Telecoms slump puts the bite on Bluetooth

Flagging sales of mobile phones and other gadgets are hurting the growth of Bluetooth, according to a new report. But despite lingering compatibility problems, the technology still looks like a good buy for consumers

The future of the Bluetooth market does not look quite as rosy as it did a year ago, according to Germany's Micrologic Research, which has cut its forecast for this year's Bluetooth chipset shipments by 10 million units. The revised forecast reflects overall sluggishness in the mobile phone industry, according to Micrologic.

Bluetooth is a cable-replacement technology, creating wireless links between mobile phones, peripherals, PCs and other gadgets. This year Bluetooth is seeing its first mass-market exposure, making its way as a default feature into mobile phones, laptop computers and some PDAs.

Micrologic predicts that 35.3 million Bluetooth chipsets will ship this year, down from an earlier prediction of 45.4 million units. Bluetooth will also take a year longer to hit the one billion mark, the firm says, when 1.3 billion chipsets ship in 2006. Micrologic had earlier expected the one billion line to be crossed in 2005.

"If you look at the mobile phone market, not as many are being sold as originally predicted, and that's a key Bluetooth market," said Niels Kellerhoff, Micrologic's director for European operations. He said that the general economic slump, as well as persistent compatibility problems between Bluetooth products from different manufacturers, also contributed to the revised forecast.

"Consumers really need for it to work, without having to worry about whether it's going to work," he said. "That's something that still needs to be addressed."

However, he said Bluetooth is still expected to become a big seller, and will make a real difference to consumers. "It's a personal communications technology, in contrast to wireless LAN. It lets all of those small devices and gadgets synchronise together and talk to each other," he said. "It is definitely something that people will want to use in the future, instead of other alternatives like infrared."

The forecast derives from a study called Bluetooth2002, released earlier this month.

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