A study has predicted that shipments of Bluetooth devices will double to 70 million units in 2003, with steady growth to follow over the next few years.
The Frost & Sullivan report states that: "Bluetooth has come a long way from the simple cable-replacement technology unveiled in 1998. Critics would be hard-pressed to name any other wireless communications technology that has managed to achieve the volumes and diversity of deployment of Bluetooth in just six years."
But the adoption of Bluetooth was not plain sailing in the early years, according to Frost & Sullivan: "At first the technology was over-hyped, leaving supporters disappointed when mass-market penetration didn't come to pass because of interoperability and interface problems.
"But recent refinements to the standard means that adoption in new applications is no longer a challenge. Interoperability between devices is seldom an issue, and interference with other radio technologies is a limited and increasingly disappearing concern."
According to the report, the future of Bluetooth is bright, with market segments such as mobile phones, PC-based applications, and emerging application areas such as industrial and automotive applications offering market potential. It states that: "Growth in the semiconductor sector, a hotbed of Bluetooth development, will bode well for continued buoyancy."
However, the report warns: "Although there is also no clear competition to Bluetooth in the personal area networking space, as none have its scope, volume or maturity, only development companies with a sound business plan and clear value proposition will survive.
"Even some of the larger initial Bluetooth players have found the returns from Bluetooth to be too limited to justify continued significant involvement. Avaya, Intel and Motorola have all scaled back their initial interest as the technology changed from being the world-changing technological advancement it was heralded as, to a more realistic breakthrough in personal communications and networking."
The company predicts that the next few years will see further streamlining of the component end of the Bluetooth market: "The growth opportunity lies in emerging applications, but only those able to demonstrate competence in supporting client development will win.
"For the companies involved in developing standards and applications for the technology, success will mean finding the right market segments and business strategies to appeal to the broadest number of users and hardware makers seeking to add the technology to the devices."