Microsoft's Wireless Home
However, Microsoft hopes to do more with WLAN than just make a buck off 802.11b kit, which is being made for Microsoft by Accton Technology Corp., a Taiwanese manufacturer of communications equipment. Microsoft is hoping that the software supplied with its WiFi hardware will make it easier for users to create a wireless home network, which will then provide it with an infrastructure for which it can provide other devices, software, and services.
The difficulty of setting up a wireless network has been "one of the bottlenecks" to the adoption of this technology in the home, says Adam LeVasseur, group product manager of Microsoft's consumer hardware division. This new hardware, which has been provided with setup wizards and a number of automatic features -- combined with the 802.11b support that is already embedded in Windows XP -- should make it easier.
Microsoft products like the forthcoming Mira TV/PC "remote control" and Tablet PC Web pads, as well as a growing number of Pocket PC handheld computers and plain ol' laptops rely on WLAN for their connectivity.
However, hardware is just a small part of the overall home networking picture for Microsoft. "I think they have a services vision in mind; I think they have a distributed device model in mind," says Mike Wolf, director of enterprise and residential communications at research firm In-Stat/MDR. "They want to get their software on every device in the home." This is why, Wolf argues, software like the Windows Media Player 9 has been optimized to deliver content over WLAN.
"They don't want to be hardware -- they want to sell software and services," agrees IDC analyst, Jason Smolek.
In fact, if you look at Microsoft projects like "soft WiFi" (see WLAN = Windows Wireless Networking?), it is clear the company is trying to embed much of the functionality offered by today's WLAN hardware into tomorrow's operating systems.
"Hardware always falls by the wayside," says Smolek. "They know they want to bundle this into a Windows service.
In fact, analysts say that while Microsoft will probably carve itself a niche in the consumer market with its high brand recognition, Redmond probably won't knock fast-growing consumer WLAN providers like Netgear and Linksys Group Inc. off their perches, because these firms offer cheaper hardware.
Microsoft has launched five 802.11b products, which range from an $80 PC card to a $150 "base station" (access point). Most comparable consumer-oriented PC cards now cost $50 or less, with access points at around $100.
So can Microsoft make a profit from its first foray into WLAN hardware? "They could make a margin, albeit a slim one," says Seamus McAteer, principal analyst at the Zelos Group LLC. "But they're not going to own the market."
— Dan Jones, Senior Editor, Unstrung