Telkonet Gives Power to Resellers

By Khali Henderson

Telkonet Inc. in mid-April plans to roll out voice functionality for its patented Telkonet PlugPlus commercial powerline LAN communications system. This enhancement will give its value-added resellers - namely ISPs, property management companies and some telcos - low-cost entrance into the telephone business serving multitenant offices and apartments.

Ron Pickett, president and CEO of Telkonet, says PlugPlus was designed to support voice and video as well as data, but the QoS technology and market were not available when the company debuted PlugPlus as the “outlet to the Internet” in early 2004.

The PlugPlus system consists of three pieces: a gateway that takes the broadband signal from outside the building and converts it to a powerline carrier (PLC) format; a coupler that distributes the PLC signal from the gateway into the electrical circuit breaker inside the building; and a retrieval system, the Telkonet iBridge, which is a small adapter that plugs into any outlet and takes the PLC signal in and sends Ethernet out via an RJ45 connection to a PC or Wi-Fi access point. A fourth, optional device is the Telkonet eXtender, which provides PLC signal propagation and LAN extension to extend the reach of the system by replicating the signal.

Pickett says that in the 32-story Trump Tower, for example, only one gateway and one eXtender were required. Each gateway can support up to 1,024 iBridges, but so far no deployments have tested this design capacity, Pickett says.

To add voice functionality, Telkonet has developed QoS software for its gateway; the iBridge already includes voice, video and data cards, says Pickett. Most of the installed gateways will be upgradeable remotely, he adds, noting the gateway is in its third generation.

Telkonet provides the PlugPlus backbone infrastructure to its resellers free and charges them $6.95 per month per iBridge deployed. (With the addition of QoS, this rate will increase nominally, if at all, Pickett says.) Resellers can charge tenants as they choose, he says, noting that most go into a building and charge $10 less than the incumbent. “They are running at a 28 percent market penetration, which is phenomenal,” Pickett says, adding resellers are reporting 100 percent take rate with new tenants faced with the other options of cable or DSL.

Frank Matarazzo, president of Microwave Satellite Technologies Inc., a Telkonet reseller, says PlugPlus is not an equipment play, but a platform play that is disruptive to today’s marketplace. “What is a stranded asset [in the electrical system] turns into a revenue generator or a third wire” for LAN and building control functions as well as money-making applications like voice, IPTV and wireless services that can be sold to tenants, he explains.

MST is working with Telkonet technology to provide telecom services to residents in Trump properties in New York.

“It offers the convenience of wireless and security of hardwired systems,” he says, noting that it brings broadband right to the point of power, whether that’s an outlet or lamp socket or lighted exit sign.

“It’s the quickest and lowest-cost” way to light up a building, Matarazzo adds. “We can fire it up in an hour,” he says, referring to hooking the system to the electrical panel. It’s longer to pull the cable in from the street to the gateway, he adds.

And, he says, there is no argument about whether the telco or the landlord owns the infrastructure as the electrical wiring is part of the property.

Telkonet also plans to release a pricing schedule for those resellers that want to buy the system outright and private-label it; details were not available at press time at the end of March.

Pickett adds in third quarter the company will release a new high-bandwidth model of its gateway, increasing the throughput from 14mbps to 85mbps. The release, he says, is targeted for use in large government and commercial buildings.