Bluetooth "has come a long way from the simple cable replacement technology unveiled in 1998", a new study claims, predicting that 70 million chipset solutions will ship this year.
Frost & Sullivan`s market research points to a technology "[that has ridden] a roller-coaster hype curve and [struggled] to resolve the many technical challenges presented by such an ambitious vision", but now has an installed base of millions.
The originators of the report opine that it has entered the maturity stage of its lifecycle, sports a stable specification and has met with success in its install base. The authors state that interoperability between devices is "seldom an issue and interference with other radio technologies is a limited and increasingly disappearing concern". They say the growth in the semiconductor sector, "a hotbed of Bluetooth development, bodes well for continued buoyancy".
The year 2001 saw shipments of just under 10 million chipset solutions, while annual shipments had more than tripled to around 34 million units by 2002. In 2003, Frost & Sullivan expects that shipments will at least double, with a "conservative estimate of over 70 million units".
Not all plain sailing
The study admits that it has not all been plain sailing for companies operating in the semiconductor and subsystems space (including silicon vendors, software developers, intellectual property, modules and design houses). "Tough economic conditions and the resource demands of a challenging technology have forced a consolidation of the market," reports Frost & Sullivan consultant Carles Ferreiro.
Clearly identified market segments such as cellular phones and PC-based applications offer market potential, while emerging application areas such as industrial and automotive applications "will grow in importance and volume as time goes by". The study adds "there are no clear competitors to Bluetooth in the personal area networking space, as none have its scope, volume or maturity".
It warns that only development companies with a sound business plan and clear value proposition will survive. "Even some of the larger initial Bluetooth players have found the returns from Bluetooth to be too limited to justify continued significant involvement. Avaya, Intel and Motorola have all scaled back their initial interest as the technology changed from being the world-changing technological advancement it was heralded as, to a more realistic breakthrough in personal communications and networking."
Over the next few years, the company expects to see a further streamlining of the component end of the Bluetooth market, and semiconductor developers, protocol software developers and intellectual property developers are already feeling the contraction. The growth opportunity lies in emerging applications, but only those able to demonstrate competence in supporting client development will win.
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