Microsoft Exits Wi-Fi Hardware Business - InformationWeek

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5/11/2004
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Microsoft Exits Wi-Fi Hardware Business

Software vendor plans to discontinue branded wireless hardware but will provide support for two years.

Microsoft has decided to get out of the wireless-networking business after less than two years producing hardware.

A spokesman confirmed Tuesday that the company will discontinue almost all Microsoft-branded wireless hardware on the shelves today, including base stations, notebook adaptors, PCI adaptors, USB adaptors, and notebook kits. All existing products will continue to be supported by warrantee and customer service for the next two years, but no new products will be produced. The only currently available bit of wireless hardware that will avoid termination is the wireless network adaptor for the Xbox gaming system.

Microsoft declined to explain why it's dropping the business, saying the decision was made for a number of reasons. The company says it will use the expertise it developed producing the hardware to improve future products and services.

Since entering the wireless-networking space in September 2002, Microsoft has seen decent growth and sales, capturing about 6.6% of the market in March, NPD Techworld analyst Stephen Baker says. But the company may have realized it can't catch up with market leaders D-Link Systems, Linksys, and Netgear. Says Baker, "I think it's a very competitive space in the retail market. There's five pretty strong players, and one of the issues that [Microsoft] had was that they don't carry as broad a line of products."

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