Rosy future for wireless Lan chip market

Increasing use of wireless networking capabilities in laptops and the accelerated deployment of wireless hotspots are creating healthy growth in the wireless local area network (Lan) semiconductor market, according to research.

IDC predicts the worldwide wireless Lan semiconductor market will increase at a 13 per cent compound annual growth rate from 2002 to 2007, reaching $1.1bn (£0.6bn) in revenues by 2007.

During the same period, shipments will increase nearly fivefold, reaching 114 million units in 2007.

Ken Furer, analyst with IDC's semiconductor research programme, said: "The next several years are going to witness rapid development of a wireless Lan infrastructure, which in turn will generate considerable demand for wireless Lan semiconductors."

The analyst organisation added that price erosion and market saturation will lead to industry consolidation towards 2005, as weaker suppliers are weeded out.

Worldwide Wlan Semiconductor Forecast and Analysis, 2002-2007 predicted that 802.11g "will take a big bite out of 802.11b sales in 2003", while dual and tri-band products (802.11a+b/g) will come to dominate the market by 2005.