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Mass Bluetooth products due in Q2
Networked electronics could take off sooner than thought

By Madeleine Acey, FTMarketWatch 8:33:00 AM GMT Jan 5, 2001

LONDON (FTMW) -- Bluetooth computing products are set to make an impact on the electronics market in the second quarter of the year, which is sooner than expected, industry officials and analysts said.

While many believe Bluetooth is still in its infancy, Swedish telecoms giant Ericsson, [US:ERICY] [SE:000010865] a champion of the radio-based wireless networking technology that promises connectivity between innumerable electronic devices, quietly launched the first Bluetooth phone headset days before Christmas.

British Bluetooth chip start-up Cambridge Silicon Radio announced it had completed its third round of funding on Thursday, with Sony [US:SNE] topping up the coffers to just under $50 million.

CSR puts three Bluetooth components onto a single-chip so that makers of laptops and personal digital assistants (PDAs) can integrate the technology into their products.

100,000 chips shipped

Managing director Phil O`Donovan said the company had delivered 100,000 chips already. He revealed that Japanese electronics companies ALPS Electric Co. and Mitsumi [US:MITMF] were in the process of building CSR`s BlueCore chip into laptops and PDAs. He couldn`t give a timeframe for those end-products to hit the streets.

But Credit Suisse First Boston wireless telecoms analyst Ian Burgess said volume shipments of finished Bluetooth products could be expected in the second quarter of the year.

It would have been the first quarter, he said, but the nature of the use of Bluetooth meant extensive testing was needed. For example, if consumers are to swap data between an Ericsson phone and a Toshiba laptop, and a Nokia phone and a Sony laptop or Hewlett-Packard printer, all products may have to be tested with each other before they are released.

Bluetooth will be big

But the second quarter is sooner than many were expecting. "That`s certainly sooner than I expected," said Katrina Bond, wireless analyst at telecoms consultancy Analysys. "I really was expecting the second half of the year, with bulk shipments next year."

She said Bluetooth would be huge in the future as people wanted to connect all the different electronic devices in their lives. "It will be an all-pervasive trend. I think we will have multiple devices and we`ll want them to communicate with each other."

Meanwhile, CSR is planning to spend its funding on further research and development and international expansion. The company said it`s working on versions two and three of its BlueCore chip and is looking at 5GHz technology.

O`Donovan said flotation was an "attractive option" but the company was yet to set a date for an initial public offering or to appoint advisers.

Madeleine Acey writes on technology for FTMarketWatch in London.

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