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Wireless Devices To Lead The Way In Home Networking

Format battles are not unique in the PC industry. There are Apple Computer enthusiasts and Windows afficionados, and consumers favoring DVD-RAM over DVD+RW, but the once heated competition to become the primary home networking technology apparently has settled down with no clear winner or loser.

The three technologies now comprising the bulk of home networking sales are wireless, Ethernet and to a smaller extent HomePlug. The latter utilizes a home’s electrical wire power grid to transfer data. The general consensus among industry watchers is that instead of one becoming the dominant type all three can potentially coexist in the same home network as each is best suited for certain applications. This is a major about-face from what was thought just a few years ago when each company would push just one of the technologies. Now most vendors offer a mix of all three with the general idea that consumers will want to piece together home networks using different technologies.

Wireless networking is expected to make the most news this year. Networking based on the 802.11 specification, also known as WiFi, will play an increasingly important role, particularly among consumers interested in connecting a PC to their home A/V entertainment system, said Gemma Paulo, a senior analyst with In-Stat MDR, Scottsdale, Ariz.

She said two factors are boosting wireless’ popularity with consumers: the wide availability of a broad variety of low-priced products, and the incorporation of the specification into the Windows XP operating system. This was a logical course of action for Microsoft since it went into the wireless networking hardware business last September.

Paulo sees WiFi as the primary method used to connect a home’s two technology clusters: the PC and its host of networked peripherals and the A/V system. It will not be an umbrella system used to connect the various devices in each cluster. Instead a different networking technology probably will be used for this purpose. Whether that ends up being HomePlug, Ethernet, iLink or another proprietary type of networking technology is hard to distinguish at this point, she said, primarily because the various vendors are all over the map on the issue.

While connecting these systems will play an important role in the future, the primary application consumers are interested in is sharing broadband Internet access. According to an In-Stat survey posted last year, 42 percent of respondents wanted this, with 17 percent interested in sharing files.

The growth in the popularity of 802.11 products can be seen in In-Stat’s WiFi shipment forecast. It shows that about 6 million units shipped in 2002 with the total growing yearly until it reaches 33 million by 2006, according to In-Stat’s data. The majority of these units are 802.11b, but 802.11a devices are being snatched up with increasing speed by early adopters, she said.

Gartner/Dataquest said wireless networking products were one of the few bright areas for the technology sector in 2002, a trend that is expected to continue this year.

Worldwide wireless LAN shipments grew 73 percent in 2002, while revenue increased about 26 percent, according to Dataquest. The industry will continue this consistent growth in 2003, as worldwide wireless LAN shipments are expected to total 26.5 million units, up from 15.5 million units in 2002. Gartner analysts said the market will continue to experience healthy growth through 2007.

In-Stat’s WiFi shipment forecast, issued last November, shows the format’s popularity exploding. About 6 million units shipped 2002, but this should jump to 33 million by 2006, according to In-Stat. The majority of these units are 802.11b, but 802.11a devices are being snatched up with increasing speed by early adopters, Paulo said.

NetGear expects the primary networking focus to center on wireless. With this in mind it showed at CES last month the latest generation of wireless product to be built on the 802.11 specification. NetGear introduced a line of 802.11g products, including a PC Card, access point and router. This next generation technology has a potential data transfer rate of 54MBps and features better encryption and security. NetGear expects the products to ship during the first quarter of this year.

The one format that has fallen out of favor is Home PNA, which uses a home’s telephone wires to transmit data between computers and devices. Doug Hagan, marketing communications manager for NetGear, said the company still has one Home PNA-based model on the market, but did not expect it to remain for sale.

“These have really fallen off and are now kind of a niche,” he said.

New varieties of wireless networking are on the horizon. These should be added to the 802.11 specification in the next few years. Ultra-Wideband (UWB) for video distribution could be included as soon as this year It can offer higher throughput speeds, but at a shorter range. UWB could potentially shift consumer’s interest in wireless networking away from sharing Internet access to sharing streaming video, Paulo said. Another, called Zigbee, is for the CE, home automation, lighting and security markets. Supported by the Zigbee Alliance, the technology should provide a battery life of six months to two years using just 2 AA batteries.