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Sydney systems integrator eVideo had just six weeks to deliver a videoconferencing system to a power plant in far north Queensland to link it to its satellite sites around the Sunshine State and Brisbane head office.
Stanwell Corp, a state government electricity generator, has a dispersed business with hydroelectric power stations at Barron Gorge, about 20 kilometres north-west of Cairns, and Kareeya on the Tully River, five hours drive north of Townsville.
Its Polycom ISDN system was past its serviceable life. And Stanwell's chief executive was keen to cut travel, says the generator's ICT infrastructure refresh project manager, Peter Dodd.
eVideo recommended the company go with upstart videoconferencing maker, LifeSize. The network includes 10 video systems, a 24-port multipoint bridge, gateway and gatekeeper, transit server and control software in Brisbane, and Samsung LCDs on trolleys.
Dodd attributes some of the 15 percent drop in travel expenses to the new network that provides high-definition video and audio, and he aims to cut that spending by almost as much again in the next six months. And the 10 LifeSize Team 200 setups scattered through Stanwell's network make staff more productive, improve their work-life balance and reduce the company's carbon footprint, Dodd says.
Such recurring themes have led to a $US2 billion ($2.18 billion) videoconferencing industry where the Asia Pacific is one of the hottest markets, accounting for a quarter of worldwide revenue and 41 per cent of unit sales, says US analyst Wainhouse Research.
The LifeSize system and its support exceeded Dodd's expectations, he says, especially the "muticonferencing" that links five sites on a call, which was a "vast improvement". Dodd says the high-definition video aids more natural communications.
"For face to face communications, you could see how receptive and reactive they [videoconference participants] were to someone speaking," Dodd says.
He stops short of calling the system "telepresence" with its immersive overtones but says its flexibility and quality allows the generator to do business with partners and suppliers.
Staff have taken to the system with such gusto that a planned network upgrade can't come fast enough, he says.
"The previous system had a reputation for being somewhat difficult to operate. The new tech is very much press and play and was a step in improving acceptance of it. The vast improvement in the quality of video has [aided] acceptance."
The business is considering deploying desktop video systems such as the $3000 LifeSize Passport for its senior executives so enthused was it with the results, Dodd says.
eVideo swooped in at the "death" to snatch the $400,000 Stanwell deal from Tandberg, says the reseller's director, Tom Morgan.
"It came via Amber Tech who are one of two distributors," Morgan says. "They were about to go with Tandberg and we came in at the death.
"We're probably the most experienced in the videoconferencing industry for LifeSize because we have certified video engineers where a vast majority of [resellers] are more in the [audio-visual] or IP space.
"And this is why we won the job as well because we have experience in the industry."
Morgan says LifeSize could look to rival Cisco and Polycom, eVideo's other major brand, for clues how to run its channel. "We've been 12 years with Polycom and they are very, very tight about who they put on as a dealer. You can't go to Polycom and say I want to resell your products and if you're into video bridges you have to purchase the equipment and have certified engineers."
So impressive was eVideo's pitch that Stanwell sent a purchase order a couple days later. Morgan says his business is one of the few with networking and audiovisual knowledge. He aims to help dealers from either end of the spectrum with a managed services offering, providing the smarts to support their customers.
"The users are actually using the equipment more now because they didn't like the standard definition [videoconferencing] but they are having network issues," Morgan says. "They are looking at upgrading bandwidth because HD is bandwidth hungry but the good thing is users are embracing it rather than hopping on a plane."
LifeSize country manager Patrick Micallef says the company's palm-sized Passport handheld HD videoconferencing system available this month in Australia ushers in an era of videoconferencing for mobile and remote workers, road warriors, emergency and first responders.
"It will open video communications within the whole organisation rather than being restricted to a meeting room or dedicated telepresence environment," Micallef says.
In hospitals the $3000 device "could almost velcro to the back of a mobile display", Micallef says.
Old tech?
The concept of videoconferencing dates back 131 years to crystal ball gazing by famed engineer Thomas Edison and early work by French cartoonist George du Maurier. [see the 'history of video conferencing' image gallery, top right].
But it wasn't realised until 1927 when US Secretary of Commerce Herbert Hoover sent his image from Washington DC to New York. The German post office commercially deployed the technology for its customers prior to World War II. Bell Labs and AT&T tried to revive videoconferencing and desktop video phones from the ‘50s to the ‘90s with little to show for billions of dollars of development.
It was only when standards started to filter into mainstream use and cheap, off-the-shelf webcams and soundcards with free software such as Skype became available that it seeped into broader use.
The problem with the technology was always that its cost far outweighed the utility to the user. Systems were clunky and obtrusive, difficult to use and access (early attempts used special booths that were few and far between) and, paradoxically, the convergence of audio-visual, collaboration and communications technologies daunted many users.
Read on for more...
Networking-equipment maker Cisco gave the sector a shot in the arm last month when it launched a $US3 billion ($3.25 billion) bid for Norwegian videoconferencing leader Tandberg.
Wainhouse ranks it a "huge deal" with profound impact. "The ripple effect for the . . . market is likely to continue for months," says Wainhouse senior researcher and partner, Ira Weinstein.
"A Cisco-Tandberg merger will drive some companies into the hands of others while causing some alliances to be broken."
Weinstein says it's also a tacit admission on the part of Cisco chief executive officer John Chambers that the networking giant's proprietary technology strategy was "fundamentally flawed".
"While Cisco was able to sell above the videoconferencing manager in many situations, this only partially disguised that the market is looking for standards-based, interoperable solutions that span the conference room to the desktop to the home."
Tandberg's pending sale doesn't faze Nectarios Lazaris, group IT operations manager for architects Woods Bagot, who recently had national reseller iVision install the Norwegians' videoconferencing suites at the global design firm's studios in Sydney, Dubai and San Francisco.
The business integrated it into its unified communications platform that runs Microsoft software. Lazaris says the HD MXP 8000 two-screen systems allow natural communication and collaboration, speed knowledge sharing and give clients confidence the firm's "stars" are working on their projects wherever they are in the world.
He attributes a $440,000 saving from an annual travel budget of $6 million: "You have to put in a
good justification to jump on a plane".
"We've taken it further and the Microsoft Office Communicator and Tandberg videoconferencing solution are one unified comms," he says. The business now uses videoconferencing for all board meetings, bringing together directors irrespective of their geographies.
Lazaris says a big comfort during the deployment was Tandberg's global reach that meant he didn't have to "know or care" who did the job offshore.
Tandberg's Australian channel manager Adam Britten says the spread of high-quality, business-grade broadband and the National Broadband Network underpin a bright future for videoconferencing that suffered from relatively poor ISDN lines in the past.
"One of the things that held back videoconferencing or unified communications and telepresence was availabilty of bandwidth and the costs," Britten says. "Especially in regional areas it's an inhibitor," he adds.
Systems integrators that sell unified communications potentially have the most to gain from videoconferencing's traditionally fatter margins, he says.
"A systems integrator has an incredible amount to gain by driving a video strategy from within its customer base.
The associated revenue an integrator can bring through from video is quite significant.
"Being more than dialtone and having a visual aspect to it has incredible relevance for that channel," says Britten.
The CRN View
Tandberg's proposed sale to Cisco validates overnight a technology that has gestated for 131 years. Wainhouse says Cisco's combination of sales, marketing and gear "will likely raise the water level for all boats [but] some boats will float better than others".
The price-benefit ratio is now where it needs to be for videoconferencing to reach mass business adoption. Inexpensive, high-quality options such as LifeSize's palm-sized Passport busts high-definition videoconferencing out of mahogany row and opens avenues for mobile workers. Generation Y, weaned on video such as camera-phones, YouTube, Skype and vodcasts, is a precocious and comfortable adopter. And as more users accept videoconferencing, capacity grows under the National Broadband Network and standards-based systems gain traction the network effect will give existing users greater utility and reasons to use their gear, especially outside the firewall.
The opportunity rests with resellers that specialise in unified communications, networking (especially Cisco gear) and audio-visual installations to unite to provide their customers with cost-effective solutions that do more than cut travel costs but improve service delivery. If you don't have all the pieces inhouse consider banding together or buying a reseller (subject to due diligence) that has your missing pieces.
Resellers and systems integrators that service vertical industries where travel is a given such as mining or who have customers with geographically dispersed offices have an opportunity to start a conversation about the technology and how it unites the diaspora.
The economy will rebound so the immediate pressure on travel budgets will ease but the benefits from heightened collaboration, improved work-life balance, triple-bottom line accounting and reduced carbon footprints will only become more apparent.
Crossing lines
The distinction between videoconference calls and video phone calls are blurring as technology improves.
Desktops: Two-way video communications are widespread using cheap, consumer off-the-shelf systems and free software such as Skype. LifeSize is releasing this month a $3000 high-definition unit for standalone desktop use that integrates with Skype for audio.
Videoconferencing: Traditionally connected groups of people using sound and vision over distance and held in a dedicated room or facility.
Telepresence: High-end ($600,000 or more) facilities that optimize lighting, sound and other environmental factors to make the best use of data-hungry, big-screen high-definition and high-fidelity audio systems that make remote participants feel they are in the same room. Participants may effect changes at the remote location.
Adoption rules to live by
Six reasons why videoconferencing took 131 years to catch on:
- Not every new technology leads to stunning market success;
- Just because the press says it will, does not mean it will;
- Growth often takes longer than expected;
- Growth often reaches lower levels than expected;
- Technological convergence is not a certainty; and
- Innovations involving complex systems face more hurdles to market acceptance than those that stand alone.
Source: On the persistence of lackluster demand: the history of the video telephone, Schnaars and Wymbs (2002)
Links
See a video of Ericsson's vision of the video phone.
From Telephonoscope to telepresence
1878 Thomas Edison formulated his idea for a "Telephonoscope" to allow people to talk and see each other over distance. It was illustrated by George du Maurier.
1891 Alexander Graham Bell hypothesised a video telephone in On The Possibility of Seeing by Electricity.
November 14, 1920 First US demonstration of the video phone between New York and St Louis.
April 7, 1927 US Commerce Secretary Herbert Hoover used a Bell Labs device to project his moving image to a New York audience.
1936 German post office's videoconferencing system connects customers in Berlin and outlying areas.
1939 Demonstration video phone call at World's Fair.
1956 Bell Labs (AT&T) built first PicturePhone video phone test system.
June, 1964 AT&T Picturephone "Mod 1" demonstrated at World's Fair. Calling booths established in New York, Washington DC and Chicago (three minutes for $US16-$US27).
1965 AT&T distributed $1500 desktop PicturePhone I devices to 35 Union Carbide executives in Chicago and New York (three minutes $US13.50, 10-times cost of voice call. Average monthly cost $1000).
1967 PicturePhone II has a bigger display with zoom and potential for multiparty calls and document sharing.
1968 AT&T discontinued PicturePhone service at public booths in the US.
June 30, 1970 Bell deployed commercial PicturePhone service for $160 a month in Pittsburgh, predicted a million PicturePhone users within 10 years.
1973 Network voice protocol specifications published by ARPAnet.
1970s PicturePhone Meeting Service introduced; an hour was $US2340.
1975 Telecom predicted up to 200,000 video phones in Australia by 2000.
1982 Compression Labs offered $US250,000 videoconferencing system and $1000 an hour lines.
1986 Mitsubishi and Atari introduced $US1450 Luma 1000 video phone. PictureTel had $US80,000 system and $100 an hour lines.
1990 PicturePhone Meeting Service discontinued.
1991 PictureTel released $US20,000 black and white phones and $30 an hour lines.
1992 AT&T introduced a colour VideoPhone 2500 with compression that used ordinary phone network.
1992 Cu-SeeMe lightweight videoconferencing protocol published for Mac (no audio).
1993 Founding of first telepresence company, Teleport.
December, 1996 Microsoft NetMeeting with video released.
December, 1996 VocalTec Internet Phone 4.0 with video.
1998 Winter Olympics opening ceremony held on five continents using videoconferencing.
November, 1996 ITU published H.323 protocol.
July, 1997 Caltech-CERN Virtual Room Videoconferencing System allowed researchers in Switzerland and California to collaborate on the Large Hadron Collider.
2000 Monash University in Melbourne linked staff rooms at its Clayton and Caulfield campuses using a telepresence virtual boardroom table.
2002 ITU-T completes work on H.264 compression protocol used in videoconferencing networks.
2003 Craig Malloy founded LifeSize videoconferencing company in Austin, Texas.
August, 2003 Skype, a desktop videoconferencing software that used commodity hardware such as webcams and PC soundcards, released by entrepreneurs Niklas Zennstrom and Janus Friis.
September, 2005 Auction site eBay bought Skype for $US3.1b.
August, 2009 Stanwell completes deployment of HD videoconferencing systems at its far north Queensland and Brisbane locations.
September 1 Silver Lake Partners bought 65pc of Skype for $US2.75 billion. Skype has 480m users; 34pc calls use video.
October 1 Cisco launched $US3b bit to buy Norwegian videoconferencing maker Tandberg.
November 9 LifeSize launches $3000 desktop HD videoconferencing device, Passport.
Sources: Wikipedia, http://histv.free.fr; www.comphist.org; www.mediahistory.umn.edu; http://videoconf.net; AT&T; IETF; ITU; Alexander Graham Bell Family Papers at the US Library of Congress; On the persistence of lackluster demand - the history of the video telephone (Schnaars and Wymbs); Encyclopedia Britannica; NYU Dept Media, Culture, Communication; Bell Canada; Ericsson Museum; Wainhouse Research
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