Opening up the "big" market is going to take sub-$1 chips. However, low cost must be coupled with interoperability and easy integration. Standardization will help achieve these aims, and Zigbee/802.15.4 is targeting the ultraeconomy that many markets are waiting for-going a long way to setting new imperatives.

But even Zigbee is not the immediate answer. To put the magic $1 threshold into perspective, silicon costs around 10 cents/mm2 for 0.18-micron CMOS before markup; Bluetooth chips are now around 18 mm2, and must come down in size to meet the $1 threshold. Going below $1 will take a while yet with existing standards-even with year-on-year silicon reductions of 20 percent. The next 18 months should see simple Zigbee chips approach $2-they will go below $1, but this is some years away.

This situation opens up a dichotomy of opportunity. Lower-volume OEMs must wait for standard chips before they can bring ideas to fruition. But larger OEMs with the market share and financial muscle to develop their own application-specific chips can, and are, pushing ahead. The required intellectual property must be specifically optimized for cost rather than performance-very different from the current focus of WLAN and cellular applications-but such IP is already becoming available.

The transition to 0.18 micron is giving real impetus to this "cook your own protocol" business: At this threshold it is more cost-effective to perform functions in the digital domain, and hence achieve flexibility and faster development. "Ubiquitous wireless" pioneers are innovating low-cost radios by DSP in hardware and software, and incorporating system components into device packaging. Design innovation during the next 18 months could create new leaders in many consumer markets.

Nick Horne manages Cambridge Consultants' Radio Communications Products Group ( www.CambridgeConsultants.com), based in Cambridge, England.