WLAN semiconductors become a billion dollar market

While wireless hotspots seem to be the order of the day at cafés within the UAE, the world’s current craze for all things without wires also has seen revenues within WLAN semiconductor market skyrocket.

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By  Matthew Southwell Published  July 2, 2003

While wireless hotspots seem to be the order of the day at cafés within the UAE, the world’s current craze for all things without wires also has seen revenues within the wireless local area network (WLAN) semiconductor market skyrocket. According to IDC, the global market will increase at a 13% compound annual growth rate (CAGR) from 2002 to 2007 and reach US$1.1 billion in revenues by 2007.

“The next several years are going to witness rapid development of a WLAN infrastructure, which in turn will generate considerable demand for WLAN semiconductors,” says Ken Furer, analyst with IDC’s semiconductor research program.

According to the analyst house, the high attach rate for embedded WLAN inside mobile PCs will remain the leading driver for shipment growth, while adoption in other consumer devices, including set-top boxes, DVD players and gaming consoles, will not drive demand. Overall, shipments will increase nearly five-fold over the forecast period and a whopping 114 million units will be shipped in 2007.

Despite this positive outlook, however, price erosion and market saturation will kick in and lead to industry consolidation. Furthermore, weaker suppliers will be weeded out as impressive RF performance and power management features prove to be the keys to survival.

“IDC expects the market will peak in 2005 as price erosion from aggressive competition and more advanced CMOS integration will begin to slow sales growth. The market will remain fairly flat throughout the rest of the forecast period as saturation is achieved in the key target applications,” comments Furer.

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