• October 13, 2005
  • By Colin Beasty, (former) Associate Editor, CRM Magazine

Verticals Are Driving WLAN and IP Spending

The government and professional services sectors, along with financial services, healthcare, and retail, will become hotbeds of opportunity for the U.S. WLAN and IP telephony market over the next five years, according to two new IDC reports. Spending on LAN equipment within each industry is expected to more than double by 2009, producing a five-year CAGR of roughly 20 percent within each sector. In addition, IDC finds that cost savings, improved functionality, and robust feature sets are expected to drive the IP telephony market from 2005 through 2009. Overall, the biggest spending will come from the government sector, which spent about $100 million on WLAN equipment and $118 million on IP telephony equipment in 2004. Uses include WLAN for government mobile workers and IP telephony for government contact centers, such as healthcare customer hotlines. "Although there are many applications that can be used on wireless LAN, there are only a few that can be used within any particular business or industry," says Dan Corsetti, senior analyst in vertical market research at IDC. "Because of this the main issue regarding adoption will be identifying a business case for wireless LAN within different vertical industries." According to IDC's "U.S. WLAN Equipment 2005-2009 Forecast by Vertical Market," professional service organizations will more than double their spending on WLAN over the next five years to support increased connectivity and coverage for the sector's mobile workforce. The personal services vertical--particularly the hospital industry--also is expected to spur the adoption of WLAN, Corsetti says. "The hospital industry is expected to be a key adopter of wireless Internet access for guest services in order to advance customer care and intimacy, improve the customer experience, and create competitive differentiators." Much like the adoption of WLAN, the increased adoption of IP telephony equipment in the financial services sector will stem from the industry's need to improve performance of networked applications and increase real-time integration of data, according to IDC's "U.S. IP Telephony Equipment 2005-2009 Forecast by Vertical Market." Although not expected to grow as fast as the financial services industry, retail also is expected to extend its use of IP telephony equipment through 2009. There, the effort will focus on improving customer care and interaction, supply chain management, and managing global workforces. "Since delivering basic connectivity will usually not be the primary growth driver [of] these two markets," Corsetti says, "it will be necessary to identify data-driven, mission-critical applications or even a secondary cost driver besides connectivity, such as voice or fixed mobile convergence." Related articles: Wireless Worlds Within VoWLAN
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