June 28, 2001, 11:21 AM — Though products featuring Bluetooth have been slow to hit the market, the wireless technology is still expected to generate worldwide revenue of just under US$2 billion in 2001, growing to $333 billion by 2006, according to a study due out in July.
The study, published by market research company Frost & Sullivan Ltd., the U.K. branch of U.S.-based Frost & Sullivan Inc., predicts that 4.2 million products using the Bluetooth technology will be shipped to market by the end of this year, with 1.01 billion Bluetooth products making it to market by 2006, said Frost & Sullivan analyst Michael Wall.
Bluetooth is a standard for short-distance wireless communications, or wireless PANs (personal area networks), that connects devices at speeds of up to 1M bps (bits per second) and maximum distances of 10 meters. Initial Bluetooth products in 2001 will be limited to PC cards, headsets and other add-on cable replacement products, Frost & Sullivan said.
The numbers in Frost & Sullivan's most recent study have been revised down somewhat slightly from the company's January study, which predicted that Bluetooth would generate $2.5 billion of revenue in 2001, with 11 million products using the Bluetooth technology sold by the end of this year.
"The main reason for the change in those numbers is that the technology has taken significantly longer than anticipated," Wall said.
"The Bluetooth specification 1.1 was ratified by SIG (the Bluetooth Special Interest Group) in February and that should move things along now. We were very excited about the prospects of Bluetooth at the beginning of the year and we continue to be excited about them now," Wall said. Since the 1.1 specification was ratified, more than 100 products have been qualified, the study said.
More than 120 IT network managers in the U.S., Europe and Asia were interviewed for the study, which found that, while most respondents are clearly ready to use Bluetooth technology, there is some confusion about what Bluetooth actually is, Wall said.
"A majority of end users described Bluetooth as a wireless LAN, but that has a lot to do with who we interviewed: The people responsible for networks and for buying IT and network equipment. They have a tendency to focus on what they know best," Wall said.
At first seen by the industry as primarily a cable replacement tool, Bluetooth is being promoted by companies such as Microsoft Corp. as a viable option for wireless PAN products, but Wall said that Bluetooth is now seen as being "stretched into a wireless LAN" technology. "Bluetooth is never going to be a full wireless LAN, but it can be a complement to it, rather than a competitor," Wall said.