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Wireless LAN market strengthened by enterprise-level sales

The wireless LAN market is being driven by a recent increase in equipment sales as more enterprises deploy full-scale wireless LANs.

More workers will soon be able to work untethered, if wireless LAN equipment sales are any indication.

According to Infonetics Research's recent Wireless LAN Equipment quarterly market share report, revenue from global WLAN equipment topped out at $2.8 billion in 2006 -- showing an 18% increase over 2005. Sales of wireless LAN switches were especially strong, with a 27% revenue increase for 2006.

Organizations are learning to leverage high-speed connectivity with mobility in the workplace, meaning wireless LANs continue to penetrate all sectors.
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Perceived early on as a valuable tool in the education and healthcare industries, where workers are typically not tethered to a desk and have a ready-made need for it, wireless capability is beginning to spread rapidly throughout corporate workplaces. Infonetics Research's recent report found that revenue for enterprise-grade WLAN equipment in 2006 was up by 24%. Strong growth is expected to continue, with revenue increasing by 51% and reaching $4.3 billion by 2010.

Helping fuel this growth, a number of enterprises are reconsidering the benefits of wireless capabilities. Until recently, enterprises traditionally delayed deployment or set up only limited wireless connectivity within common areas because of the contentious nature of early wireless deployments. Many are now reversing their decision and actively considering the benefits, such as allowing workers to remain connected even when they are away from their desks.

With more wireless LAN switches readily available and more users competing for wireless bandwidth, businesses are considering full wireless deployments to be both possible and necessary. Enterprises are finding that wireless connectivity is a useful business tool -- employees are continuously connected and log less downtime, boosting worker productivity rates. Research documenting this increase in worker productivity is convincing executives of the benefits of a full wireless deployment.

With wireless LAN switches giving corporations the control to effectively manage bandwidth demands and traffic and to provide coverage between access point coverage areas within a building, issues that previously deterred enterprises from full wireless deployment are now being resolved. Infonetics Research's study also found that access points are boosting WLAN equipment revenues, representing 78% of sales in the fourth quarter of 2006.

The soft benefits of wireless deployments are also compelling enterprises to consider how they can best utilize such a system, including creating a more flexible office infrastructure and hot-desking, reducing unoccupied desk space and overall rented office floor space.

"Organizations are learning to leverage high-speed connectivity with mobility in the workplace, meaning wireless LANs continue to penetrate all sectors," said Richard Webb, wireless analyst at Infonetics Research.

Phones and handsets will also play a role in deployment of wireless LANs. As workers become more mobile, wireless device usage will continue to grow -- in particular, the use of PDAs, which let users go beyond the portability provided by laptops and allow them to explore true mobility. VoIP and Voice over WLANs will further fuel the drive to deploy wireless LANs.

Overall, Cisco continues to lead the market in enterprise-level wireless LAN equipment sales. But Webb said that market revenue is expected to grow following the approval of 802.11n as another industry standard, as organizations go through any necessary replacement purchasing.

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