Cut Your Cables: Gigabit Wi-Fi is Coming

by Brad Moon | June 3, 2013 11:06 am

Cut Your Cables: Gigabit Wi-Fi is Coming

We like to think that we’re living in a golden age of wireless.

Thanks primarily to Wi-Fi and Bluetooth, most of us don’t ever have to plug into an ethernet cable at home, despite surfing the web on laptops, tablets and smartphones. Game consoles are online too, using that same Wi-Fi connection, and Smart TVs are streaming Netflix (NFLX[1]) movies using your home Wi-Fi. Want to pump out some tunes on the stereo? Bluetooth streaming from your smartphone to a wireless speaker system will take care of that.

However, take a look behind your TV and the limits of “wireless” quickly becomes apparent. The typical home theatre system is a tangle of cables, and the back of a multi-channel audio/video receiver is a nightmare of inputs. Worse, with every new add-on device (like set-top streaming boxes), TVs seem to be running out of physical inputs. Plugging all those wires into the right jacks, cutting holes in walls and fishing cables in an attempt to hide the worst of the visual blight has spawned an entire home-theater installation industry.

Well-known companies like Monster Cable Products[2] are riding the HDTV and home theatre wave, selling high quality HDMI cables, splitters, adapters, speaker wires and all the other hardware needed to physically connect all the components of your home entertainment system.

But what if all those wires could be replaced by Wi-Fi?

As The Economist points out, with today’s Wi-Fi (most homes are equipped with 802.11n routers operating in the 2.4-GHz and 5-GHz bands), that’s not practical[3]. Our current Wi-Fi connections might be sufficient for streaming compressed HD movies from the Internet, but for slinging the bits from a Blu-ray disc to an HDTV, more bandwidth is needed. And with the possibility of 4K Ultra HDTV[4] on the horizon — with four times as many pixels to move — Wi-Fi is a complete non-starter. Even HDMI, the single digital cable that replaced the combination of audio and video cables between many devices, starts to run into bandwidth issues when 4K content is thrown in the mix.

Companies like Broadcom (BRCM[5]) are currently offering a new class of wireless devices known as 5G Wi-Fi (the 802.11ac standard) that boosts Wi-Fi speeds up to 1.3 Gbps, tripling current maximum speeds. This is also known as Gigabit Wi-Fi since it breaks the 1 Gbps barrier. Computer makers are beginning to adopt 5G Wi-Fi since it’s fully backwards compatible with existing networks and offers a real speed boost. Apple (AAPL[6]) is rumored to be putting Broadcom 5G Wi-Fi cards in its new iMacs[7], for example. However, it’s possible that the market ultimately might skip 5G Wi-Fi in favor of a much more impressive standard, one that finally takes wireless beyond computers, smartphones and tablets to your TV and its components.

WirelessHD and WiGig are two competing standards that both use the 60 GHz radio spectrum. And both offer Gigabit Wi-Fi speeds that leave 5G Wi-Fi in the dust. Wireless HD[8] supports data transmission rates of 10-28 Gbps while WiGig[9] can push up to 7 Gbps. Use of the 60 GHz frequency means no interference from other household devices such as cordless telephones, but at the cost of distance — wireless data transmission is limited to about 30 feet. However, that drawback isn’t much of an issue when it comes to your home entertainment system with its components all in close proximity to each other.

HDTV (or 4K Ultra HDTV), game console, stereo — these new standards could finally let your cut the cables and realize the dream of having no wires to contend with, other than power cords.

The WirelessHD and WiGig standards have been around since 2008 and 2010, respectively. While WirelessHD has the crown in terms of speed, WiGig has the advantage of backwards compatibility with existing Wi-Fi networks. Consumer electronics and computer companies have begun choosing sides, with WiGig looking to have an edge at the moment based largely on that backwards compatibility (which means a WiGig device could take advantage of a home’s existing Wi-Fi network to wirelessly communicate with devices outside of its range). It counts Microsoft (MSFT[10]), Intel (INTC[11]), Cisco (CSCO[12]), Broadcom and Qualcomm (QCOM[13]) among its supporters, while Wireless HD has LG and Sony (SNE[14]) in its camp. One of the heavy hitters in consumer electronics — if not the heaviest hitter — Samsung (SSNLF) is hedging its bets by supporting both standards.

Once the standard battle is over, 60-GHz Wi-Fi has the potential to usher in a true era of wireless networking in the home. It has the capability of revolutionizing TV and home theatre design, streamlining the look of our home entertainments systems, simplifying the process of connecting devices and vastly increasing the amount of data flowing wirelessly through a home.

While consumers would be the winners in this situation, manufacturers of specialty home theatre cables will likely find their business drying up. Monster may find itself usurped by the likes of Marvell[15] or Wilocity[16], two specialty chipmakers pointed out in The Economist’s article as working on 60-GHz chips. Of course Broadcom and other wireless card makers will also be moving to take advantage of the opportunity. The TV market might not be the healthiest out there, but worldwide, 238.5 million units sold in 2012[17].

When you add audio receivers, Blu-ray players, soundbars and other devices that would be connected wirelessly, there’s potential for the home to become another smartphone or tablet-level market for makers of 60-GHz Gigabit Wi-Fi cards.

Although toes are already in the water, the gold rush won’t start until the standard is finalized  — then look for TVs and home theatre components (along with PCs, tablets and smartphones) to start advertising Gigabit Wi-Fi as a feature and card manufacturers jostling to dominate the new business.

As of this writing, Brad Moon did not own a position in any of the aforementioned securities.

Endnotes:
  1. NFLX: http://studio-5.financialcontent.com/investplace/quote?Symbol=NFLX
  2. Monster Cable Products: http://www.monstercable.com/company_info/monster_cable_products.asp
  3. that’s not practical: http://www.economist.com/blogs/babbage/2013/04/gigabit-wi-fi
  4. 4K Ultra HDTV: http://investorplace.com/2013/01/new-4k-ultra-hd-tvs-have-one-big-problem/
  5. BRCM: http://studio-5.financialcontent.com/investplace/quote?Symbol=BRCM
  6. AAPL: http://studio-5.financialcontent.com/investplace/quote?Symbol=AAPL
  7. rumored to be putting Broadcom 5G Wi-Fi cards in its new iMacs: http://www.macrumors.com/2013/05/21/photos-of-likely-802-11ac-gigabit-wi-fi-card-from-next-generation-imac-surface/
  8. Wireless HD: http://www.wirelesshd.org/about/specification-summary/
  9. WiGig: http://wirelessgigabitalliance.org/specifications/
  10. MSFT: http://studio-5.financialcontent.com/investplace/quote?Symbol=MSFT
  11. INTC: http://studio-5.financialcontent.com/investplace/quote?Symbol=INTC
  12. CSCO: http://studio-5.financialcontent.com/investplace/quote?Symbol=CSCO
  13. QCOM: http://studio-5.financialcontent.com/investplace/quote?Symbol=QCOM
  14. SNE: http://studio-5.financialcontent.com/investplace/quote?Symbol=SNE
  15. Marvell: http://www.marvell.com/wireless/
  16. Wilocity: http://wilocity.com/products/products
  17. 238.5 million units sold in 2012: http://www.electroiq.com/articles/sst/2013/04/following-decline-of-2012--global-tv-market-wont-recover-until-2.html

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