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Why the Separate Factions?
As far as the overlap of technologies goes, IEEE 802.11 is a wireless networking standard. It exploits Internet protocols, and although it could transfer voice traffic using methods such as voice-over-IP, it doesn't carry voice natively in the way Bluetooth technology does. The range and data rates of IEEE 802.11 lead to relatively high power consumption, but low-power, short-range versions of IEEE 802.11 could be implemented. Could a low-power variant of IEEE 802.11 be a viable PAN solution? Perhaps it could, but because it is optimized for a different domain, namely WLAN, some characteristics would lead to a less-than-optimal solution if IEEE 802.11 were used for WPANs. For example, the quality of voice traffic might be inferior when compared to Bluetooth technology, which delivers voice packets in an expedited, high-priority manner and uses a robust voice-encoding scheme that is quite tolerant of lost packets. Perhaps more important, though, is the notion that LAN technologies are not particularly well-suited for the kinds of interactions that typically occur in PANs.
In a WPAN, devices may come and go frequently, and the PAN may join or collaborate with other networks in proximity as the WPAN user moves about. LANs tend to be better suited for stationary networks, or at least networks where the participants move rather infrequently. Bluetooth technology, on the other hand, is based upon proximity networking. The Bluetooth specification includes methods for detecting new devices that come into proximity and allowing these devices to join Bluetooth piconets seamlessly. Another consideration in the WPAN domain is that many small personal devices do not include robust networking components such as an IP stack. The common IP-based language of the Internet is widely deployed, but many small devices, often owing to constraints on memory and processing power, speak their own data communications language. Many mobile phones, for example, use protocols developed by the WAP Forum to access networks.
Conversely, Bluetooth wireless communication is not a full-blown networking technology. Bluetooth profiles do define methods that allow Bluetooth devices to access networks, but these are limited to the use of the point-to-point protocol (PPP) for dial-up networking or LAN access. In version 1.x, there is no support for general IP networking like that used with IEEE 802.11.
And finally, although these important WLAN and WPAN technologies are specified by different industry groups (the IEEE and the Bluetooth SIG, respectively), neither organization takes the position that they are competing for the same solution space. Indeed, the IEEE itself makes a distinction between WLANs and WPANs similar to the one in this discussion. It is well-known that the IEEE 802.11 working group addresses WLAN solutions, but the IEEE also has an 802.15 working group that deals with WPAN solutions. Moreover, the single WPAN solution seriously considered for adoption as an IEEE 802.15 standard is a subset of the Bluetooth specification! The portion of the Bluetooth technology that is applicable in the scope of IEEE 802 standards (essentially, the PHY and MAC layers of the ISO stack) is currently well on its way toward adoption as the IEEE 802.15.1 WPAN standard. This action by the IEEE underscores the differences between WLANs and WPANs, and emphasizes the importance of Bluetooth wireless technology as a leading WPAN standard.