ABI: What OEMs Consider When Choosing a Bluetooth Software Vendor

May 12, 2006

As more manufacturers embrace Bluetooth (IEEE 802.15), experts caution they must balance their needs against vendor offerings in five key categories: relationship, price, features, technical dependency, and reliability and reputation. At face value, these look like the same factors seen in other markets; on closer look, interesting irregularities appear.

According to ABI Research, both original equipment manufacturers (OEMs) and silicon providers are increasingly focused on differentiating offerings at the software level by tailoring stack products to meet specific needs of diverse end-use equipment markets.

"The importance attributed to each of the factors varies greatly between applications," said ABI Research principal analyst Stuart Carlaw. "For automotive vendors, the ability to customize solutions and to own and port code, as well as having a highly robust and stable stack, are paramount." This stems from the need to avoid costly recalls and to integrate Bluetooth into what is really a niche/specialist application with technical dependencies, features and reliability and reputation being paramount concerns.

This is in stark contrast to the high-volume cellular handset market in which price and relationship are key. Silicon vendors, such as Broadcom and CSR, have a huge share of design wins in the sector, and a correspondingly huge mindshare. Analysts said the immense income from the Bluetooth sector allows them to price competitively for both silicon and software. However, few OEMs are willing to compromise too much on quality and features in the interest of cost savings.

"As the Bluetooth market becomes commoditized, the door opens for ODMs (original design manufacturers) and ASSP (application specific standard product) manufacturers to make a quick buck with their own products," Carlaw said. "These companies will look to develop their own software stacks with the aid of development houses, or to purchase IP (intellectual property) from third parties."

This trend could start a virtual gold rush for a growing band of third-party specialist developers that have the flexibility to invest time into highly customized solutions that meet an individual company's requirements, at the price points only a streamlined business model can achieve.

Source: ABI Research.