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Thursday, August 18, 2005
Wi-Fi Chip Market From $900 million in 2004 to $2.1 billion in 2009

Power amplifier modules emerge as Wi-Fi growth continues.

New applications, competition and technology developments are expected to propel the Wi-Fi chip market from $900 million in 2004 to $2.1 billion in 2009, according to "Wi-Fi Component Forecast and Vendor Share," from Strategy Analytics. The continuing reduction in Wi-Fi radio chip prices, increasing integration and adoption of front-end PA modules, will help drive Wi-Fi into an ever-increasing number of platforms. Although demand from notebook computers currently accounts for the majority of chip shipments, by 2009 Wi-Fi enabled cell phones will dominate.

The power amplifier market is experiencing one of the most heated technology races in Wi-Fi. GaAs, with its low power consumption and ability to provide good performance at 5 GHz leads this segment. With SiGe's potential integration and cost advantages, SiGe vendors have made inroads against GaAs at 2.4 GHz, and will continue to push this technology over the next five years in crucial, high value power amplifier and front-end module markets.

"Several SiGe and GaAs power amplifier vendors made dramatic inroads against better established Wi-Fi power amplifier vendors in 2004 with the introduction of front-end modules incorporating filters, switches and power amplifier chips. We believe that the simplicity of modules for system makers means that this trend will continue," says Asif Anwar, director of the Strategy Analytics GaAs Program.

Despite the opportunities for Wi-Fi chip makers, this report makes sobering reading for vendors. "Broadcom, Atheros and Intel presently control over half of the Wi-Fi chip market," states Chris Taylor, Director, Strategy Analytics' RF & Wireless Component service. He adds, "The number of vendors has fallen dramatically over the past two years, but we count at least 58 players still in this market, which is still far too many. We only expect around 20 to survive the next five years."

The report contains an analysis of Wi-Fi volume by application, forecasts by technology and vendor market shares for Wi-Fi chipsets and PAs.

Source: [Strategy Analytics]

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