GE Breaks into Backhaul — Is Local Networking Next?

by Jacob Grose

While GE executives spent most of their time at the GE Smart Grid Media Summit hyping the benefits of their smart meters and Home Energy Manager to the consumer (Lux Research Power Journal, July 22, 2009), the most interesting discussions surrounded the company's announcement in March that it will be introducing a WiMAX backhaul system to connect CenterPoint Energy’s smart meters to its centralized Houston-area facility. According to the announcement, “GE Digital Energy’s MDS Mercury 3650 radios... will support the transmission of electric utility meter data over the AMS [Advanced Metering System] network from consumers’ homes and businesses to CenterPoint Energy’s data center.”

The backhaul connection is the link between the local area networks (LANs) consisting of interconnected smart meters to the central utility. Many Smart Grid companies that focus on LANs are making deals with telecom firms for backhaul, with Ambient partnering with Verizon, SmartSynch with AT&T, and Echelon connecting its meters directly to T-Mobile's network. Trilliant, another LAN player, recently announced the acquisition of SkyPilot Networks, a provider of wireless mesh broadband equipment, to enhance its backhaul capabilities (LRPJ, June 3, 2009).

But instead of moving from a LAN business to backhaul, GE is likely to move in the other direction in the next couple of years, to offer a networking system to connect its smart metering infrastructure to its WiMAX backhaul connection.

Why? According to Luke Clemente, General Manager of Smart Grid for GE Transmission and Distribution, the company is still uncertain about which LAN technology — among RF mesh, WiMAX, broadband over powerline (BPL), and others — will win out.

Moreover, Luke said GE does not want to offend its “valuable” LAN partner, Silver Spring Networks, a company that Bryan Olnick, Senior Director at Florida Power and Light (FPL), told Lux Research it made very impressive technology that he felt would “explode” in the next few years.

Yet, in the long run, GE will be unable to resist owning a piece of the entire Smart Grid pie. And once it settles on a winning LAN technology, the company will be looking either to acquire an existing player (such as Silver Spring) or to develop its own technology internally.

Jacob Grose is an analyst for Lux Research, which provides strategic advice and on-going intelligence for emerging technologies. Leaders in business, finance and government rely on Lux Research to help them make informed strategic decisions. Through their unique research approach focused on primary research and their extensive global network, they deliver insight, connections and competitive advantage to their clients. For more information, visit the site at the link below.

Or contact contact Carole Jacques to become a Lux Research client.

   Email Jacob Grose

   Lux Research home page

   GE CenterPoint Energy press release