The idea that eventually became Bluetooth was born in 1994, when engineers at Ericsson
Mobile Communications investigated the feasibility of a low-power, low-cost radio interface
between mobile phones and their accessories. This quickly developed into the concept of
incorporating a small radio into both a cellular telephone and a portable PC, to connect the
two devices without the traditional cable.
As work on the concept continued, however, the true potential of the technology eventually
surfaced. If you could connect a cell phone to a PC, why not connect other devices as well?
Why couldn’t this radio-based technology become a universal bridge between devices—and
to existing voice and data networks? And why limit the technology to “dumb” connections—
why not provide the means for devices to automatically recognize each other, and perform
key functions automatically upon connection?
As the concept of Bluetooth developed, Ericsson (in 1997) approached several manufacturers
of portable electronic devices to discuss the development of this new short-range wireless
technology, and in 1998 five key companies—Ericsson, IBM, Intel, Nokia, and Toshiba—
formed the Bluetooth Special Interest Group (SIG), to coordinate the development of and
promote the Bluetooth technology. Bluetooth was formally announced in May of 1998, and
the Bluetooth SIG released version 1.0 of the Bluetooth specification in July of 1999.
Since then, membership in the Bluetooth SIG has grown to include more than 2000 different
companies. Four other large companies—3Com, Lucent Technologies, Microsoft, and
Motorola—have joined the five founding companies as so-called promoter members; these
nine companies provide direction and promotion for the entire 2000-company Bluetooth
effort. (The Bluetooth technology itself is available to all member companies via a royaltyfree
license—in other words, just about any company can use Bluetooth technology at no
charge.)
Why are so many different companies interested in Bluetooth? Ask the companies
themselves, and you’ll get the standard “enabling the consumer with new technology” line.
That may be true (and probably is true), but their motives are not entirely altruistic. The
reality is that all of these companies are in bed with Bluetooth because they think there’s
money to be made—and lots of it.
Everybody expects Bluetooth to be a big deal—but how big is big? All the major market
analysis firms are weighing in their forecasts, and the numbers are almost mind-boggling.
On the computer front, IDC predicts that 88.7% of all portable computers shipped in 2003
will incorporate integrated Bluetooth technology. On the mobile phone front, Cahners In-Stat
Group predicts that 40% of all digital cellular phones shipped in 2003 will be Bluetooth
enabled. Add it all up and you find that the folks who should know expect that the market will
be flooded with hundreds of millions of Bluetooth-enabled devices, starting now and hitting a
full stride no later than 2002. Merrill Lynch predicts that by 2005 there will be more than 2.1
billion Bluetooth-compatible devices on the market—creating a brand new $4 billion market.
With those kinds of numbers, you can imagine the dollar signs forming in the eyes of the
world’s major consumer electronics, telecommunications, and computer manufacturers. If the
Internet was the last gold rush, Bluetooth could very well represent the next huge moneymaking
opportunity, with literally billions and billions of dollars to be made annually. The
leaders in Bluetooth technology stand to reap a veritable bonanza when the market finally
develops.
Of course, every company chasing the Bluetooth rainbow expects to be a leader. All the
companies are betting that you’ll become a huge user of the technology in general, and that
you’ll pick one of their devices as your primary Bluetooth controller—using it to handle your
phone calls, control your electronic equipment, and store your electronic payment, ticketing,
and personal information. The telecommunications companies (Ericsson, Nokia, Siemens,
etc.) hope that some form of mobile phone becomes the dominant Bluetooth controller; the
computer companies (Intel, Microsoft, 3Com, etc.) hope that some form of mobile computer
(such as an enhanced PDA) becomes the dominant controller. It probably won’t be a winnertake-
all battle, but nobody wants to miss the revenues promised by this next big thing.
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