Shipments for Wi-Fi-enabled products fell in 2022 for the first time ever in the history of the technology, but that’s not cause for alarm.
The pandemic fueled so much demand that it makes it look worse than it is. Shipments grew 8.6% in 2021, then fell 4.9% in 2022, to 3.8 billion products with Wi-Fi, according to a new report from International Data Corporation (IDC).
Part of it was due to money being redirected from travel to new devices and improvements in the home, where a lot of people were conducting their work and school during the pandemic, explained IDC analyst Phil Solis. That led to a lot of demand in 2020 and some of that carried into 2021.
“Eventually they were going to fall and they fell in 2022,” he told Fierce. “It’s the first time Wi-Fi products ever fell.”
There have been other rough patches, such as in 2008-2009 where some products fell but there was an uptick in others, like smartphones. The iPhone came on the scene in 2007 and Android phones were picking up around that time as well, he said.
“You had periods like that where maybe one thing falls and something else did really well,” he said.
Other recent events, such as Russia invading Ukraine, rising interest rates and concerns about a recession are all contributing factors. Smartphones will continue growing but PCs, which includes desktops and laptops, will have a harder time, he said.
Going forward, IDC forecasts the market to be relatively flat in 2023 with shipments of 3.9 billion products. 2024 will see 6.4% growth, to 4.1 billion products.
Two-thirds of shipments in 2023 will be Wi-Fi 6 or Wi-Fi 6E and these will continue to expand into more IoT devices as additional Wi-Fi 6 chipsets targeting IoT devices hit the market, IDC said in a press release.
Primary client devices – smartphones, media tablets and PCs – remain a key driver of shipments, accounting for about 40% of Wi-Fi shipments in 2023, according to IDC.
Primary client devices' recent share loss is due to the flattening of that market coupled with the growth of IoT or endpoint devices with Wi-Fi, the research firm said. IoT reached 37% of shipments in 2022 and will surpass 40% in 2027. IoT surpassed smartphones in 2021 and will surpass all primary client devices in 2027, according to IDC.