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Intel, Nokia partnership ups ante for wireless laptops, says ABI

Posted: 04 Oct 2006 ?? ?Print Version ?Bookmark and Share

Keywords:ABI Research? Nokia? Intel? wireless internet?

The announcement of Intel and Nokia's partnership to offer embedded wireless Internet connectivity in laptops not only changed the market outlook for embedded cellular modems in portable computers but also hit the share prices of competing wireless modem makers Novatel Wireless and Sierra Wireless.

"The Nokia/Intel partnership to produce an embedded HSDPA Mini-card modem will not only accelerate the market for cellular connectivity in notebooks," said ABI senior analyst Philip Solis. "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-factorsPC 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, the real future of the market lies with embedded modems which will make up nearly 17 percent of the total this year. That proportion will increase steadily over time, ABI said.

Falling ASPs 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, as detailed in a recent ABI study. The growing revenue from cellular PC modems is the result of shipments growing steadily, and increasingly, and the shipments of the more expensive 3G modems.

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 study's forecast period. But even that decline will be insufficient to dent the revenue growth for vendors such as Option NV, Novatel, Sierra Wireless and Sony Ericsson, resulting from higher shipment volumes and a greater proportion of 3G modems.

Most of the growth in this market will, not surprisingly, 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, ABI added.




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