Persistent supply constraints plague wireless LAN market: Dell’Oro

June 7, 2022
As backlogs for orders approach 10-to-15 times normal levels, the industry researcher reports that supply constraints discerned in 1Q22 are likely to worsen in 2Q22.
Dell'Oro Group

According to a recently published report by Dell’Oro Group, supply constraints that have plagued the wireless LAN market in 1Q22 will likely worsen in 2Q22, as a result of China's Covid lockdowns.

The market researcher for the telecommunications, networks, and data center IT industries further reports that several US-based wireless LAN manufacturers announced that their backlogs have approached ten-to-fifteen times higher than normal.

“Many enterprises have planned network upgrades and the popular connection is Wi-Fi. The trouble is getting it. Several manufacturers announced that components from second and third-tier suppliers became the bottleneck in 1Q22,” explained Tam Dell’Oro, founder, CEO and Wireless LAN market analyst at the firm.

Dell’Oro added, “Supply constraints have resulted in highly volatile quarterly performance vendor-to-vendor, depending on whether or not they have all the components. For example, sales may be up 20 percent in one quarter, and down 20 percent the next. Another item, which could potentially cause delays, that we are keeping our eye on are the contract negotiations between the west coast dockworkers union and the Maritime Association,” she concluded.

Dell'Oro's Wireless LAN 1Q22 Quarterly Report notes that Wi-Fi 6E sales accelerated during the quarter as more manufacturers launched productms and Extreme Networks and HPE Aruba expanded their portfolios.

Notwithstanding, according to the analyst, the adoption of Wi-Fi 6E (meaning the percent of total Indoor unit shipments as of the third quarter of the technology shipping) is tracking below the rates of the previous two technologies, Wi-Fi 6 and Wi-Fi 5 Wave 2.

"However, it is still early days and three quarters do not make a trend," added the analyst's statement.

Meanwhile, for the fourth consecutive quarter, the Retail vertical continued to rank among the top-performing verticals for the wireless LAN market.

The Dell’Oro Group Wireless LAN Quarterly Report offers complete, in-depth coverage of the Enterprise Outdoor and Indoor markets for Wireless LAN Controllers with tables containing manufacturers’ revenue, average selling prices, and unit shipments by the following wireless standards: 802.11ax (Wi-Fi 6 and 6E [6 GHz]), 802.11ac (Wi-Fi 5) Wave 1 vs. Wave 2, 802.11n, and historic IEEE 802.11 standards. The report's Enterprise market is portrayed by Cloud vs. Premises Managed, as well as by ten vertical markets.

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