IDC predicts that WLAN hardware sales will gross AU$55 million this year -- an AU$12 million improvement from last year -- with the market expected to grow to AU$88 million by 2008.
According to IDC report stated falling prices of Wi-Fi products coupled with rising business and consumer support "will keep Australian WLAN market momentum going."
Warren Chaisatien, IDC Australia's senior analyst for mobile & wireless solutions, says many Australian businesses are already using wireless LANs.
"WLAN is no longer a pastime of the IT department. About one-fifth of Australian businesses already have WLAN within their organisations and that usage is spilling onto public areas," said Chaisatien.
However, Chaisatien says the "hotspot market remains nascent with service providers still largely operating in the 'land grab' mode". The study shows only half a million dollars of wireless service revenue was generated in 2003.
IDC hotspot's prospects as a separate provision remains "dubious", yet predicts hotspot service revenue will rise to AU$1.4 million this year and to AU$32 million by 2008.
"Coverage, pricing, roaming and billing issues as well as security concerns have been identified as inhibitors to adoption of public WLAN service," said Chaisatien.
IDC has recommended that cellular carriers benefit from WLAN and hotspot market opportunities by "assisting companies with corporate WLAN initiatives" and offering "hotspot as a complementary service".
The report also recommended that conventional terrestrial broadband service providers consider bundling hotspot service with their retail high-speed Internet offers.
"To make hotspot service more practical and intuitive, access charges must come down and universal roaming and billing arrangements must be struck," stated the report.