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Industry News

Wireless Market 2002: Wireless Networking Gets Cheaper

July 1, 2002
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In-Stat/MDR has completed its analysis of the WLAN market's performance during the first quarter of the year. The main themes from the results include the following:


· Embedded WLAN in notebook PCs is finally taking hold in the business space. Notebooks with embedded Wi-Fi (IEEE 802.11b) finally hit the market in noticeable volumes in the first quarter of 2002, from the likes of IBM, Toshiba, HP and Fujitsu. Agere and Actiontec, two of the main Wi-Fi mini PCI suppliers to PC OEMs, benefited from this uptake in embedded Wi-Fi.

· Asia Pacific and Europe are increasingly taking away geographic share of WLAN shipments from North America. Hot regions include Japan and South Korea, Singapore, Taiwan, Australia, the Nordic European countries and the UK.

· The high end enterprise segment of the WLAN market performed poorly in the first quarter, as shipments of enterprise-class AP solutions greatly slacked behind those of lower end, sub-$200 AP solutions. In-Stat/MDR believes that one reason for this slowdown was the significant tightening of corporate budgets. However, another significant reason may be that many large and medium businesses are waiting to deploy hardware that supports both Wi-Fi and Wi-Fi5 (IEEE 802-11a), in order to be able to support 802-11b, anticipated 802-11g, as well as the increasing number of 802-11a clients. So, scalability and potential technology obsolescence weighed heavily on the minds of corporate WLAN buyers in the first part of 2002.

· Much of the growth in business WLAN shipments was primarily driven by low cost providers that were also strong in the home market, including Linksys, Buffalo, D-Link and Netgear. In-Stat/MDR believes low cost APs are being deployed in SOHOs, small businesses and in many branch or remote offices of large businesses, as well as in individual departments within large corporations. These APs are widely available in retail and e-tail, at sub-$200 prices.

· The residential Wi-Fi market continued to drive overall WLAN volume growth. The growth was heavily spurred on by the popularity of low cost wireless broadband gateway products (combo AP and router devices often with multiple Ethernet ports and optional print servers), increasingly available from a variety of vendors, at continually falling prices.

For the first quarter, non-trivial shipments of 802-11a NICs and APs were recorded, from the likes of Intel, SMC, Netgear, Proxim, D-Link and Actiontec. Although many of these 802-11a pioneers had announced that they were shipping in 4Q2001, most did not have product ready to ship until 1Q2002, needing additional time to refine products.

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