Opportunities and Challenges for Short-Range Wireless in 2019

The year 2018 was another landmark one for the wireless industry, with strong growth across a number of different Short-Range Wireless (SRW) technologies. ABI Research expects this growth to continue over the next 12 months, with Bluetooth, Wi-Fi, 802.15.4, Near-Field Communication (NFC), Global Navigation Satellite System (GNSS), and other chipsets expected to reach well above 7 billion combined annual shipments in 2019. This growth will be primarily driven by ramp up and maturity across a number of vertical markets, in addition to new enhancements and protocols that will help drive innovation and increased competition in the connectivity arena. 

• Bluetooth Mesh to Build Traction: In July 2018, the Bluetooth Special Interest Group (SIG) announced that 65 mesh networking-capable products were qualified by silicon, stack, component, and end-device vendors. Looking in more detail at the products themselves, the vast majority are made up of profile and model stacks from leading Bluetooth chipset and module providers, including Qualcomm, Nordic Semiconductor, Cypress, Marvell, Realtek, Silicon Labs, Toshiba, and Telink, that define the fundamental mesh networking requirements and core functionalities of each Bluetooth mesh network node. On the end-device side, there are now certified mesh smart light bulbs from LEDVANCE and lighting controls with occupancy sensors from DANLERS. Other lighting vendors, such as Xicato, with independent pre-standard mesh solutions are also beginning to migrate to the standardized Bluetooth mesh implementation. In December 2018, Intellectual Property (IP) provider CEVA announced that its RivieraWaves Bluetooth Low Energy (BLE) Mesh IP has been licensed to 10 customers. ABI Research expects further growth and adoption of Bluetooth mesh solutions in 2019, although large-scale adoption of Bluetooth mesh across the smart building, smart city, smart industry, and smart home market verticals will take time.
• Wi-Fi 6 Growing Adoption: In October 2018, the Wi-Fi Alliance introduced a new branding mechanism for both existing and upcoming Wi-Fi technologies. The new names are aimed at providing manufacturers, operators, and end users with an easier to understand approach to the numerous available Wi-Fi standards and protocols, enabling them to clearly discover what Wi-Fi technologies are supported and currently leveraged by a device. 802.11ax will now be known as Wi-Fi 6, and ABI Research anticipates Wi-Fi 6 to be adopted across mainstream devices throughout 2019, with the certification program expected in 3Q 2019. In addition, ABI Research believes that the greater awareness of Wi-Fi devices’ strengths and limitations through generational Wi-Fi branding will drive competition and greater upgrade incentivization in the market. End users may no longer be happy with legacy connectivity in their broadband providers’ default supplied router and may be willing to spend extra on a device with Wi-Fi 6 versus Wi-Fi 5, in a similar vein to 3G versus 4G and soon to be 5G in the cellular space. This could lead to an increasingly competitive market in which Wi-Fi is leveraged as a key differentiator between different device types.
• Next-Generation WiGig to Open New Opportunities: While 802.11ad has had another slow year, with some limited opportunities in Virtual Reality (VR) headsets, wireless backhaul, and smartphone devices, attention is beginning to shift toward next-generation 60 Gigahertz (GHz) 802.11ay. In May 2018, Qualcomm announced it was partnering with Facebook’s Terragraph to provide 60 GHz wireless infrastructure using 802.11ad and pre-802.11ay chipsets as a wireless alternative to costly fiber deployments. More recently, in October 2018, Qualcomm announced its pre-standard 802.11ay chipset family for both fixed wireless access and mobile devices, also stating that the technology would be supported as part of its Snapdragon 855 platform announced in December 2018. Qualcomm is claiming its solution can already support low-latency 10 Gigabits per Second (Gbps) for Augmented Reality (AR)/VR, wireless display, and backhaul applications. With the standard set to be complete in early 2020, ABI Research anticipates further product announcements and renewed interest in 60 GHz technology. However, much needs to be done to build out a successful 60 GHz ecosystem to ensure 802.11ay does not suffer the same slow adoption as 802.11ad did.
• 6 GHz Wi-Fi Key to the Future of Wi-Fi: In October 2018, the Federal Communications Commission (FCC) voted in favor of opening up 1200 MHz of spectrum for unlicensed devices in the 6 GHz band. The 802.11ax (Wi-Fi 6) working group is currently determining how best to incorporate 6 GHz support into 802.11ax in anticipation of the spectrum becoming available. This will help pave the way for smoother adoption of 6 GHz chipsets and devices when it is eventually granted. Alongside this development, in July 2018, the Institute of Electrical and Electronics Engineers (IEEE) agreed to create a new Extremely High Throughput (EHT) study group for the next generation of Wi-Fi with a significant throughput increase over 802.11ax technologies. The key enabler of this increase will be the anticipated 1 GHz of additional unlicensed spectrum to allow wider 320 MHz channels and up to 16 spatial streams. Support for 6 GHz could enable Wi-Fi to connect more users than ever before, improve overall network and outdoor performance, and enable new high-performance use cases and device types to be connected with very low latency. If additional spectrum is made available, many stakeholders anticipate that the majority of station and access point devices going forward will have tri-band capabilities that support 2.4 GHz, 5 GHz, and 6 GHz.
• NFC Readers to be Supported by the Majority of Devices: NFC penetration within mobile devices is expected to continue in 2019 as the technology increasingly transcends beyond flagship devices and mid-tier products lines toward become a ubiquitous technology in the mobile arena. Areas like North America and Europe are expected to adopt the technology almost ubiquitously over the next few years, while Chinese Original Equipment Manufacturers (OEMs) are increasingly deploying NFC readers within their smartphones, greatly increasing consumer awareness and the global reader installed base. Payment, ticketing, and NFC tag product interaction purposes are primarily driving NFC adoption.
• NFC Tags to Hit the Mainstream: Widespread NFC reader penetration and the emergence of feature-rich NFC tags and innovations in silicon tag production efficiency are combining to enable widespread deployment of NFC tags for marketing, engagement, and brand protection purposes.NFC tags are now ready for the mainstream, and ABI Research forecasts strong growth for NFC tag technologies across clothing, accessories, pharmaceuticals, wine and spirits, and luxury use cases, among others. Continued production efficiencies and cost reductions for silicon tag technologies will provide additional incentives for brand owners to adopt and benefit from the technology. In addition, Apple’s decision to support iPhone NFC tag reading in iOS 11, initially via an app in the 7/plus, 8/plus, and X models, and now without this restriction on iOS 12 in its new iPhone XS, XS Max, and XR models, is removing a key barrier to NFC tag adoption.
• Z-Wave to Better Target Smart Home Sensor Devices: In December 2018, Silicon Labs launched the next-generation Z-Wave 700 series as part of its Wireless Gecko platform, bringing about greater range, power consumption, and cost performance benefits. Increased radio sensitivity can now enable increased range between nodes, reducing the number of hops, improving response times, and allowing for quicker sleep times, increasing the overall coverage of the Z-Wave mesh network to multiple stories and outdoor areas. Improvements in power consumption can now enable Z-Wave devices to operate from coin-cell batteries, bringing about reductions in overall product cost, enabling integration into new smaller form factor devices. ABI Research expects these enhancements to lead to better support of the battery-powered sensor market in the smart home, with the first products using this platform set to arrive in 3Q 2019 and 4Q 2019.

While the opportunity for SRW over the next 12 to 24 months is significant, the industry still faces a number of hurdles that it needs to overcome. Certain targeted Internet of Things (IoT) applications, such as industrial, building automation, and Real-Time Location System (RTLS) deployments, will take time to scale and may not be enough to counteract stagnating or declining consumer markets in the short to medium term. In addition, there is a distinct need to adopt new approaches to better convey the viability of wireless technologies in these new environments that goes beyond proof of concept and moves toward addressing difficult implementation obstacles and enabling widespread adoption and scalability.

Interoperability remains a key barrier to success across numerous IoT verticals. For many IoT applications, there is not an adequate one size fits all option, and the market will require several different connectivity combinations that can effectively communicate together in order to drive scale. Multi-protocol Integrated Circuits (ICs) that combine technologies like Bluetooth, Wi-Fi, and 802.15.4, in addition to cellular and LPWAN technologies, are helping to ease this process, but more work needs to be done.

For Wi-Fi, moving into different bands poses new challenges. For WiGig and Wi-Fi HaLow, there is still a need to build a wider 60 GHz and sub-1 GHz infrastructure in order to justify the rollout and maximize the potential of these technologies. For 6 GHz Wi-Fi, one of the key challenges will be the availability of 6 GHz-compatible chipsets and networking infrastructure. As 802.11ax (Wi-Fi 6) networking devices begin to roll out without 6 GHz support, it may be some time before enterprises opt for a further upgrade that supports the additional band. In addition, while 6 GHz will also bring about undoubted performance benefits, as Wi-Fi increasingly must be able to accommodate different device types and heterogeneous services (each with its own Quality of Service (QoS) requirements), the IEEE may need to focus more on the effective management of spectrum resources through different approaches that extend beyond traditional increases in spectrum availability and additional bandwidth.