Ericsson Pulls Bluetooth

LM Ericsson (Nasdaq: ERICY) -- the company that invented Bluetooth -- has announced that it plans to stop making new chips using the short-range wireless technology.

Ericsson posted an announcement about the move on its Website, saying that: "Even though large volumes are manufactured, the business case for Ericsson’s design of new Bluetooth solutions is not strong enough."

The Swedish vendor says that is forming a new unit to support existing Bluetooth silicon customers and that its mobile units will continue to offer Bluetooth software.

Other vendors, such as IOgear Inc., have announced that they will continue Bluetooth development.

But the prognosis for the standard doesn't look so hot, now that one of its major backers has essentially pulled the plug.

"It's not gone yet, but it is not going to make it long-term," says Craig Mathias, principal at the analyst and consultancy firm, Farpoint Group.

"Ericsson made a business decision -- a good one," he chuckles.

Ericsson started developing its concept of a wireless "cable replacement" back in 1994, which eventually led to the formation of the Bluetooth Special Interest Group (SIG) in 1998.

But the struggling standard was plagued by interoperability and pricing issues before it hit the market, leading many commentators to predict its demise even before you could find Bluetooth products in the stores (see Bluetooth 2 Postponed?). A stable version of the standard -- version 1.1 -- was established in 2001. Both the Asian and European markets have seen some takeup of the standard.

However, the U.S. never warmed to the technology, and the burgeoning market for 802.11 wireless LAN home networking has largely overshadowed Bluetooth (see Bluetooth Stateside?). But in the end, Mathias feels, Bluetooth has been victim of its own hype, which saw the simple cable replacement technology get taken up into fancy concepts like the personal mobile gateway (PMG) idea (see Meet the Acronym Hunter).

"They set user expectations way too high," he says. "Bluetooth was the marketing department running wild." — Dan Jones, Site Editor, Unstrung

lrmobile_RFGuy 12/5/2012 | 1:18:59 AM
re: Ericsson Pulls Bluetooth Sorry to inject reality to your fantasy trip, guys. Bluetooth is alive and well and growing faster than any wireless standard ever introduced. The E/// announcement is about ending their technology licensing group, which has been unsuccessful - just as about every IP group has ever been when it has been buried inside a big corporate parent. Ericsson is not abandoning Bluetooth at all, it has solid plans through Sony?ericsson to continue to increase the attach rate in its phones. Craig Matthias' comments show him to be a rabid Bluetooth- hater who lacks the willpower to deliver a balanced viewpoint.
robert_p 12/5/2012 | 1:18:42 AM
re: Ericsson Pulls Bluetooth Gotta agree here.
If only some of the major PC manufacturers would take the $10 parts costs hit and make Bluetooth standard on PCs - maybe things could start progressing...

Gotta hand it to the Mac people - their Blouetooth enabled products ROCK!!!

JohnHauxwell 12/5/2012 | 1:18:04 AM
re: Ericsson Pulls Bluetooth I have to agree. It would appear that SE have made a decision to push "integrated devices" rather than allowing cheaper devices to flourish with interworking. Shame on SE, as a standard bearer for the BT world they should be 100% committed to the standard rather than looking to make a quick buck elsewhere.

PS mac + phone + headset + ipaq = happy me. Shame that PC manufacturers dont get the message!
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