Stimulus bill to provide 'windfall' for wireless providers, ABI projects

By , Network World |  Mobile & Wireless, economic stimulus

The economic stimulus package passed earlier this year will provide a $6.8 billion windfall to the wireless communications industry, projects ABI Research

In a report released Tuesday, ABI says the government will spend $6.8 billion for "wireless communications upgrades and new deployments" over the next two years, thus providing "a significant one-off opportunity for wireless equipment vendors."

ABI analyst Stan Schatt estimates that roughly $1.07 billion of the money will be spent on upgrades or deployments of Wi-Fi services.

Schatt says Wi-Fi will be the technology of choice for several government projects that are part of the stimulus package, including transport of customer data for smart grid projects dedicated to upgrade the U.S. electricity system. Schatt also says Wi-Fi will be used to deploy wireless security cameras for port security upgrades and for deploying wireless Internet services to schools as part of modernization projects. Other uses for Wi-Fi services will include Wi-Fi-enabled mobile devices and sensors to help link healthcare networks up with telepresence, wireless LANs and video surveillance systems, ABI says.

"Right now vendors are calculating what the total market is for their products and are working with municipalities to help them write grants to get this money," he says. "There's a lot going on behind the scenes to get a hold of this money. The numbers are really astronomical, particularly because several vertical markets for Wi-Fi will be in decline because they have been hit so hard by the recession."

In addition to money for Wi-Fi deployments, Schatt also thinks that the stimulus package will benefit companies that develop wireless sensors, as the stimulus package's "green buildings initiative will require a lot of building automation sensors to communicate wirelessly." ABI Research estimated the total amount of money spent on wireless communications by looking at various projects within the stimulus package and tallying up how many of them would require the deployment of Wi-Fi or other wireless services.

In terms of overall Internet deployment, the government allotted $7.2 billion for broadband deployment in the American Recovery and Reinvestment Act of 2009, although the bill did not specify what sort of technology the money should be spent on. Rather, it will enable tech companies, telecom companies and ISPs to compete for broadband grants that will be administered by both the National Telecommunications and Information Administration and the U.S. Department of Agriculture. Analysts have expected that wireless broadband technologies will play a major role in any national broadband infrastructure because of their ability to cover large areas with a single base station, thus providing a more cost-effective alternative to deploying fiber-to-the-home in sparsely-populated areas.

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