Global demand for wireless local area network (Lan) semiconductors remains strong, driven by technology advancements in 802.11 such as single-chip low-power devices and production of pre-N and draft-N chipsets.

Analyst firm IDC estimates that the worldwide wireless Lan semiconductor market will reach a value of $3.2bn by 2010, representing a compound annual growth rate of 17 per cent.

While industry-wide competition has continued to force prices down, opportunities "continue to abound" for wireless Lan chip suppliers, according to IDC.

The primary growth opportunity is in embedded applications such as mobile phones, and in select consumer electronic designs.

"To remain viable, chip vendors must think about wireless Lan as a portfolio technology that can complement products in broadband, wired networking, consumer devices, and PC or mobile device designs," said Celeste Crystal, senior research analyst at IDC's semiconductors group.

"By focusing on end markets and the ecosystem, wireless Lan chip vendors will differentiate products and drive pricing and product differentiation in the industry."