In our view, 11g is unlikely to become dominant, though it will play a role. That's because by the end of 2003 you'll be able to purchase commodity WLAN NICs for less than $100 that will support 11b, 11a and 11g, automatically selecting the best system available. And you're also likely to see NICs that combine WLAN radios with 2.5G cellular radios, providing roaming between WLANs and emerging GPRS (General Packet Radio Service) and CDMA (Code-Division Multiple Access) 2000 1XRTT wide area cellular systems. The key technical challenges will rest in facilitating rapid and transparent roaming, maintaining security and dealing with the billing issues where commercial wireless networks are involved.
Embedded Wireless Everywhere?
While most people view wireless networking as a system add-on, a notable trend in 2003 will be toward embedded wireless capabilities, particularly in notebooks and PDAs. Informal estimates suggest that approximately 20 percent of enterprise-oriented notebooks purchased in late 2002 were shipped with embedded 802.11b WLAN capabilities. Look for that number to increase to well over 50 percent in 2003, eventually culminating in wireless availability on all high-end systems. From a manufacturing standpoint, companies reach a point where it costs more to leave wireless out than it does to build it in. By early 2003, notebook manufacturers will be able to include integrated 802.11a/802.11b WLAN support for no more than $25 extra. At that price point, most notebook manufacturers will include it, just like they did with Ethernet.
The PDA market is a little less clear in this regard. You'll certainly be able to purchase an increasing variety of devices with embedded WLAN and Bluetooth support, but the integration challenges are more complex. There are both form-factor and battery issues to deal with, and while we don't expect any breakthroughs in 2003, we'll certainly see some progress. Longer term, we're looking for innovations in both battery design and wireless radio power design, the goal being to meet expectations of users accustomed to being able to use their cell phones for at least a couple of days without recharging the batteries.
You can also expect to see wireless capabilities embedded in many other devices, mobile and otherwise. Telematics solutions will become more pervasive in automobiles, with smarter wireless capabilities providing new and unique mechanisms for enhancing transportation efficiency. Wireless will facilitate hands-free phone communication and vehicles will become capable of communicating on their own, to improve logistics efficiency or to automatically report impending mechanical problems. And everything from home appliances to manufacturing infrastructure systems will gain new wireless capabilities, with advances in technology likely outracing those in applications.
Mobile Devices Mature
While debates continue to rage regarding the ideal mobile computing device, a quick reality check reveals that the stodgy old notebook remains king. Even as we see slimmed-down notebooks that pack a slew of features into a sub-5-pound package, we'd argue that the notebook is more a portable device than a mobile device--a mini desktop you can transport from location to location rather than something that facilitates spontaneous access to information. The vast majority of mobile professionals can't get their work done without a notebook.
In 2003, however, we do expect to see a modest increase in the number of people who compute on the go without a notebook, a development made possible by an increasing array of highly functional handheld devices. While these products have significant long-term promise, we don't expect the new "tablet PCs" to make much headway in 2003. Not only are these devices expensive, they are also version 1.0 releases. Some IT professionals will evaluate and perhaps deploy them for niche or pilot applications, but most will wait awhile.
More intriguing are developments in the PDA and smartphone markets. Palm now has a credible enterprise platform that will let it compete with devices running the Pocket PC OS. At the same time, Pocket PC continues to mature, with enhanced performance, embedded wireless capabilities, a broader array of applications and development tools, and prices about half what they were a year ago. In addition, you'll see improved application integration capabilities and significant enhancements to back-end management platforms, from vendors that specialize in mobile device management as well as from more established desktop management vendors looking to broaden their markets. Gartner projects that it will grow from a $135 million market in 2000 to almost $750 million in 2005. Increased volume and competition are likely to make these platforms significantly more affordable, meaning 2003 may be the year when PDAs become EDAs (enterprise digital assistants).
We'll also see significant developments in the smartphone market. Phone manufacturers will add more data capabilities while PDA vendors will add telephony features. Many purists will still insist on choosing the best phone and the best PDA and integrating them via Bluetooth technology, but we think the smarter play is an integrated device. While the need to provide a reasonable screen may force smartphone vendors to maintain a larger footprint, we expect these devices to get thinner in the coming year, making them acceptable even to those who prize portability above all else.
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