As Bluetooth-enabled products continue their slow introduction into the marketplace, a new study by Frost & Sullivan forecasts global shipments of Bluetooth products to reach more than 11 million units by the end of 2001, equaling $2.5 billion in revenues.
“Although the delays in the development of Bluetooth are beginning to prompt a backlash from certain sections of the media, industry observers have to take the infancy of Bluetooth as an industry standard technology into consideration when assessing the status of this marketplace,” said Michael Wall, research analyst with Frost & Sullivan. “Apart from [L.M.] Ericsson, the original pioneers, even the most progressive developers were not attracted to the project until 1998.”
The study noted the waves of hype surrounding Bluetooth have become part of a vicious cycle in which expectations are continually raised, placing additional pressure on developers to deliver, and causing greater delays in the introduction of Bluetooth products. These raised expectations have seen Bluetooth start as a simple cable replacement technology and evolve into a complex wireless local area network technology.
With these expectations have come comparisons with already established, and more advanced, wireless LAN technologies, including 802.11a and HomeRF standards. These standards operate in the same 2.4 GHz frequency range as Bluetooth, but provide throughput in excess of 10 megabits per second, compared with Bluetooth’s 1 Mbps.
Frost & Sullivan also pointed out another issue holding back the development of Bluetooth is an evolving standard’s issue complicating the certification process.
The Bluetooth Special Interest Group, made up of more than 2,000 companies including wireless heavyweights Ericsson, Motorola Inc. and Nokia Corp., has only ratified the 1.0 standard for certification. However, most of the companies are already working on the Bluetooth 1.1 standard for commercial deployment, which is not set for certification until later this year. Further complicating the issue, some developers have been discussing future Bluetooth standards before the current ones can be implemented.
These varying standards could lead to Bluetooth not being able to perform its most basic function of complete interoperability between devices.
“Other mobile communications technologies such as [GSM] took longer to develop than is being allowed for Bluetooth,” Frost & Sullivan’s report noted. “This is compounded by the fact that some developers are already discussing the second specification of the standard, Bluetooth 2.0, before the first generation has had a chance to flourish.”
One stabilizing force on the Bluetooth world could come from the Institute of Electrical and Electronic Engineers and the establishment of its 802.15 standard for personal area networking and principal driver behind the future uniformity of the technology. The IEEE has used its influence to back the rise of 802.11a as a networking standard and could do the same for Bluetooth.
While Frost & Sullivan predicts Ericsson will secure the early market place leadership position in Bluetooth-enabled products, other large players will be well positioned to perform strongly.
“Promoter group members Ericsson, Motorola and Nokia have all announced mobile-phone product launches during 2001,” Wall said.
