FCC Provides Clarity for Makers of 5 GHz Devices
An FCC order released Wed. that gives equipment makers another year to comply with new restrictions for unlicensed devices that operate in the 5.250-5.350 GHz band (CD Feb 24 p12) was a win for companies that make equipment for the frequency, sources said Thurs. At issue was possible complications for a class of devices made by companies including Cisco, D-Link, Atheros Communications, Motorola and Proxim that operate at 5 GHz, as an alternative to the more commonly used 2.4 GHz operations.
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The 5 GHz spectrum is less desirable since waves don’t travel as far as at 2.4 GHz, but it’s much less congested than the other spectrum and has been growing in popularity.
The order temporarily resolves a dilemma for the FCC. In 2003 the Commission required unlicensed devices operating at 5.250-5.350 GHz band to employ dynamic frequency selection (DFS) so the devices won’t interfere with military radar systems. The FCC acknowledged in its order that implementation of DFS was “more complex than originally envisioned.” Sources said Thurs. they expect the DFS issues to be resolved within a year.
One industry attorney called it “a welcome and expected order” that maintains the status quo for the Wi-Fi industry. “What the Commission did here is simply say you haven’t solved it yet, but don’t worry. You can continue selling your existing devices for another year,” the source said. “The Commission recognizes that the DFS implementation issues have not been solved, but they wanted to make sure we could continue to sell our equipment in the existing portions of the band and they gave us another year to do it.”
Equipment maker Arcwave welcomed the decision. “This will enable cable system operators to continue to deploy full duplex wireless plant extension solutions operating in the 5.8 GHz and 5.3 GHz bands, while Arcwave and the cable industry continue work with the FCC on alternative solutions that will maintain the cable industry’s ability to effectively provide competitive voice and data service offerings in the small and medium size business market,” the company said.
Frank Hanzlik, managing dir. of the Wi-Fi Alliance, told us 5 GHz will become more widespread as wireless VoIP, streaming video and other applications that require more bandwidth also grow in popularity. “It’s a newer band; there’s more spectrum; and as a result, it’s viewed as a band that should be able to advance some of the more advanced capabilities related to voice applications, multimedia applications that may require more bandwidth,” he said.
Hanzlik expects to see many more devices that support both 2.4 GHz and 5 GHz in coming years, similar to the rollout of wireless phones that accommodate different technologies. “While the number of 5 GHz-only devices is very, very small… as we look at the certification this year there is a strong trend up to [dual] capabilities.” At this point manufacturers are driving the process, he said: “A lot of it is more supply-side push than the consumer pull at this point.”
Meanwhile, London’s Infonetics Research said in a report Thurs. that Wi-Fi equipment revenue was up 15% in 2004 to $2.8 billion, while the number of units shipped increased to 36.1 million, a 51% increase from 2003. Unit shipments are expected to increase through 2008. The bad news for the sector was a sustained drop in profits.
“The downward trend in revenue is expected to continue over the next few years,” the report said. “Price erosion continued for access points, wireless broadband gateways, and NICs, with 802.11b products in particular dropping dramatically in price since the launch of 802.11g.”
Cisco maintains its position as the leading wireless LAN manufacturer based on revenue, with a 17% market share worldwide, the report said. Cisco is followed in order by Cisco-Linksys, with a 15% market share, D-Link and Netgear. Other leading vendors include Buffalo, Symbol, 3Com, ZyXEL, US Robotics and Proxim.