The ARC Group has a report out that says that Bluetooth will continue to outship Wi-Fi in high-end smart phones.

ARC says Bluetooth phone shipments will hit 6 million this year while Wi-Fi shipments won't hit 1.75 million until the end of next year. I think they are underestimating demand for Wi-Fi a tad bit, although I do understand the low estimate; after all, there aren't that many devices yet available.

But I do dispute their assertion that Wi-Fi will only account for 15% of all smart phone shipments in 2007. I think we're going to see Wi-Fi-enabled devices, such as the Blackberry 7270 (due out early next year) be more successful than many predict.

But the point I want to make is this: shipments alone do not directly correlate with usage. Bluetooth is like the cruise control feature on cars - nice to have but not always used. I would argue that only half of all people with Bluetooth-enabled handsets actually use the technology regularly. I've encountered many people over the years with Bluetooth devices who either don't have a need for Bluetooth, or don't even know they have it.

Contrast that with Wi-Fi, where usage correlates more closely with equipment shipments. Since you have a pay a premium today to get a Wi-Fi-enabled handset, odds are that you'll be using it on a regular basis.

But I think the Bluetooth vs. Wi-Fi debate will get most interesting when both technologies find their way into handsets. I would love to know, for instance, which of the two technologies is most popular in the iPAQ h6315 Pocket PC.