Intel, Nokia Partnership Changes Wireless Market
By Colleen Taylor -- EDN, October 2, 2006
Intel and Nokia's impending collaboration to offer embedded wireless Internet connectivity in laptops has both changed the market outlook for embedded cellular modems in portable computers and affected the share prices of competing wireless modem makers Novatel Wireless and Sierra Wireless, according to the latest report from market research firm ABI Research.
In an announcement last week at the Intel Developer Forum in San Francisco, Intel said that Nokia had developed an HSDPA connectivity module for 3G notebook computers.
"The Nokia/Intel partnership to produce an embedded HSDPA Mini-card modem will not only accelerate the market for cellular connectivity in notebooks," ABI Research's Senior Analyst Philip Solis said in a statement this morning. "Intel is also taking a first step towards the eventual inclusion of WiMax wireless broadband in portable computers. The eventual goal is to offer multiple connectivity options."
Cellular modems for laptops come in two form-factors: PC cards and embedded modems such as the ones Intel and Nokia plan to offer. While PC cards will continue to be sold on an aftermarket basis for some time, particularly for new air interfaces, ABI said the real future of the market lies with embedded modems which will make up nearly 17 percent of the total this year—a proportion, the firm said, that will increase steadily over time.
Falling average selling prices (ASP) and increasing shipments mean that 2006's expected $1 billion revenue from cellular PC cards and embedded modems in laptops will increase to nearly $3 billion in 2010, the firm reported. The growing revenue from cellular PC modems is due to the steady growth of shipments and the increasing popularity of more expensive 3G modems, ABI said.
ASPs for both forms started to decline this year, and will continue to show a gradual, almost flat rate of decrease through the end of the 2011. But ABI said that the decline will be insufficient to dent the revenue growth for vendors, resulting from higher shipment volumes and a greater proportion of more expensive 3G modems.
Most of the growth in this market will be seen in North America and Western Europe, the regions with by far the highest penetration of laptop computers and the greatest number of businesses prepared to pay the typical $60 per month Internet access fees, the firm stated.
The market boom for higher-end electronics is not just in the laptop sector. According to a recent study by market research firm IDC, converged mobile device (smartphone) shipments have also hit a new high of late, nearing the 20 million mark in Q2.
