Cheaper, Better Wi-Fi ICs to Drive Consumer Wi-Fi Products Adoption, Says ABI Research.

Business Editors/High-Tech Writers

OYSTER BAY, N.Y.--(BUSINESS WIRE)--May 6, 2004

The popularity of Wi-Fi technologies in consumer electronics in the home has already been demonstrated. Its adoption in hand-held devices, however, has until recently been hampered by design limitations in Wi-Fi chipsets, and their relatively high power consumption. But that is about to change, according to Phil Solis, Senior Wi-Fi Analyst at ABI Research.

Recent breakthroughs in Wi-Fi IC design have allowed the integration of all three of the necessary subsystems - radio, baseband and Media Access Control (MAC) - onto one chip offering 802.11b and/or 802.11g communication. This has resulted in smaller ICs that use less power, especially in the "sleep" or "standby" modes that take up most of a Wi-Fi appliance's running time. "As Wi-Fi ICs continue to solve the problem of power consumption," said Solis, "they will find their way into smaller devices."

Such ICs are also cheaper to manufacture than their predecessors, and a trend of increasingly lower cost seems set to continue as the market develops. Several manufacturers are now producing these combination chips, notably Atheros, Broadcom and Philips, and handheld devices employing them are starting to enter the market. In February, for example, Motorola debuted its MPx phone which adds Wi-Fi capabilities using Texas Instruments ICs and Nokia intends to release its 9500 Communicator in the last quarter of 2004.

The basis for Wi-Fi's adoption in cell phones, PDAs and other portable devices lies in its increasing use in the home. Surveys indicate that in the US, about a fifth of all broadband Internet customers already employ Wi-Fi for wireless distribution of online access around the house. Increasing availability of affordable Wi-Fi handsets and services should build on that foundation. ABI Research expects strongest growth in the cell phone sector, rather than in PDAs.

Handset manufacturers should be well placed to capitalize on that trend, especially given the interoperability of most portable operating systems.

More information on Wi-Fi IC developments and their likely results in the marketplace may be found in ABI Research's Wi-Fi Quarterly Service, which provides data on hotspot deployments, integrated circuits, network equipment and other key market drivers. Emerging Wi-Fi opportunities and the technology's future co-existence with cellular technologies are also provided.

Founded in 1990 and headquartered in New York, ABI Research maintains global operations that support annual research programs, quarterly intelligence services and market reports in wireless, automotive, semiconductors, broadband, and energy. Their market research products can be found on the web at www.abiresearch.com, or by calling 516.624.3113.