Home Wireless LANs Flying High

The surprising uptake of wireless home networking gear by end-users helped

push the in-home networking equipment market up 97 percent in total sales

in 2000, to end the year at $290 million, according to Cahners

In-Stat Group.

“Wireless was the story of 2000 for the home networking industry. Both

802.11b and Home RF-based networking hardware saw brisk sales growth quarter

to quarter, with the fourth quarter of 2000 showing very impressive growth

numbers,” said Mike Wolf, director of enterprise and residential communications

at In-Stat. “Our research has shown that wireless is very intuitive to

end-users, in that they embrace the benefits of wireless networking for

such applications as broadband Internet sharing.”

Both the wireless and phoneline network markets saw fierce competition

among the different market participants in 2000. Agere Systems (formerly

part of Lucent) saw its ORiNOCO wireless LAN product garner nearly 37

percent of annual wireless home networking end-use sales. Proxim totaled

25 percent of total wireless home networking revenues in 2000 on its lower-priced

Symphony product line. Intel dominated the phoneline home networking space

with 53 percent of all connections.

“While the wireless and phoneline have been the primary focus among

the different media transport layers for home networking the past couple

of years, many continue to underestimate the continued strength of good

old Ethernet,” Wolf said. “Because of its familiarity, field-tested reliability

and low cost, Ethernet continues to see strong uptake in homes as consumers

move to install low-cost PC to PC networks.”

According to the Cahners report “Are

We Connected Yet?: 2000 Home Network Market Shares and 2001 Preview,”

the home networking market will continue to see strong growth as:

  • Vendors release second-generation products and wireless networking

    products continue to drop in price

  • Consumers beyond the early adopters adopt broadband and begin to

    see the benefits of home connectivity

  • Consumer ISPs such as AOL and Earthlink push new home network strategies
  • Windows XP for Consumers (which is focused on networking connectivity

    and broadband) is released in Q4 2001 and drives a new PC sales cycle.

According to Strategy Analytics,

the market for Wireless Local Area Networks (WLANs) will top $2.5 billion

by 2006. An increasing number of businesses are choosing wireless solutions,

seeing them as valuable tools with which to achieve ultimate productivity.

“Wireless LANs offer businesses flexibility on a scale that is just

not possible with wired alternatives,” said Sara Harris, senior industry

analyst in the Strategy Analytics Global Wireless Practice. “Costs are

coming down, speeds are going up and the performance gap between wireless

and hard-wired LANs is narrowing significantly.”

The adoption of wireless offices will be driven by the needs of company

users rather than by company size. Harris identifies “road warriors” as

those who need the most mobility, with “desk pilots” needing the least.

“The size of the business will be less important than user profiles within

it,” she said.

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