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Secure Wireless LANs Enable Remote Working Apps

It's likely that the global COVID-19 pandemic will impact parts of the legacy enterprise networking sector, as fewer employees at the more progressive companies return to a headquarters office campus, branch office, or other traditional workplaces. However, some IT networking sectors continue to grow.

Revenues in the enterprise segment of the wireless local area networking (WLAN) market grew at 24.6 percent year-over-year in the first quarter of 2021 (1Q21).

In the consumer-class WLAN market, revenues increased 11.7 percent in the quarter, giving the combined enterprise and consumer WLAN markets year-over-year growth of 16.7 percent in 1Q21, according to the latest market study by International Data Corporation (IDC).

Wireless LAN Market Development

The 24.6 percent growth in the enterprise-class segment of the market builds on a strong end of the year in 2020, with fourth-quarter 2020 revenues increasing 10.3 percent year over year. Combined, two strong quarters in a row indicate that enterprises have begun to recover from pausing or canceling WLAN infrastructure investments in the previous quarters of 2020.

Growth in the enterprise WLAN market continues to be driven by the latest Wi-Fi standard, known as Wi-Fi 6 or 802.11ax. For the first time in the enterprise segment of the market, Wi-Fi 6 access points (AP) made up more than half (50.5 percent) of the revenues in the dependent AP product segment -- that's up from 43.7 percent in the previous quarter.

The Wi-Fi 6 products made up 37.1 percent of dependent AP shipments -- that's up from 32.2 percent in the previous quarter. The Wi-Fi 5 products, also known as 802.11ac, made up the vast balance of remaining dependent access point sales.

Meanwhile, the consumer-class WLAN market continued to perform well in 1Q21, although at a slower growth rate than what was seen in much of 2020. The consumer-class WLAN market increased 11.7 percent in revenues and 5 percent in unit shipments.

The Wi-Fi 6 products continued to grow in the consumer market, rising to 20.3 percent of the consumer segment's total revenue, up from 16.2 percent in 4Q20. The Wi-Fi 5 APs still make up the majority of revenues (66.2 percent) and unit shipments (61.8 percent).

"The enterprise WLAN market showed a strong rebound in the first quarter of 2021. As vaccines continue to roll out across the globe, organizations are preparing their enterprise networks for workers, customers, students, and other patrons to return to their campuses and they're investing in enterprise-class WLAN technology to enable connectivity," said Brandon Butler, senior research analyst at IDC

Despite a pause in some Wi-Fi investments in 2020, IDC believes that WLAN technology remains one of the foundational technologies for businesses across the globe today.

From a geographic perspective, the enterprise WLAN market saw growth across all major regions of the world. Growth was particularly strong in the Asia-Pacific region: the market in China grew 41.2 percent year over year, while Japan's market increased 111.8 percent as preparations are underway to host the Olympics this year.

Across the rest of the region, annual growth reached 19.3 percent with Australia recording a 27.4 percent increase year-over-year.

Growth was also strong in the Americas where the U.S. market increased 24.1 percent, Canada's market grew 29.3 percent, and the Latin America region increased 23.8 percent.

In Europe, results were more mixed but still positive. The Western Europe market increased 15.8 percent year-over-year with strength from Germany's market, which grew 25.9 percent. Central and Eastern Europe increased 3.9 percent while the Middle East and Africa region were up 2.6 percent year-over-year.

Outlook for Wireless LAN Applications Growth

Wireless LAN growth was positive across most regions of the world in the first quarter of 2021, which is a strong indication that the enterprise WLAN market is recovering from 2020, according to the IDC assessment.

IDC expects growth to continue in the remaining quarters of 2021 as the impact from the COVID-19 pandemic continues to wane and enterprises look to invest in mobility and connectivity solutions.

That said, I believe more CIOs and CTOs are likely to seek ways to offer managed WLAN solutions for some categories of essential employees and executives that work from home. Secure access to online corporate resources and customer data is a requirement in highly regulated industries.

Furthermore, the global Digital Workspace solutions market will grow rapidly in the coming weeks and months of 2021, in support of the evolving remote and distributed workforce phenomena.

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