The raft of startups staking a claim in the ultrawideband (UWB) silicon space will help create a market potentially bigger than 802.11 wireless LAN and Bluetooth combined, according to the latest edition of Unstrung Insider.

The report -- “Ultrawideband: Spectrum for Free” -- claims that the experience and intellectual firepower of personnel at startups Staccato Communications Inc., Wisair Ltd., Pulse-Link Inc., and Alereon Inc. puts these companies in a great position in a market that could hit $630 million in value by 2007.

All four vendors have recently secured venture capital funding from investors attracted to the way UWB radio can increase data transfer rates (110 Mbit/s at 10 meters and up to 480 Mbit/s at 1 meter) without causing interference to other users in the same spectrum (see UWB Attracts VC Cash, Pulse-Link Throbs With $30M , Alereon's $31.5M New Year, and UWB Gets Intel Inside).

"The number and range of devices that could usefully be enabled by UWB is huge, and it is this sheer potential for massive volume shipments that gives UWB its commercial allure," says report author Gabriel Brown.

Despite the bevy of cash injections, Brown warns that startups will have to scoop up the early deals in order to fend off competition from established semiconductor vendors such as Intel Corp. (Nasdaq: INTC), Texas Instruments Inc. (NYSE: TXN), and Philips Semiconductors (NYSE: PHG).

"Now the chipset vendors have primed the market they must deliver on deadline. We expect the first production-quality silicon in early 2005."

Brown argues an ability to be first to market with “all-CMOS single-chip or two-chip products,” as well as striking partnership deals with larger competitors, is critical to startup success.

Falling unit prices -- from $15 in mid 2005 to around $5 by 2008 -- will drive volume shipments, but will make it tough for startups without strong distribution partners to turn a profit.

In addition to the companies mentioned above, there are more than a dozen startups with some angle on the UWB chipset market. Artimi Ltd., Blue7 Communications Inc., TZero Technologies, and WiQuest Communications Inc. are further names that Brown believes “have a good shot at success, based on the quality and experience of the founders.”

“Of the four, U.K.-based Artimi appears most developed and has already begun showing prototypes of its products.”

— Justin Springham, Senior Editor, Europe, Unstrung

The new report – Ultrawideband: Spectrum for Free – is available as part of an annual subscription to the monthly Unstrung Insider, priced at $1,350. Annual subscription includes 12 monthly issues. Individual reports are available for $900. Ultrawideband: Spectrum for Free may be previewed here.