Healthy growth ahead for worldwide WLAN semi market

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10 October 2001 News

The total wireless LAN (WLAN) semiconductor market will show a healthy growth rate over the next five years. According to IDC, total market revenues will increase at a 2000-2005 compound annual growth rate (CAGR) of 29%. Fuelling this growth will be the development of the 5 GHz segment, which will emerge in 2002. The more mature 2,4 GHz market, which grew 53% to $216m in 2001, will increase at a more moderate CAGR of 8,6% during this time.

"The demand for mobile connectivity, coupled with increasing support from PC makers, will contribute to the growth of the WLAN semiconductor market," said Ken Furer, Research Analyst with IDC. "However, the industry is still very young and has yet to prove itself. Successful adoption hinges on increased industry cohesion."

WLAN semiconductors continue to be a key area of growth within the technology sector. Revenue opportunities for baseband and radio chipsets supporting the more widely used 2,4 GHz IEEE-802.11b standard remain strong, while IEEE-802.11a, operating within the 5 GHz spectrum, offers even higher bandwidths and fewer interference issues than before. Although momentum remains behind the IEEE-802.11 technologies, HomeRF and HiperLAN/2 are still contending in WLAN as well.

Regarding the competition, Intersil remains the dominant supplier in the 2,4 GHz market with a supporting cast that includes Agere, Cirrus Logic, Cisco Systems, Proxim, Philips, Texas Instruments, and others. A myriad of players are looking to enter the 5 GHz market including start-ups like Atheros, Envara and Resonext, along with most 2,4 GHz vendors and other established companies like National Semiconductor and ST Microelectronics. "As the WLAN semiconductor market matures, products will become more standardised and cost reduction pressures will intensify. This will make it even more imperative for vendors to produce low-cost solutions," Furer said.

www.idc.com

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Healthy growth ahead for worldwide WLAN semi market

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