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Tuesday, 10 June 2008
Cost not apps will drive low power Bluetooth market… 

Although not expected to be specified until 2009, applications for low energy Bluetooth technology (a.k.a. Ultra Low Power/WiBree) have already been identified by the Bluetooth Special Interest Group (SIG) trade association. Among the SIG’s picks as tier one devices for Bluetooth low energy technology are sports and fitness, healthcare, the digital watch and mobile phones. However, in a new analysis, the IMS Research house is predicting that it will be the cost of the solution (or rather the lack of it) that will drive the market as opposed to the use cases, at least in the short-term.

IMS says that realistically, if it all goes to plan, and the specification is defined during 2009, we will see a small amount of silicon in Q4 2009. Considering design cycles and the like, IMS believe it will be 2010 before Bluetooth low energy-enabled devices get into the hands of the consumer.

The analyst notes that the industry is hoping that dual-mode (communicating with single mode ULP and traditional Bluetooth devices) and single-mode ULP Bluetooth devices come to market in sync. If this doesn’t happen (and there is a ‘chicken and egg’ situation) IMS believes that the quickest route to market for the technology is for dual-mode devices to be adopted first. “We already estimate that the ASP of a Bluetooth IC for a mobile phone is sub-US$2.00 in 2008. Where dual-mode ICs are replacing core Bluetooth ICs, we estimate volumes will increase exponentially,” states Fiona Thomson, research director for IMS’ Connectivity Group.

IMS reckons that single-mode devices are likely to be slower out of the traps and that this is related to market education (or lack of it to date): Bluetooth technology has not traditionally been used in heart rate monitors, cycling computers and watches and Bluetooth technology really took off when consumers started to demand the technology, when they started to differentiate between those handsets with Bluetooth technology and those without.

According to IMS it is education and retail promotion that will encourage consumers to go out and buy a single-mode device to work with their dual-mode device. “What we don’t want to see is a significant majority of consumers owning dual-mode devices and not taking advantage of the low energy part of the solution,” adds Thomson.

IMS believes that single-mode Bluetooth low energy technology uptake is partly dependant on the attach rate of dual-mode ICs to mobile phones. Manufacturers of potential single-mode enabled devices and proprietary IC vendors would like to see dual-mode Bluetooth ICs made compulsory, which would (after a transition period) eliminate core Bluetooth ICs. Should core Bluetooth ICs and dual-mode Bluetooth ICs merge into one, dual-mode will automatically become compulsory. However, this will be decided over time and is dependant on the uptake.

Blue swayed
In other Bluetooth developments the technology in general looks to be well on its way to becoming a worldwide household name. Last month, for example, on the tenth anniversary of its launch the Bluetooth SIG announced that global awareness of Bluetooth technology was at an all time high with 85 % of consumers recognising the wireless technology. This was the fifth consecutive year that awareness of Bluetooth technology had climbed, according to an annual survey conducted by research firm Millward Brown.

Consumers in China , Germany , Japan , Taiwan , the USA and UK said they had heard of Bluetooth technology and were also aware of the Bluetooth logo (68%) and products that use Bluetooth technology. Products consumers noted included: mobile phones (79%), headsets (61%), and computers (56%). In four out of the six countries polled, at least 60% of respondents claimed to own a Bluetooth-enabled device. Of those consumers who heard a lot about Bluetooth technology, 78% said they were willing to pay more for products that include the technology.

“The rise in popularity of Bluetooth technology over its ten year existence has been amazing,” comments Michael Foley, Ph.D., executive director of the Bluetooth SIG, a body made up of over 10,000 companies. “There are 2 billion devices with Bluetooth technology in the marketplace now. What started with mobile phones and headsets has spilled over into nearly every industry from gaming and cars to clothing and toys. Bluetooth technology is now an expected part of the average consumer’s lifestyle.”

Meantime, a new analysis from ABI Research – ‘Bluetooth: The Global Outlook’ - forecasts that close to 2.4bn units of Bluetooth-enabled equipment are expected to ship worldwide in 2013. Of these, more than half will be cellular handsets; adding the accompanying headsets brings that figure to more than 75% of the total market. Notebook computers and portable music devices will run a distant second and third, although the compound annual growth rate for the latter is by far the greatest of any product class.

ABI also reports that Bluetooth is showing up everywhere; in addition to phones, computers and musical devices, it can be found in PDAs, desktop PCs, Human Interface Devices (for example, keyboards and mice), printers, automotive products, add-in cards and dongles, digital cameras and medical products. That ubiquity opens up new opportunities: “Integration is a key trend in Bluetooth markets,” judges ABI Research senior analyst Douglas McEuen. “Designers are saying ‘Bluetooth is in everything, so what else can we add to the Bluetooth chip?’ GPS is a popular candidate, as is FM radio.”

Some forms of integration just add speed and range, such as the current development of ‘Bluetooth over 802.11’. It’s the same with ultrawideband: the Bluetooth SIG is working with the WiMedia Alliance to create a technology codenamed ‘ Seattle ’, which will also add UWB’s high speed capabilities to Bluetooth.

Gaming is another quite significant market for Bluetooth, although it is characterised by eccentric cycles of growth and contraction caused by the staggered 4 to 5 year generations of the three leading game consoles/remote controls.

“The big Bluetooth IC vendors – CSR, Broadcom, and Texas Instruments – remain the market leaders. And as they see OEMs moving to develop Bluetooth into a more capable solution, they are meeting that demand,” concludes McEven.
John Williamson 
 
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