Wireless LAN integrated circuits to generate $2.1 bln in 2008

As businesses and consumers have sought to wirelessly network PCs and other peripherals without the cost and complexity of installing and managing a cable infrastructure, the Wireless Local Area Network (WLAN) IC market has grown rapidly over the past four years, reports In-Stat/MDR. The high-tech market research firm believes that through 2008, Consumer Electronics (CE) and Wi-Fi IP telephony will both represent significant market opportunities for Wi-Fi, and, by extension, WLAN ICs. A range of CE devices, including HDTVs, PVRs, DVD players, media adapters, music players, digital cameras, and game consoles, will benefit from Wi-Fi connectivity.

Revenue from WLAN ICs sold into CE and IP telephony applications together will account for roughly half of the $2.1 bln in revenue expected to be earned in 2008. Recently, this market has consolidated, with many former vendors now either out of business or acquired by larger companies, in the face of stiff price competition. Surprisingly, Taiwanese vendors have not yet had as significant an impact as many thought they would. At present, a handful of vendors, mostly located in the US, dominate the market. These include Agere, Atheros, Broadcom, Conexant, Intel, Marvell, and Texas Instruments. Work on new standards to improve rate, reach and functionality continue. The 802.11i security standard was ratified in June 2004, and ratification of the 802.11e QoS standard, for multimedia applications, is expected later in 2004. A standard to improve Wi-Fi throughput to a minimum of 100 Mbps is currently being developed and is expected to be ratified sometime in 2006 or 2007, although pre-standard equipment is already starting to appear on the market.