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Cisco’s $3bn bid for Tandberg has made everyone sit up and take notice of video conferencing. It is only little over a week since HP launched its new SkyRoom video conferencing product for desktop computers. HP’s Halo already competes with Cisco at the high end of the telepresence market, with elaborate camera and meeting room systems which come close to simulating real-life meetings. Now, with the Tandberg acquisition and SkyRoom, both companies are looking to serve all segments of the market from high end to mass market. Microsoft has also developed teleconferencing services similar to Cisco and HP.
Video conferencing has suffered a poor reputation for years, after much hype and an often disappointing reality. Early video links were jerky and out of sync, worse than just using a standard, non-visual telephone link. But the technology has been improving and the market has been quietly growing. Video conferencing has been appearing in parts of bank trading floors, and on millions of personal computers in the form of Skype.
In the current climate of cutbacks and consciousness about the carbon footprint, video and telepresence are once again looking like serious replacements for a least some business travel. Earlier this year, analysts at Gartner forecast that video telepresence could take $3.5bn a year from the airline industry by 2012, replacing 2.1m airline seats a year.
Cisco sees the total addressable market for collaboration products as $34bn, of which video services will take an increasing share. Frost and Sullivan predicts that the telepresence market will grow from $2.5bn today to $4.7bn in 2012.
The acquisition of Tandberg leaves one video vendor of scale in the market, Polycom, and speculation will now be rife over whether Microsoft or HP might make a play for this company.
Tags: Cisco, Tandberg, Telecoms, telepresence, video conferencing
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