- The building wireless trend will have a major impact on the global network equipment industry in 2005. WLAN (Wireless Local Area Network) modules are expected to see more widespread adoption in notebook PCs, reaching a 90% penetration in 2005 compared to 70% in 2004. DSL (Digital Subscriber Line) equipment, cable modems, and SOHO routers are also anticipated to see a higher level of wireless integration. Furthermore, WLAN QoS (Quality of Service) mechanisms being progressively put into place will likely lead to a diversification of WLAN applications such as voice-over-WLAN and multimedia-over-WLAN.
Taiwanese WLAN growth in 2004 was heavily determined by notebook PCs, leaving little room for growth. Although the mounting penetration of wireless functionality among broadband equipment and consumer electronics has brought new business opportunities, WLAN module makers face the challenges of establishing new customer relationships and overcoming technological thresholds.
In terms of broadband equipment, the worldwide DSL subscriber base is set to hit 128.8 million in 2005, with 31.1 million net additions. Western Europe will be the largest fount of growth, pouring out 12.7 million subscribers for a total of 44.1 million. China and the United States are expected to witness the next highest subscriber gains.
Worldwide cable modem subscriber scale is forecast to reach 51 million, six million more subscribers than achieved in 2004. North America is expected to grow by 2.8 million subscribers for a total of 26 million cable modem subs.
As broadband penetration rates increase and with ever rising transmission speeds, in 2005 service providers are expected to more aggressively roll out triple play data, voice, and video services to raise ARPU (Average Revenue Per User).
2004 saw increased outsourcing rates from the major brands, respectively yielding 73% and 65% of global DSL and cable modem supply to Taiwanese makers. In 2005, the stepped-up promotion of triple play services will bring on the advent of a new product lifecycle. Given its current supply relationships and capability in VoIP (Voice over Internet Protocol) technology, the Taiwanese broadband equipment industry stands to enjoy a new peak in volume and value growth.