State of the Wireless LAN Industry


Mack Sullivan, Director 1998

Outline

Wireless LANs Poised for Tremendous Growth
Imagine responding to email messages from a hammock in your backyard, or accessing your company�s Intranet from any location within your company. These scenes may become commonplace over the next five years as wireless LAN adoption continues its rapid expansion, growing from its solid base of data collection applications today, to the much larger opportunities represented by office and home applications tomorrow.

The wireless LAN industry has grown at a notable rate of between 40 and 60% per year for the past five years and the industry revenues in 1997 exceeded $300 million. According to the market research firm InStat, the wireless LAN market will be as large as $1.1 Billion by the year 2000.

Wireless LANs connect users within a building or local campus area using radio signals to send data, rather than wire. The focus on local coverage is an important distinction from the many wireless Wide Area Networking solutions that transmit data across broad coverage regions using either cellular or satellite technology. Wireless LANs operate under FCC rules similar to rules for cordless telephones used in the home. Data transmission is free, just like the voice transmission from your cordless phone to its base station.

Current wireless LAN applications
In an adoption pattern typical of technology products, early adopters, primarily in vertical markets, have discovered the benefits of wireless LANs and implemented solutions that give them significant business advantages. With architecture resembling the familiar architecture of a wired LAN, and the advantage of true mobile connectivity, wireless LANs have already become profitable mainstream technology in certain applications. Now that the technology has proven itself in some difficult environments and the use of notebook computers has become common, wireless LANs are appearing in a wider variety of specialty and general-purpose applications. The table categorizes wireless LAN applications by their current penetration within their application segments.

Acceptance of Wireless LANs

Mainstream Burgeoning Anticipated
Data Collection Bedside Monitoring Project Team Setup
Inventory ER Check-in Virtual Offices
Point of Sale Financial Trading Consulting Teams
Hard-to-Wire Buildings Cargo Tracking On-Site Training
  Outdoor Events Mobile Intranet
  Hospitality Check-in Customer-Ready Rooms
  Student Networking Home Networking

Companies in manufacturing, warehousing, and retail have made productivity and service gains by using hand-held terminals and portable computers to transmit real-time information to centralized hosts for processing. Factory workers with bar code scanners, waitresses or rental car customer representatives with computing tablets are leveraging the benefits of mainstream wireless LAN technology. Another accepted application of wireless LANs is to establish network connectivity when wired networking proves costly or impossible, such as in historic buildings or on space shuttle flights.

One of the fastest growing applications for wireless LANs is in the health care industry. Doctors and nurses are making increasing use of wireless LANs to have access to complete patient information at their fingertips. Education is another high growth segment for wireless LANs. Students at universities are finding that wireless LANs provide them with Internet and Intranet access across the campus.

Access to the network is not the only reason for industry growth. Wireless LANs also make network configuration more convenient. A wireless branch-office LAN is more flexible than a wired LAN, and is easier to set up. A network manager can completely configure, deploy and redeploy a wireless LAN without ever going on site.

Some of the same productivity benefits that wireless LAN users have discovered in manufacturing, health care and universities are making their way to the corporate market. With wireless connectivity to a wired network, mobile users can pick up e-mail or connect to the company's Intranet quickly and easily, from anywhere in the company. Small gaps of time that were previously unproductive can be used for communicating or retrieving useful information.

Wireless LAN technology may even find its way to the home. Many residences now have multiple PCs, and as higher speed Internet access becomes commonplace, people will look for ways to connect multiple computing devices to shared resources like the Internet. A wireless LAN is particularly appealing when the alternative is drilling holes in the walls.

Growth Factors
There are at least four reasons why the wireless LAN market is expected to exceed $1 Billion by the year 2000

First, a long awaited wireless LAN standard was recently approved by the Institute of Electrical and Electronic Engineers (IEEE). The IEEE 802.11 committee, a subgroup with the IEEE, has been working on an industry-wide, vendor-independent standard for wireless LANs for seven years. In July 1997, IEEE 802.11 was adopted as a worldwide ISO standard. The standard assures users of stable technology and more competitive bidding.

Second, product prices have decreased dramatically over the past year. The reductions are a result of competition for standards based product, the maturity of the technology and increased product volume and have helped cost justify wireless LANs in more applications.

Third, new wireless LAN applications are continually being adopted. Schools are evaluating this technology for use in classrooms. Auditors and consultants are beginning to carry wireless LAN equipped laptops to their assignments so they can quickly setup their own networks within a client�s facility. Offices are evaluating the use of wireless LANs for Internet and Intranet access for employees requiring real-time access to information. These applications share the benefits of improved productivity, or efficiency that comes from providing individuals with the flexibility to move freely within their work environment, while maintaining the ability to send or retrieve information.

Fourth, the mobile computer paradigm is changing with more corporate and individual reliance on mobile computing platforms. Individuals are using notebook computers as their primary computers and handheld platforms are gaining popularity in the workplace

The convergence of these growth factors combined with the underlying strength of the wireless LAN industry will spur additional uses and increased purchases of wireless LAN solutions. Cordless phones seemed like extravagant purchase until users discovered the value of local mobility. Wireless LANs provide these mobility benefits for data. While it is unlikely that wireless LAN devices will become as common as cordless phones, all the indicators point toward an industry poised for tremendous growth.

About the Wireless LAN Alliance (WLANA)
WLANA is a consortium of wireless LAN vendors formed to provide ongoing education about current applications of wireless local area networking and the future of the industry. WLANA is committed to establishing the wireless LAN as a key component of local area networking. To that end, members provide a clearinghouse of information on industry-related resources, current and emerging applications and future capabilities of wireless LANs. You can find all of this information, along with a list of the leading companies in the wireless LAN industry and links to their web sites, on the Wireless LAN Alliance web site:www.wlana.com

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