Shake Out In WiFi Chip Market

As the WiFi technology matured, the technology enjoyed huge market acceptance, driving the economies of scale, and reducing prices on the chips. This is great for the consumer, and the world in general, but for companies that had bet their business on earning big margins in 802.11 chips, it was a kick in the pants. The Register has a great wrap-up of companies that are either dead, or are exiting the WiFi chip business – a business that is the victim of its own success. Isn’t it incongruous that nobody looks at all the gravestones on the WiFi chip lot and concludes that WiFi is dead, yet some analysts choose to point at Ericsson’s withdrawal from the Bluetooth chip business (while staying in the software business) as the death of Bluetooth. Nobody’s dying here: Both are just natural consolidations in maturing markets.

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