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HR: Mesh Market to Hit $1B in '08

Shipments of wireless mesh gear will more than double this year, with the strongest growth coming outside of North America, HR finds

NEW YORK -- Worldwide sales of wireless mesh equipment are on pace to grow by more than 100% in 2006, and cumulative revenues for the sector will approach the $1 billion mark by the end of 2008, according to the inaugural edition of Wireless Mesh Equipment Market Tracker, a brand-new research service published by Heavy Reading (www.heavyreading.com), the paid research division of Light Reading Inc. (www.lightreading.com).

Heavy Reading's Wireless Mesh Equipment Market Tracker delivers a complete accounting of mesh equipment manufacturer market share, including sequential and cumulative share calculations for both unit and radio shipments. The tracking service also analyzes each vendor's market strategy and identifies and analyzes customer wins, providing granular insight into this emerging market sector unavailable from any other source.

The new service tracks nine vendors that are now generating sales from wireless mesh products: BelAir, Cisco Systems, Firetide, LocustWorld, Motorola, Nortel Networks, SkyPilot, Strix Systems, and Tropos Networks.

"The wireless mesh equipment market is set for robust growth over the next two years," notes Patrick Donegan, Senior Analyst at Heavy Reading and creator of the Wireless Mesh Equipment Market Tracker. "While the focus of attention until now has been on the planned municipal government buildouts in the U.S, the market opportunity will increasingly shift to developed and developing markets in the rest of the world, and to the carriers and enterprises carrying out those deployments."

Wireless mesh gear is now being evaluated, tested, and deployed all over the world, Donegan reports. "We're in the early stages of seeing some Tier 1 carriers deploying this technology – although not yet in the U.S., where carrier involvement has been most talked-about," he says. European carriers such as BT (U.K.) and Golden Telecom (Russia) are leading the way in carrier-deployed wireless mesh networks.

The emergence of wireless mesh as a viable technology sector has triggered a fundamental shift among equipment suppliers, according to data provided in the Wireless Mesh Equipment Market Tracker. Until the middle of 2005, specialist suppliers LocustWorld, Tropos Networks, and BelAir led the market in terms of shipment volumes; but Cisco Systems, Strix Systems, and Motorola have begun ramping up, and combined accounted for more than 33% of total units and 43% of total radios shipped in the first half of 2006.

Other key findings of the Wireless Mesh Equipment Market Tracker include the following:

The global wireless mesh market will grow to a cumulative total of 605,412 units, or 1.4 million radios, by 2008. Global demand for mesh products, measured in units, should grow at a CAGR of 61.26% during the 2006-2008 forecast period. Assuming an average selling price of $700 per radio, this makes for a cumulative mesh equipment market worth nearly $1 billion at the end of 2008.

Buyers and deployers of wireless mesh technology will change significantly over the next two years. Small WISPs and municipal authorities that accounted for 80% of mesh equipment purchasing in 2005 will account for just 28% of sales by 2008. Enterprises and carriers will become the primary equipment purchasers, accounting for 18% and 40% of the market, respectively, in 2008.

The prospects for wireless mesh technologies in emerging markets are strong. Notwithstanding political risk factors and prohibitive power emission restrictions in some markets, the basic value proposition – "If you want broadband, this is basically the only way you're going to get it in the near term" – is reassuringly straightforward and compelling. There is evidence of vendors beginning to direct their energies towards these opportunities in markets such as Russia, Kenya, China, and India.

The North American market is unlikely to live up to initial high expectations. As U.S. carriers begin digesting the real-world challenges of determining the right business model and providing quality services on large-scale mesh networks, they appear to be extending their evaluations of the technology, rather than rushing ahead with deployments. For large-scale deployments, neither the technology itself nor the underlying business models are yet proven to most large carriers' minds.

The Wireless Mesh Equipment Market Tracker is distributed in PowerPoint format and costs $4,995.

For more information, or to receive a free PowerPoint preview of this exciting new service, please contact:

Dave Williams
Sales Director
Heavy Reading
858-485-8870
[email protected]

Press/analyst contact:
Dennis Mendyk
Managing Director
Heavy Reading
201-587-2154
[email protected]

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About Heavy Reading
Heavy Reading is an independent market research organization offering quantitative analysis of telecom technology to service providers, vendors, and investors. Its mandate is to provide the comprehensive competitive analysis needed today for the deployment of profitable networks based on next-generation hardware and software.

About Light Reading Inc.
Founded in 2000, Light Reading Inc. (www.lightreading.com) is the ultimate source for technology and financial analysis of the communications industry, leading the media sector in terms of traffic, content, and reputation. It reaches an extensive audience of executives and technologists within the telecom and enterprise networking communities, as well as the financial/industry analysts and investors who track these sectors. Light Reading was acquired by United Business Media in August 2005, and operates as a unit of CMP Technology.

About CMP Technology
CMP Technology (www.cmp.com) is a marketing solutions company serving the technology industry. Through its market-leading portfolio of trusted information brands, CMP has earned the confidence of more technology professionals than any other media company. As a result, CMP is the premier provider of access, insight and actionable programs designed to connect sellers and buyers in ways that yield superior return on investment. CMP Technology is a subsidiary of United Business Media (www.unitedbusinessmedia.com), a global provider of news distribution and specialist information services with a market capitalization of more than $3 billion.

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