Wild on Wireless Networking: WLAN Market Young, Energetic and Growing

Although the first half of 2001 has been marked by indications of an economic downturn, Cahners In-Stat Group expects the Wireless LAN (WLAN) market to show healthy growth throughout the forecast period. In the LAN space, wireless networking is really the next step, and Cahners In-Stat Group believes that shipments will continue to grow, as prices fall and new technologies bring increased speeds.

By 2005, the total enterprise WLAN end-use revenues will be $4.6 billion. Throughout the forecast period, revenues will grow significantly less than shipments, as prices continue to fall steeply. The driving force in the WLAN market will be Wi-Fi products, including 802.11b and 802.11g products. These products have been especially successful in penetrating the education, hospitality, healthcare and financial environments, and, as prices fall in 2001 and 2002, other industries will adopt them at a high rate. Also, the push of these products into areas outside of North America will continue to be a boon for the industry. In 2002, the growth rate in end-use revenues will increase as comparatively high-priced 5 GHz products are introduced into the market.

Executive Summary

Methodology

History of the Wireless LAN Market

The Early Years

The First IEEE WLAN Standard

A New Generation for the WLAN Market

WLAN Architectures

Wireless LAN Market Drivers

Price/Performance

Security

WEP Security

WEP's Weaknesses

Why WEP was Chosen

IEEE 802.11 Task Group E's Activities

Vendor Security Enhancements

802.1x

Management

Roaming

Wireless LAN Standards and Interest Groups

IEEE 802.11

802.11b

802.11g

802.11a

HiperLAN1

HiperLAN2

HomeRF

Wide Band Frequency Hopping (WBFH)

Bluetooth

Ultra-Wideband

WLAN Silicon Providers

Enterprise WLAN Market Shares

Direct Sequence

Frequency Hopping

Industrial Embedded

End-User Data

Worldwide Enterprise Wireless LAN Forecast

IEEE 802.11g's Effect on WLAN NIC & AP Forecasts

WLAN NIC Market Forecasts

WLAN Access Point Market Forecasts

Enterprise WLAN Building-to-Building Bridge Market

The Wi-Fi Market

Wi-Fi Geographic Breakdowns

Wi-Fi Vertical Breakdowns

Vendor Profiles

3Com

Agere

Buffalo Technologies

Cisco

D-Link

Enterasys

Linksys

Proxim

Symbol Technologies

List of Tables

Table 1. Enterprise WLAN End-Use Sales (US$M)

Table 2. Wireless LAN Timeline

Table 3. WLAN Silicon Providers

Table 4. Direct Sequence Enterprise WLAN NIC Unit (k) Market Shares

Table 5. Direct Sequence Enterprise WLAN NIC End-Use Sales ($k)

Table 6. Direct Sequence Enterprise WLAN Access Point Unit (k) Market Shares

Table 7. Direct Sequence WLAN Enterprise Access Point End-Use Sales ($k) Market Shares

Table 8. Frequency Hopping Enterprise WLAN NIC Unit (k) Market Shares

Table 9. Frequency Hopping Enterprise WLAN NIC End-Use Sales ($k) Market Shares

Table 10. Frequency Hopping WLAN Enterprise Access Point Unit (k) Market Shares

Table 11. Frequency Hopping WLAN Enterprise Access Point End-Use Sales ($k) Market Shares

Table 12. Industrial Embedded Card Market Shares

Table 13. Industrial Embedded Card End-Use Revenues Market Shares

Table 14. WLAN End-User Trends: Comparison of Current WLAN Users to Future WLAN Users

Table 15. Worldwide Enterprise WLAN Annual Unit Forecast 1998-2005 (000's)

Table 16. Enterprise WLAN Annual End-Use Sales 1998-2002 (US$M)

Table 17. Comparison of IEEE 802.11g Proposals

Table 18. Enterprise WLAN NIC Forecast by Transmission Type (If PBCC is chosen for 802.11g)

Table 19. Enterprise WLAN NIC Forecast by Transmission Type (If OFDM is chosen for 802.11g)

Table 20. WLAN NIC End-Use Revenues by Transmission Type (If PBCC)

Table 21. WLAN NIC End-Use Revenues by Transmission Type (If OFDM)

Table 22. Enterprise WLAN AP Unit Forecast by Transmission Type (If PBCC is chosen for 802.11g)

Table 23. Enterprise WLAN AP Unit Forecast by Transmission Type (If OFDM)

Table 24. Enterprise WLAN AP End-Use Revenues ($M) by Transmission Type (If PBCC)

Table 25. Enterprise WLAN AP End-Use Revenues ($M) by Transmission Type (If OFDM)

Table 26. Enterprise WLAN Bridge Unit Forecast (000's)

Table 27. Enterprise WLAN Bridge End-Use Sales Forecast (US$M)

Table 28. Wi-Fi NIC & AP Unit Forecast ¾If PBCC

Table 29. Wi-Fi NIC & AP End-Use Revenue Forecast ¾ If PBCC

Table 30. Wi-Fi NIC & AP Unit Forecast ¾ If OFDM

Table 31. Wi-Fi NIC & AP End-Use Revenue Forecast ¾ If OFDM

Table 32. Wi-Fi NIC Unit Forecast ¾ If PBCC

Table 33. Wi-Fi NIC End Use Revenues Forecast ¾ If PBCC

Table 34. Wi-Fi NIC Unit Forecast ¾ If OFDM

Table 35. Wi-Fi NIC End-Use Revenues Forecast ¾ If OFDM

Table 36. Wi-Fi AP Unit Forecast ¾ If PBCC

Table 37. Wi-Fi AP End-Use Revenue Forecast ¾ If PBCC

Table 38. Wi-Fi AP Units Forecast ¾ If OFDM

Table 39. Wi-Fi AP End-Use Revenues Forecast ¾ If OFDM

Table 40. Geographic Breakdown of Wi-Fi Shipments

Table 41. Vertical Breakdowns of Wi-Fi Shipments

Table 42. Wi-Fi Vendors and Products

List of Figures

Figure 1. Typical WLAN Configuration

Figure 2. Roaming Between APs

Figure 3. WLAN Technology Matrix

Figure 4. WLAN Technology Roadmap

Figure 5. Direct Sequence Enterprise WLAN NIC Unit Market Shares (2H00)

Figure 6. Direct Sequence Enterprise WLAN Access Point Units Market Shares (2H00)

Figure 7. Frequency Hopping Enterprise WLAN NIC Unit Market Shares (2H00)

Figure 8. Frequency Hopping Enterprise WLAN Access Point Unit Market Shares (2H00)

Figure 9. Current Deployments of Wired & Wireless LAN Networks

Figure 10. Expenditures on WLANs by Companies Currently Having WLANs

Figure 11. Expenditures on WLANs by Companies Planning to Deploy WLANs

Figure 12. Enterprise WLAN Forecast 1998-2005 (Units, 000's)

Figure 13. Enterprise WLAN End-Use Sales 1998-2005 (Annual, US$M)

Figure 14. WLAN NIC Unit Forecast by Transmission Type (000's) ¾ If PBCC

Figure 15. WLAN NIC Unit Forecast by Transmission Type (000's) ¾ If OFDM

Figure 16. Enterprise WLAN Access Point Unit Forecast by Transmission Type (000's) ¾ if PBCC

Figure 17. Enterprise WLAN Access Point Unit Forecast by Transmission Type (000's) ¾ if OFDM