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Wi-Fi Direct and Bluetooth Competition to Accelerate

High-Speed Bluetooth, or Bluetooth 3.0 as it's also known, was designed to elevate Bluetooth connections to higher speed applications. It works by using classic Bluetooth to connect to devices, then Wi-Fi to deliver speeds of up to 24Mbps.

The availability of High-Speed Bluetooth via combo chips with classic BT improves its chances of success. However, a new potential alternative -- Wi-Fi Direct -- allows peer-to-peer connections between Wi-Fi devices.

If Wi-Fi Direct succeeds it could eliminate the need for Bluetooth 3.0 altogether, according to the latest market study by In-Stat.

"Standard Wi-Fi is increasingly common in many Bluetooth target markets," says Brian O'Rourke, Principal Analyst at In-Stat.

Until recently, lack of peer-to-peer connectivity was the most significant weakness of Wi-Fi in those markets. Wi-Fi Direct addresses that weakness and, because there is significant application overlap in PCs and mobile phones, it is a very real threat to the long term viability of Bluetooth 3.0.

In-Stat's latest market study found the following:

- Classic Bluetooth technology will remain dominant in phones indefinitely.

- Sony PS3 and Nintendo Wii game controllers have Bluetooth.

- Bluetooth 3.0, a new high-speed standard that combines Bluetooth with Wi-Fi, entered into the market in mobile phones in 2010.

- The Bluetooth USB adapter market will remain robust due to Bluetooth's lack of ubiquity in the mobile PC space and low penetration of desktop PCs.

- Personal media players, game consoles, and game controllers are the main drivers of Bluetooth growth in consumer electronics (CE) devices.

- Growth in industrial and medical markets will be driven by Bluetooth Low Energy.

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