Wi-Fi Revenues Grow, Prices Drop

According to a new report, Wi-Fi revenues grew by 15 percent last year. Findings show that Cisco and Linksys dominate a market that's evenly split among enterprises and consumers.

By Michael Hall | Posted Feb 24, 2005
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A new report by Infonetics Research shows a 15 percent leap in worldwide Wi-Fi revenues from 2003 to 2004. The big winner in the market, expected to continue growing through 2008, was Cisco.

According to Infonetics quarterly report, Wi-Fi revenue reached $2.8 billion in 2004. Unit shipments reached 36.1 million. The growth is part of a larger trend expected to go on until 2008, when the research firm predicts unit shipments will reach 80.4 million, for a 123 percent increase over last year.

"In 2004, wireless LANs emerged from a niche technology to become part of the IT mainstream, as well as a complement to other networking and wireless technologies," said Richard Webb, directing analyst at Infonetics and author of the report. "Competition has increased, driving prices down and spurring on further innovation in the market as wireless LANs continue to gain acceptance."

That competition explains another finding in Infonetics' report: Quarterly revenue results showed a 21 percent drop between the third and fourth quarters of 2004. Access points, wireless broadband gateways, and NICs all showed decreases in prices, especially in 802.11b-based equipment, which was overshadowed by the launch of 802.11g.

The big winners in the wireless market were Cisco, which holds 17 percent of the market, and Cisco-Linksys, which holds 15 percent. The even split between enterprise-oriented Cisco and its consumer-oriented subsidiary was broadly reflected by the overall composition of the market: Infonetics reports SOHOs and consumers account for 52 percent of the revenue, while enterprises and service providers account for 48 percent.

D-Link and Netgear came in third and fourth respectively. Other wireless players included Buffalo, Symbol, 3Com, ZyXEL, US Robotics, and Proxim, with single-digit shares.

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