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Consumers power wireless-gear market, report says

As security and management concerns ease, consumer and enterprise sales continue to drive growth in the wireless networking gear market, a research report says.

Sales of wireless-networking gear continued their steep climb, as consumers picked up on low pricing and equipment sellers began to ease the security and management concerns of businesses, according to a research report.

Worldwide sales in the third quarter were up 47 percent compared with the same period a year ago, according


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to a report Synergy Research Group released earlier this week.

Consumers were largely responsible for the hike, as manufacturers continued to reduce prices to increase volume. Introductions of new products based on the latest Wi-Fi standard, 802.11g, as well as reduced pricing for products using the older Wi-Fi standard, 802.11b, fueled consumer interest, said Aaron Vance, an analyst with Synergy Research.

"The consumer market made up 64 percent of the overall market in the third quarter?this segment, for manufacturers, is more and more about high volumes, low margins; it's increasingly all about price," said Vance. "The enterprise segment is also starting to see a recovery...security is slowly being marginalized as a barrier to entry for enterprise."

Businesses are still concerned about security vulnerabilities with wireless-networking technology, but equipment makers have developed better safeguards.

Cisco Systems was the market leader in revenue for worldwide sales in the enterprise market, with $109.5 million in the third quarter, a 63 percent improvement over the year-ago quarter's $67.3 million and a 31 percent increase from the second quarter's $83.4 million.

Although Cisco had the most revenue as a company in the overall wireless-networking market, consumer companies as a group had higher revenues.

Linksys, a division of Cisco, had $94.5 million in revenue and was the market leader on the consumer side. D-Link Systems was second, with $73.6 million in revenue, and it had the biggest percentage growth from the second to third quarter, 44 percent. NetGear was No. 3 with $65.6 million, and Buffalo Technology was right behind it with $65 million in revenue.

Linksys is a major player in the United States, while Buffalo is a bigger player in Asian markets, according to Vance. D-Link and NetGear are having an increased influence in Asian markets lately.