SlashDot pointed to an article by Bob Frankston on ZDNet describes how he thinks that Bluetooth is dead because it is basically a one trick pony in comparison to 802.11.

I, on the other hand, think that until we find a better way to mesh wireless networks for different uses, we are going to find protocols like Bluetooth to be useful.

First, let me say where I think he's right: the general statement that the Bluetooth is just a radio and a set of profiles.

Now, let me tell you where I think he's wrong: Bluetooth is more useful to the general public as a peripheral connection device than 802.11 in many cases.

My rationale is basically that short-range, low power, inexpensive, and battery conserving radios are very useful in a personal area network, which is what Bluetooth has been shown to be best at. Things like location sensing (Ericsson Clicker on the Macintosh) are very useful technologies that 802.11 would be inappropriate. Further, a headset built on 802.11 would require substantially larger batteries and put the 802.11 radio a bit closer to my head than I care to have it. The lower the wattage of the transmitter next to my head, the happier I am.

On to the more important part: the standards themselves. The 802.11 standards tell you how to put Ethernet over the radio. This is really useful in a LAN. However, Bluetooth tells you not only how to signal the radio, but also how addressing is done, how services are located and also declares a set of service requirements that everybody carrying the Bluetooth logo must adhere to. It is this set of standards that makes Bluetooth really useful for a Personal Area Network, such as the way that I get my phone, laptop and headset to talk to each other.

It is possible that through Rendezvous and other automatic configuration technologies we may some day get useful standards and maybe even some level of ubiquity, but we will never be able to look at the WiFi logo and say: "Ah, it's a WiFi headset, so I can use it with my WiFi computer." This is a great advantage of Bluetooth and is likely to keep it around for some time to come.