Price cuts helped WLANs rebound in Q2

Lower prices helped sales of wireless LAN equipment based on the IEEE 802.11 standard rebound in the second quarter of this year in the U.S., according to research by Dell'Oro Group Inc.

Revenue from sales of WLAN equipment, including access points, broadband gateways and network interface cards using both the 802.11b and faster 802.11a standards, grew 8 percent from the previous quarter to US$380 million, Dell'Oro said in a statement Thursday. Both the enterprise and SOHO (small office-home office) segments showed revenue gains.

Though relatively small, the WLAN market grew more strongly in the quarter than did sales of traditional wired Ethernet switches. Revenue for the wired products, which included conventional switches as well as ones with Layer 3 routing and other advanced capabilities, grew just 3 percent overall from the previous quarter, according to the statement. It totaled US$2.7 billion, including both large enterprise and small and medium-sized business products.

A 13 percent drop in the average selling price for enterprise WLAN access points, the hubs that exchange packets from end users, helped reverse a decline in enterprise WLAN revenue in the previous quarter. Vendors cut prices to stimulate demand, according to Dell'Oro. Wireless LAN sales had taken a slight dip in the first quarter, to $352 million from $363 million the previous quarter, probably because of a seasonal dip in enterprise spending, according to Dell'Oro, based in Redwood City, California. Cisco Systems Inc., the biggest seller of 802.11 gear, gained more market share, seeing its revenue grow twice as fast as the overall market, at 16 percent, according to Dell'Oro. Linksys Group Inc., Buffalo Technology (USA) Inc. and D-Link Corp. followed Cisco in market share and none saw its revenue change by more than 3 percent from the previous quarter. NetGear Inc., the fifth-largest seller of 802.11 equipment in the quarter, saw revenue grow 111 percent.

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