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Enterprise Wireless Holds Forth

Sanjeev Jain
Monday, November 17, 2008
Sanjeev Jain
Charmed by the potential of wireless, Microsoft CEO Steve Ballmer recently made an announcement at the 3GSM World Congress 2006 at Barcelona, Spain: “We now have a new TV service and a new unified communication solution for mobile devices.”

It’s not that Microsoft wants to avoid a rival, but it is an indication of the growing interest in the wireless space by larger companies. Today, thanks to cheaper wireless infrastructure and growing investments in wireless in the fast growing markets of Latin America, Asia and Africa, the wireless industry has revived. Massive deployment of wireless infrastructure across the developing world is making VCs take a reconsider the wireless space. During the late 1990s and early 2000, companies developed technology that promised to make wireless a real possibility. However VCs burnt their hands, as the world was not ready to adopt wireless technology. But today the wireless sector is among the most mature industries and a fast adopter of any new technology.

And the VC’s biggest target now is wireless industry. According to a report from London based market researcher VisionGain Intelligence, in 2005 about 152 wireless companies received $1.3 billion in VC funding, a 24 percent jump over 2004. “The VC activity in wireless has picked up since last year and on the upswing,” says Richard Yen of Blueprint Ventures. “Wireless accounted for about seven percent of all VC investment last year.”

“The wireless continues to grow. That’s the market. A lot of companies got funded in 2001-02 time frame, most of which folded. Few survivors who received funding are at the helm of their business,” says Fred Wang of Trinity Venture Partners.

In the telecom business, about 60 percent of all investment goes into wireless, says the VisionGain report. The reason is a change towards IP-based telephony, and the demand for wireless. Voice over Wireless – the merging of VoIP and Wi-Fi – is expected to be the “next big thing” in wireless communications. A recent survey by telecom gear maker Avaya showed that more than 75 percent of network operators and service providers have identified mobile VoIP or VoFi as a top priority for new metro Wi-Fi networks.

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