Improved security, notebooks with built-in Wi-Fi clients and an eventual boom in mobile VOIP (voice over Internet Protocol) around the office will cause the enterprise wireless LAN market to more than double in revenue by 2009, industry research company Dell'Oro Group Inc. predicted on Wednesday.
Wi-Fi adoption is growing beyond vertical industries such as health care, education and retail that have special requirements for wireless, said Dell'Oro analyst Greg Collins. Enterprises in general are starting to invest in Wi-Fi as the cost in client equipment declines and security and management headaches ease. The advent of built-in client gear in most notebook PCs, such as Intel Corp.'s Centrino chipset, has eliminated the cost of separate Wi-Fi cards and led employees to expect wireless capability, Collins said. Meanwhile, security and network management mechanisms have improved, he added.
The worldwide enterprise wireless LAN business will grow to US$3.5 billion in revenue in 2009 from an estimated $1.1 billion this year, Collins said. Enterprise wireless LANs are gradually evolving from independent access points to central wireless LAN switches with dependent access points, but current market leader Cisco Systems Inc. is keeping up with trends in the market through moves such as its recent acquisition of Airespace Inc., he said.
Meanwhile, in the consumer and SOHO (small office, home office) market, Wi-Fi is becoming an integrated feature in cable and DSL (digital subscriber line) modems, a change that could alter the landscape of a business dominated by Cisco's Linksys division, Collins said.
Dell'Oro also predicts wireless LANs will proliferate in homes, but expects most of them to show up in a broadband modem from a service provider. The company forecasts sales of 19 million wireless LAN devices this year (not counting client products), but says that will grow to only 25 million in 2009. Meanwhile, Dell'Oro expects service providers worldwide to ship 13 million broadband access devices this year that have wireless LAN capability built in, and by 2009 predicts 67 million such devices will go out to broadband subscribers. By that time, 70 percent of all broadband access devices will come with a wireless LAN function, Collins said.
That shift could lead to a shakeup among consumer wireless LAN vendors, according to Collins. The market for combined devices is led by vendors such as Zyxel Communications Corp., Siemens AG and D-Link Systems Inc., while Linksys lags behind in market share, he said. Linksys probably will have to develop stronger relationships with carriers to maintain its lead in consumer Wi-Fi, Collins said.