercial product being manufactured," said Harvey Wilkinson, director of marketing for Beacon Power Corp., a producer of flywheel energy storage systems. "We shipped our first product late last year and now are manufacturing the product for customers who are now using flywheels in trial deployment."
Flywheels act as electromechanical batteries to store and release energy from a high-speed, rotating wheel housed inside a steel enclosure. The high-strength fiber composite rim spins at 30,000 revolutions per minute to store 2 kilowatt hours of usable energy.
With energy as the operative word, Beacon is pushing ahead with its plan to provide the cable industry with flywheel generated power.
"We're moving much closer to the energy requirements as service providers deploy modems, VoIP [voice-over-Internet protocol] and DSL [digital subscriber line] — and all of them require more power," said Wilkinson. "We're simplifying our design, and costs are dropping."
The key costs in deploying flywheel technology are in the carbon, graphite and fiberglass composites and electronics, Wilkinson noted. The cost for a typical flywheel is about $10,000, including software, electronics, installation and support.
"The big change we've made is streamlining installation," he said. "Customers are demanding four-hour-or-less installation times, so that's our goal and we're meeting it."
Flywheels aren't exactly mainstream, however, and most agree they aren't likely to become so. They're more expensive on a first-cost basis, and questions about their stability remain.
"An ongoing issue has been a flywheel crashing, but we do safety testing frequently and design crash management into the process," said Wilkinson. "At some point, we'll bring flywheels above ground in small, lightweight enclosures."
Those issues aside, flywheels essentially have a 20-year maintenance-free design and an increase of 2 to 6 kilowatts per hour — two potentially compelling reasons why more multiservice providers are keeping tabs on the technology.
"This year, we'll see plans for deployment, but we're still in the trial stage to see how operators use them in their networks, because each system has a different use," said Wilkinson. "Some will be in high-value sites like industrial parks and businesses and others in subdivisions, while the ISP market has high power requirements for their big data centers. They're all telling us their powering needs are increasing."
And they're increasing fast.
"The industry is moving very fast and trying to solve broadband video issues and high-speed-data powering requirements," added Dan L. Trayler, vice president of sales and marketing at power supply firm Convacent Corp. "When operators move to fiber-to-the-home, stand-alone network powering will become even more crucial, and most operators haven't dealt with what it will take to install a network-powering system."
What cable operators, ISPs and other service providers will have to deal with is a fast-emerging need for more juice.
Just where it comes from, how it's distributed or which alternative sources might provide relief are likely to push operators and traditional and alternative power source suppliers to heights of power.