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RealTime IT News

Hotspots Seen as Telecom Bright Spots

Here's something new: a telecom equipment forecast free of the adjectives "flat," "stagnant" and "declining."

The niche is wireless LAN (wireless local area network) hardware, which is expected to mushroom as users seek Internet access through access points, or hotspots, located in public places such as airports, cafes and libraries.

Hotspots, which are tied into broadband connections, allow users to access the Internet through phones, handhelds or laptops. All that's required for the device is a wireless LAN adapters, which are becoming increasingly common.

Infonetics pegged the market for WLAN hardware at $436 million in third quarter. Access point hardware accounted for 60 percent of sales and Network Integration Cards for 40 percent. Sales are briskest in North America, followed by Europe and Asia Pacific.

The London IT research firm anticipates sales will reach $2.3 billion in 2005.

"Hotspots are an inexpensive way for service providers to drive subscriptions for an increasingly mobile but data-reliant workforce, so the stage is set for widespread rollout," Infonetics'analyst Richard Webb said.

Several large service providers, including T-Mobile, offer the service, while others plan to. Unlike some telecom offerings, users are ready to embrace the new technology.

"Users love mobility and they love the Internet," Webb said. "Wireless LANs are a great blend of the two, and the WLAN adoption rates we are seeing in the enterprise space proves users are already comfortable with it."

As with any wireless technology, the quality of network coverage, will drive adoption rates. Infonetics expects enterprise users to be the first users, however, the ability to stay connected has broader appeal.

Cisco and Linksys lead in the race to supply service providers with the necessary equipment. Broadband vendors NetGear, Buffalo, and D-Link are close behind, Infonetics said. Other players in the space include enterprise suppliers 3Com, Avaya, and Enterasys and mobile specialists Symbol and Promix.

The jockeying will continue in 2003 as new higher-performace 802.11a products are introduced and security and traffic management systems are developed, Infonetics said.