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To: cfoe who wrote (53118)	11/21/2002 12:40:40 AM
From: Eric L	Respond to of 54805

cfoe, re: The Intel Gorilla of ... Question - How can any company be a Gorilla in WiFi if they can't control the market? Here's one gonna try: >> "Intel Inside Wi-Fi" ARCchart BluePrint 20 Nov 2002 In the first quarter of 2003 Intel will debut Banias, its next-generation mobile processor platform. This not only marks the chip giant’s latest defence of the notebook space, the primary market for Banias, but also its move into the 802.11 wireless networking (Wi-Fi) semiconductor market. Accompanying Banias is Intel’s dual-band Wi-Fi chipset, codenamed Calexico. With Intel’s market dominance, this has implications for the size and characteristics of the wireless LAN sector, and will have a serious impact on current chipset and equipment vendors who face an assault on their market. The Banias platform is a sub 2GHz processor optimised for mobile use and is due to ship in the first quarter of 2003. It has low power consumption, a small footprint, and advanced heat dissipation. According to Intel, notebooks based on the platform will run for 6 hours or more. Most significantly, Banias has 802.11a and 802.11b wireless networking support embedded at its core. Calexico is the dual-band chipset that has been specifically developed to leverage this functionality. Calexico and Banias are meant to fit together as the perfect notebook PC couple, and the two have been tested and optimised for each other. Vendors designing their notebooks around the new platform face a simple choice – use the Calexico chipset, or extend time and cost of the hardware qualification process by instead employing a competing wireless semiconductor solution. According to Anand Chandrasekher, Vice President of Intel’s Mobile Products Division, “We design all of these things to work together. Next year over 50 percent of the notebooks will be configured with wireless, and 80 percent of the Banias notebooks will have dual-band wireless”. If Chandrasker’s forecast are accurate, then a sizeable portion of that 50 percent will have Calexico inside – *this is after all Intel, the past master at exploiting its market dominance and bundling chipsets.* The company controls the lion’s share of the total notebook processors market, and laptops are still by far the access device of choice for Wi-Fi networks. Consequently, Intel should be able to pick up a sizeable proportion of a market which IDC forecasts will grow from $270 million in 2002 to $370 million in 2003. Calexico’s impact on the current cast of 802.11 semiconductor and equipment makers will vary. For Intersil, the chipset leader with over 60 percent market share, Calexico will invariably erode its position. Intersil booked $74.6 million from sales of its PRISM products - 39 percent of total revenue - in the third quarter of 2002, up 26 percent from 2001. However, the fourth quarter of this year may be the last time it is able to produce such a significant rise. The number of devices in the marketplace equipped with Wi-Fi access capability are still at modest levels, and Calexico will help drive Wi-Fi adoption further. After all, the chipset will reduce the time to market for notebook vendors looking for a seamless, integrated WLAN solution. Accelerating access device penetration will create a demand stimulus for supporting infrastructure, such as access points and routers. This will benefit WLAN equipment vendors on the whole, especially the likes of market leader, Proxim, and its chosen silicon partner, Agere. Another area where Wi-Fi integration may help Intel steal a lead comes from the company’s relationship with Transat, the Texas-based firm focusing on using GSM cellular SIM cards (Subscriber Identity Module) as a means to authenticate clients onto public WLAN networks. The technique will allow mobile network operators running hybrid WLAN and cellular networks to offer unified access and billing from a common set of backend servers. If Intel runs with this solution as part of future Calexico specifications, SIM-based public WLAN authentication will become the de facto industry standard. Any impact Calexico will have on the market will now be exacerbated following the announcement by Intel’s arch rival, Advanced Micro Devices (AMD), that it is also entering the Wi-Fi silicon race. It will begin sampling of its Alchemy AM1771 wireless LAN chip set and a min-PCI card reference design kit this month, with shipping scheduled to start early next year. The AM1771 is a pure-play 802.11b product. Essentially, AMD has the portion of the notebook processor market that is not Intel’s preserve – predominantly the mid to low end of the market. Given this market focus, AMD’s strategy looks smart – a dual-band Wi-Fi chipset would be expensive overkill for this segment. While it will overlap to a degree with Intel’s product, it will yet further accelerate Wi-Fi deployment across the market << - Eric -