Wireless LAN market proved resilient in first half of 2001

Dec. 6, 2001
December 6, 2001 Vertical markets of education, retail, finance, and healthcare helped buoy growth this year.

The business Wireless LAN (WLAN) market was remarkably resilient throughout the course of the first half of 2001, with a growth rate exceeding expectations even in the midst of a technological economic downturn, according to Cahners In-Stat Group (www.instat.com).

Growth was buoyed by strong sales to verticals, including education, retail, financial and healthcare in addition to the build-out of existing WLAN networks.

"Although 1H '01 WLAN business growth was exceptional, and the beginning of 3Q '01 was strong due to high seasonal educational sales, September sales were certainly affected negatively by the events of Sept.11," says Gemma Paulo, an industry analyst with the high-tech market research firm. "Overall, market performance in 2H '01 and 2002 will be shaped by the early release of 802.11a products, the economic situation in the aftermath of Sept. 11, the ability of IEEE 802.11g products to penetrate the market, and the acceptance of Windows XP as a must-have upgrade for the business."

In-Stat has also reports that:

* Asia Pacific and Europe remained strong geographic segments in the first half of this year, however, North America grabbed the lion's share of the market. Hot geographies for WLAN growth included South Korea, Australia, New Zealand and Brazil.

* Once again, Agere Systems and Cisco Systems Inc. battled for leadership in the WLAN Network Interface Card (NIC) market, with Agere leading the market in the first half of 2001, accounting for 15% of units shipped and almost 14% of end-use sales.

* Linksys, D-Link, Netgear, SMC and other high-volume, low-cost vendors pushed out their WLAN wares aggressively through retail channels, online venues and catalogs, greatly spurring 802.11b sales to the small business space.

* The overall WLAN market will grow from 3.3 million total units shipped in 2000 to 23.6 million total units shipped in 2005. However, revenues are not expected to keep pace with shipment growth, based on the rapid price erosion experienced by 802.11b products, especially NICs.

The report, Life, Liberty and WLANs: Wireless Networking Brings Freedom to the Enterprise (#LN0110WL), includes five-year forecasts of the worldwide business Wireless LAN market. This report gauges the size of the current market, and forecasts product units shipped and end-use sales for NICs, access points and building-to-building bridges.

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