Fairly interesting reading, I meant to post sooner:
56K modem wars: x2 modems ramp to 33% of market ...
Business WireMonday, June 16, 1997 7:35:00 AM
56K modem wars: x2 modems ramp to 33% of
market but K56flex to dominate
Business Editors/Computer Writers
TEMPE, Ariz.--(BUSINESS WIRE)--June 16, 1997--
Marketing battle over 56 kbps technology is over.
The winner is the standards process.
Research results support stronger role for
programmable DSP technology in modem market.
Forward Concepts Monday announced that it has updated its
forecast of the "high performance modem market" (V.34 and above) and
has determined that the K56flex group will dominate, with a
forecasted 65% of the 56K modem chip unit shipments this year,
although x2 will gain market share to a forecasted 33%, primarily by
Texas Instruments at the expense of market leader Rockwell
International.
The remaining 2% will be based on intellectual property from
other 56K schemes.
The recent review of the modem market suggests that the two real
winners in the current 56K modem wars are 1) the standards process
and 2) the commitment to advanced programmable DSP technologies to
provide users with features, performance, and upgradability insurance
against future obsolescence.
"While the recent marketing battles between opposing 56 kbps
modulation schemes have stymied buyers with fear, uncertainty, and
doubt, the mist is beginning to lift off the modem miasma," said
Will Strauss, president of Forward Concepts, an electronics market
research firm.
It is clear that customers want standards, and that in the end,
the vendors need standards support in order to be able to sell
products.
"Without standards there is no interoperability, and without
interoperability, there is no market," added Strauss.
Forward Concepts is pleased to see the ITU Study Group 16 put the
56K standards issue on a fast track, with the goal of determining a
56K standard this year.
By using new, more powerful, and programmable DSP architectures,
modem vendors can provide their customers with a solution that can be
upgraded in the field.
"The 56K issue has really highlighted the benefits of a
programmable DSP architecture," said Strauss.
Forward Concepts expects the ITU Recommendation to include
elements of both the Lucent/Rockwell-backed K56flex product and
U.S. Robotics/Texas Instruments-backed x2 design.
"Hence, at this point every vendor should assume that the
impeding ITU standard will require his customers to upgrade,"
Strauss added.
Programmable DSP designs meet this need very well, since software
can be downloaded to change the modem's operation to conform to the
future standard.
Forward Concepts believes the market transition to 56K modems
will be very swift once the "holy wars" between x2 and K56flex
subside.
"Only Texas Instruments and Lucent were shipping 56K modem chip
sets in the first quarter, both eroding Rockwell's market share,"
commented Strauss.
"Each modem chip vendor is strong in different markets and
channels-with Lucent leading in direct sales to PC vendors (notably
Compaq and Toshiba), TI leading in store purchases (mostly through
USR) and Rockwell in remote access equipment (like Ascend )."
The adoption of a 56K standard will dissolve the differences
between the competing camps, but will bring on increasing
competition, trimming margins next year. But, the availability of
standards-backed 56K will spur more users to abandon their older
14.4 kbps and 28.8 kbps modems for the newer technology, giving the
modem market a renewed burst.
"Although few will ever see downstream data rates above 48 kbps,
by the end of the year virtually all V.34-class modem shipments will
support 56K technology," added Strauss.
With the explosion in Internet activity and on-line awareness,
the remote access slice of the modem pie has expanded. This is
especially significant when it comes to 56K modems because the remote
access devices are different from the client modems.
This has put some pressure on the internet service providers, who
want to stay competitive, but don't want to invest in new hardware
that doesn't yet benefit the majority of their users.
Nevertheless, equipment vendors such as Ascend, Livingston,
MultiTech, and U.S. Robotics are benefiting from the expansion of
remote access customers. This segment now represents 7% of the modem
unit market, up from 4% last year. For this customer class,
upgradability is of paramount importance.
Advanced programmable DSPs are likely to impact the future of the
modem market by being able to support multiple types of modulations
beyond analog 56K, including HDSL/SDSL and even ADSL.
The recent announcement by U.S. Robotics of a single modem which
will support both analog 56K and ADSL is an example of the modem
future. Such a device, promised for early 1998, is nearing the goal
of "the last modem you'll ever need to buy."
The programmable DSP engine employed by USR is powerful enough to
run many types of communication modulations and protocols and should
protect a user against future obsolescence. The Texas Instruments
TMS320C60 DSP chip employed by U.S. Robotics is well suited for this
purpose, and Forward Concepts believes that competing DSPs will soon
be announced by Lucent and Motorola.
Forward Concepts is a 12-year-old electronics market research
firm which specializes in markets driven by DSP technology, including
digital wireless, digital audio/video, videoconferencing and
multimedia. The company's flagship 500-page report, "DSP Strategies
2000" covers virtually all markets driven by digital signal
processing-with over 40 different markets forecast.
Included are market projections through 2001 for programmable DSP
chips and the even larger market for function-specific DSPs, like
modem chips, MPEG decoders and ADSL devices.
"DSP Strategies 2000" is available for $3,750.00 from Forward
Concepts, 1575 W. University Dr. #111, Tempe, AZ 85281,
Tel: 602/968-3759, Fax: 602/968-7145, e-mail: fc@@fwdconcepts.com .
Detailed descriptions of this and other studies are available through
free brochures and on the company's web page at
fwdconcepts.com .
--30--sig/ix*
CONTACT: Forward Concepts, Tempe
Will Strauss, 602/968-3759
KEYWORD: ARIZONA
INDUSTRY KEYWORD: COMED COMPUTERS/ELECTRONICS
INTERACTIVE/MULTIMEDIA/INTERNET TELECOMMUNICATIONS
Copyright 1997 Business Wire. All rights reserved. |
