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Wireless LANs based on the IEEE 802.11 standard are on a strong growth spurt, according to two research reports released this week.

The worldwide market for all products based on the 802.11 standard by 2006 will grow to $3.1 billion in annual revenue, from $1.2 billion in 2001, according to research company Dell'Oro Group, in Redwood City, California.

The wireless LANs will be particularly popular in the SOHO segment. Infrastructure products, such as access points, for SOHO will make up the largest part of the revenue, as opposed to client network interface cards or enterprise infrastructure products. The SOHO market will show annual revenue growth of about 40 percent between 2003 and 2006, Dell'Oro says.

Wireless LANs based on 802.11 now are the networks of choice for homes, used largely for sharing broadband Internet connections among multiple PCs, according to Dell'Oro. The declining prices of 802.11 systems have helped drive adoption in the home, the company says in a statement on the report, which was released Wednesday.

Doubling Up

The number of wireless LAN implementations in the U.S. has doubled over the past 12 months, according to a report released Thursday by Yankee Group, in Boston. Enterprises are using WLANs in growing numbers, Yankee says in a statement: More than 1 million WLAN access points are in use by more than 700,000 U.S. enterprises.

In addition to helping a company do business, wireless LANs can give companies the opportunity to offer a perk or paid service to customers and visiting business partners, says Adam Zawel, an analyst at Yankee.

"If they install the network with the right division of access, then they can benefit from both the employee-facing and the customer-facing initiatives," Zawel says.

Going Public

For some businesses, such as airports and restaurants, the motivation to install a WLAN may be primarily focused on public access. In most cases, the main benefit of wireless LANs is efficiency or other internal operational benefits, while the revenue from a service or the ability to draw customers is "gravy," he says.

However, to take this approach companies will have to work out a way to let outsiders log in to their networks while keeping them away from private information. In addition, today relatively few customers or other visitors are likely to have WLAN-enabled devices.

"Most enterprises are going to be reluctant to open up their wireless LAN to outsiders until the security issues are sorted out," Zawel says.