The need for enterprises to remain connected anywhere and at all times,
continued to drive the market for WLAN products during the last financial year.
According to V&D estimates, the WLAN equipment market stood at Rs 104.2
crore, as against Rs 82.5 crore in 2004-2005. While the demand for WLAN products
increased with simultaneous increase in number of units sold, the overall
revenue growth did not match up-thanks to the reduction in per unit price.
Cisco's revenue registered a growth of 9% with revenue of Rs 41 crore. This
has largely been possible due to the company's wide range of offerings,
coupled with its innovative strategy on the wireless front. This can be
attributed to significant reduction in price of products. Cisco's major
customer wins during 2005-06 included Wipro, GE call center, Infosys, Reuters,
ONGC and HLL.
D-Link regietered a revenue of Rs 26 crores. It sold a total of 40,000 units.
Other players with the potential to grow included Netgear, Dax, and Proxim.
Netgear recorded an impressive growth of 63%, securing the third position.
SMBs Show The Way
Not only large enterprises, even the small businesses and home segments
showed impressive growth during the year 2005-06. Today, one can easily buy
access points and other WLAN devices in an ordinary shop at major metros and
even smaller cities. This was coupled with the increase in number of hotspots
for WiFi access. Even service providers such as Bharti, BSNL and MTNL became
aggressive on offering WiFi services to their customers as value added services.
This was largely due to recent announcements by the government to de-license the
2.4 Ghz and 5.1 Ghz bands, on which the WiFi platform works.
The Drivers
The increase in demand for WLAN products can be attributed to proliferation
of mobile workforce, reduction in prices of equipment and end user access
devices. Above all, the inherent productivity benefits and efficiency that
wireless networks offer, was the most important factor that resulted in
significant growth of this segment.
|
The Top Players (FY
2005-06)
|
|
Rank
|
Companies
|
Revenue (in Rs Crore)
|
Growth
(in %age)
|
Market Share
(in %age)
|
|
FY 2004-05
|
FY 2005-06
|
|
1
|
Cisco
|
41
|
45
|
9.8
|
43.3
|
|
2
|
D-Link
|
22
|
26
|
18.2
|
25.0
|
|
3
|
Netgear
|
6
|
9
|
50.0
|
8.7
|
|
4
|
Dax
|
4
|
4
|
0.0
|
3.8
|
|
|
Others*
|
10
|
20
|
100.0
|
19.2
|
|
|
Total
|
83
|
104
|
25.3
|
100.0
|
|
Others include:
3Com, Brovis, Compex, Multitech, Allied Telesyn, Proxim
|
| V&D
Estimates
CyberMedia Research |
Security and QoS
Wireless LANs are prone to security threats, with increased incidents
of unauthorized access, breaking of encryption and loss of data integrity.
Except for some of the leading players, other vendors have not been able to
incorporate foolproof security based on accepted security standards. This is
resulting in security being a big challenge with WLAN for deployment by
enterprises. However, experts feel that with the 802.1x authentication, the
security challenge has been mitigated to a large extent.
Price
Average access point prices fell to around Rs 600 for the low-end segment.
The ones with security management features, centralized management features and
the wider range hovered at around Rs 2,500.
Outlook
With small enterprises realizing the productivity implications for their
business, this segment is slated to grow significantly. The actual number of
non-corporate individual users is still insignificant but a potential big
market. This market will grow significantly if the price of good configuration
laptops falls to sub Rs 30,000.
Sudesh Prasad
sudeshp@cybermedia.co.in
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