New Lease of Life

One communication technology that defied the recession and went ahead with an
upward surge has been conferencing solutions. Domestic and global vendors
increased their activity in India to tap the potential market.

A combination of economic drivers such as globalization, outsourcing,
offshoring, telecommuting and mobile workforces have created dispersed teams and
added cultural complexity on how people relate to each other. The ability to
communicate and share information in real-time over any device and across any
network brings a distinct competitive advantage. This is being successfully done
by conferencing solutions.

As per Frost & Sullivan, the market is gaining hugely from organizations'
new-found austerity that includes enhanced collaboration and reduction in travel
costs. Revenues in Asia Pacific rose by 24.9% in 2008, and are expected to grow
further by 26.3% this year, reaching a market size $123.1 mn by the end of 2009.
Growth of the sector, which includes hosted services/SaaS
(software-as-a-service) and on-premise web conferencing software, is expected to
peak over the next two years, clocking growth rates of 27% in 2010 and 2011.

In the current year, all forecasts predict an upward surge. Conferencing
solutions have come a long way than just being an add-on interactive mode for
the bigger companies. As the penetration increases, there is a realization by
the public and private sector about the utility of conferencing solutions.

The overall videoconferencing market in India is about $42 mn, with about 70%
of this coming from endpoint revenues.

The potential market size for collaboration and conferencing solutions is Rs
10,000 crore spread over the next five years. The current year estimate for the
total market is approximately Rs 450 crore. Out of this, collaboration solutions
are going to drive a substantial growth for the segment as that is something
which will add value to the way enterprises conduct business.

Green Conferencing

'Green' is now more than a trend. The need to cut down on energy consumption
and also to save time has resulted in enterprises adopting conferencing
solutions more than ever.

The world is making efforts to find alternative sources for effective
collaboration. Globally, the increased usage of videoconferencing has lessened
the need to travel and have a collaboration that is giving strategic benefits to
small as well as big corporate houses.

Conferencing , particularly when video telephony is involved, is 'green'.
Enterprises and their employees are looking for more effective ways of meeting
virtually without having to spend money on an airline ticket or a tank of gas.
In conjunction with the new corporate initiatives to limit business travel,
there has been an increase in the initiatives directed at corporate social
responsibility and decreasing carbon footprints. Thus, videophone conferencing
can have the dual benefit of travel savings and green IT compliance for
organizations.

It's Pure Technology

With the ever increasing need for a better collaboration across enterprises,
organizations are now looking for such solutions that offer true strategic
value.

High definition videoconferencing (HDVC) is the latest offering when it comes
to videoconferencing. It is fast becoming the most acceptable form for video
communication. We see a marked increase in the adoption of HDVC across all
segments such as government, education, IT/BPO and healthcare. With HDVC
delivering high quality at an affordable price, the thing that will change most
quickly is the definition of telepresence.

The emergence of rich media conferencing is an interesting trend to watch out
for. Rich media conferencing is a powerful tool that a company can use to
achieve an effective interactive collaboration.

Another trend that is growing exponentially is videoconferencing. This sector
is moving beyond corporate to the government sector, judiciary, distance
learning, entertainment and telemedicine. There is an increased usage of
videoconferencing systems for interviewing candidates, interaction with
relatives settled abroad, reviews and meetings, product launches, press
conferences and auditioning actors. While enterprises started adopting HD as a
technology, this technology grew quite rapidly last year. Telepresence
deployment has also increased in the industry. The second generation
telepresence has been accepted very well. On the infrastructure side in terms of
MCU, the technology is moving from 720p to 1080p that is full HD. Companies are
now looking at archiving these video meetings; hence they are opting for
deploying different solutions.

The conferencing technologies are also moving from a solution that was for
sitting in a conference room to a desktop.

The enterprise market today has quite a significant deployment of IP phones.
Going forward, the need to make phones video enabled for better communications
is increasing.

With the emergence of Internet and evolution of network-centric business
practices, many companies turned immediately to multimedia conferencing; others
embraced applications that allowed groups to share documents and collaborate on
projects in real-time. Now some companies, including a growing number of small
and medium businesses (SMBs), are combining these capabilities to create virtual
meetings, and work faster and more effectively.

Telepresence in the form of custom three-screen mirror rooms that cost
hundreds of thousands of dollars has a tremendous appeal, but an inherently
limited market. It enables companies to build their telepresence networks on a
superior architecture, while customizing the cognitive (lighting and acoustics)
and aesthetic (room design and furniture) traits to fit their requirements,
budgets, and tastes. The flexibility of solutions allow companies to broaden
their telepresence networks to more environments.

Pricing Hurdle

As the trajectory of growth continues, technologies are being viewed as a
means of business continuity and containing costs in this tough economic
scenario. But the biggest hurdle is pricing.

Most of the conferencing deployments, especially video, are quite expensive.
So if the lack of awareness is used to downplay the market for a long time, then
for sure pricing is another big challenge which has to be overcome. On an
average, globally the prices have come down in the last few years with better
technology and features. Pricing still is an issue, especially with small
corporate houses.

Markets have a range of solutions when it comes to pricing. However, pricing
has to be seen in a positive light. There is an expected huge RoI after the
companies have deployed the solutions. These include:

• Reduction in airline ticket purchases
• Annual overhead saved by having some employees work from home
• Money saved through online and video based sales training versus the
  traditional classroom sessions

While the initial expense is relatively higher compared to other
communication products and services, the returns on the products are
proportionately impressive. In the long run, as the options multiply, prices are
expected to drop.

Evolving with Time

From a networking perspective, 14 bn devices will be connected to the
Internet by 2010, and the network will become one of the primarily utilities of
the twenty-first century. Cloud computing, data center technologies, security
and mobile applications are among the top ten strategic technologies identified
by Gartner for 2010. Various forms of communication enabled by the network are
the drivers of the next wave of innovation and will connect businesses and
people, by creating and enabling new experiences. Companies will transform
themselves to adopt collaborative cultures enabled by next-gen technologies such
as unified communications, business video, web 2.0 and virtualization that are
likely to gain sustainable competitive advantage.

For a while now-downturn or no downturn-there has been a consensus on the
fact that the Indian domestic market presents huge opportunities for the
networking sector. For instance, the scope for improving Internet and broadband
penetration in India is not only a business opportunity but a chance to play a
pivotal role in fostering inclusive growth in the country. Today, medical
facilities are being delivered over the Internet and students in remote parts of
the country are able to access education through distance learning models being
enabled by Internet technologies.

IT Investments in areas of e-governance, virtual healthcare, distance
learning, connected branch services, rural banking, managed data services,
hosted unified communications, and public safety & security are likely to
accelerate. A potential in solutions that use IP network as a platform to manage
physical security applications like video surveillance, physical access control,
communications, etc, is also on its peak and with it the conferencing business
will benefit the most.

Outlook

As per a Frost & Sullivan report, telepresence and WebEx solutions are
mainly used for corporate meetings and for recruitment by HR executives. As the
technology gains momentum, other applications such as training and research, and
the demonstration of products and services shall increase the adoption of these
technology solutions in the next three to five years.

Traditional video and web conferencing is fast changing. This change has been
accelerated by the launch of high-end video collaboration solutions such as
telepresence.

Public telepresence rooms have already been launched by multiple service
providers globally, including Tata Communications and Tata Teleservices
Maharashtra. With the arrival of public rooms, individuals now have the
flexibility to pay on an hourly basis to avail these services and evade the huge
investment costs involved in telepresence.

Companies are definitely looking at high-definition systems (1080p) as the
technology and bandwidth are now available. Companies are also looking at
implementing video into their unified communications portfolio.

The quality and in turn the user experience is dependent not only on the
videoconferencing devices, but also on the network bandwidth. Government of
India through the Ministry of Telecommunications has focused on providing a high
quality bandwidth to consumers. The setting up of the NIB, broadband
initiative-are all pointing towards the fact that IP bandwidth would be
available in India in the future. Hence, the network availability necessary for
videoconferencing would be in place.

According to a recent report by Frost & Sullivan, it has been predicted that
telepresence and videoconferencing will grow into a $4.7 bn industry worldwide
by 2014, out of which Asia Pacific is expected to contribute $1.7 bn.

Conferencing will truly change the way people work. India will be a very
quick adopter of the videoconferencing, particularly with the availability of
cheaper and faster broadband.

More interestingly, we believe that modern everyday devices like desktop
phones will be replaced by video desktop systems, and this will revolutionize
the way we work.

A Frost & Sullivan report on business continuity cited the criticality of
on-demand collaborative communication technologies for business continuity. It
says, "If employees are well prepared and comfortable collaborating remotely,
they are much more likely to stay focused and productive, allowing them to
continue supporting customers and positively impact the company's bottomline."

Education and health verticals have the potential to be large drivers in the
adoption of videoconferencing. But quality is a requirement that every business
has, and vendors are putting in every effort to ensure it.

Companies will be most open to the idea of 'working from home' as people are
more accessible through home based desktop systems. The deployment of
telepresence rooms would certainly increase. Apart from this, interoperability
among various video technologies that is from telepresence rooms to desktop
video, video on the move, video kiosks, video on 3G phones-is likely to increase
too.

Archana Singh

archanasi@cybermedia.co.in