Service innovation - To see or not to see?
It's been a dream, and then a disappointing reality, but conferencing should be about 
collaboration, rather than forcing technology upon the market, says Tim Duffy
Video conferencing is such an obvious solution to shifting traffic from the roads and airlines and making business faster and more agile. The amount of money and energy wasted on futile business trips is enormous, and the consequential environmental damage is enormous too.
Widespread adoption of video conferencing has been a dream of the communications and PC industry since it all became possible, and in fact before that with the launch of AT&T's prototype PicturePhone in 1956. Following years of trials the first services were launched by AT&T in 1970 with predictions of a million users within 10 years! BT launched its Confravision services in the early 70's linking custom built studios between London, Manchester, Birmingham, Bristol and Glasgow. Similar services were launched in Germany, all utilising full bandwidth analogue video circuits to full standard resolution TV quality, with excellent quality.
These custom studios were state of the art at the time, but clearly very expensive to operate using full bandwidth video. I was a regular user and this is where I gained my first experiences of video conferencing and became an early convert. Throughout the early 80's the digital revolution was gathering pace and the European PTT's recognised early that without common standards video conferencing could never gain widespread adoption. After years of collaborative R&D the ITU (the CCITT at that time) ratified the first European standards for digital video conferencing called H120 which standardised the transmission of video conferencing signals at 2Mbit/s. Switched networks and digital processing developments were gathering pace and it quickly became clear that transmission at switched 64Kbit/s and ISDN was possible so new collaborative standards were developed leading to the first global standard H320 in the late 80's. Since that time the standards have evolved to the full suite of AV standards that we have today that support a variety of coding algorithms and network types from mobile telephony through to high end Telepresence sytems utilising IP networks with QOS.
So the technology has evolved at a rapid rate and the quality possible today is truly stunning, so why then has this market not exploded?
The reality today however is patchy uptake and utilisation and an industry that has really stalled with so many well intentioned attempts to drive video in the mass market.
There is a very long list of video initiatives that have fallen by the wayside in every corner of the world, from AT &T's Picturephone service, BT's Confravision, Deutsche Telekom's BigFon service, BT & IBM's push into mass produced PC video phones in the mid 90's, Amstrad's video phone, Marconi's video phone, Intel's Pro Share PC technology that Andy Grove championed, 3's massive push into mobile video telephony, and many other high profile market initiatives that came to very little. We are seeing the same concept again now with Cisco's push into high end Telepresence and it will be interesting to see how this evolves.
The widespread adoption of video is always just around the corner, and despite the exceptional technologies and networks available today, and the potential productivity gains, the market is still struggling to hit mainstream.
Looking back on the technology developments in video over the past 20 years, the industry has been transformed, from grainy monochrome to HDTV quality with HiFi sound fidelity. Video conferencing today is almost perfect and utterly transparent so how could it not become the dominant way that we all communicate?
Having been around the industry for a long period I have come to realise that the adoption of video conferencing is not in any way a technology or network issue. Although that may seem obvious, it is lost on the companies building the equipment and networks who believe if you build a better mouse trap they will come. But will they? The history of the video conferencing industry as outlined above tells us the opposite is true.
We humans are all basically programmed to find the path of least resistance and this is true in communications as in other areas of life. We take choices everyday in how we communicate, we chat by the coffee machine, we send an email, we pick up the phone, we send a text message or we jump on a train or plane. We do what we need to do and rarely anymore. Hence my preposition that video conferencing will never become mainstream and will never replace the bulk of real time communications, the phone and the web, quite simply because these communication methods are far easier and require no special equipment.
In 2001 for example the equipment market for video conferencing end points was around 21,000 units per quarter. In 2005 this had increased to around 34,000 units per quarter, reaching around 44,000 units in 2009. Telepresence systems accounted for only a few percent. Cisco Telepresence systems have sold less than 3,000 units in total according to their announced data. These statistics hardly demonstrate an exploding market given that many of the shipments will be replacing the older systems sold in previous years with the latest HD technologies.
So what is happening in collaboration?
The interest in collaboration and travel reduction has never been higher on everyone's agenda, but the answer is utilising technologies and communications tools that are appropriate and sufficient, and satisfy the needs of the organisation. In comparison with the video conferencing market the audio conferencing market has done rather better. This can be illustrated with the growth of the audio conferencing traffic on a global basis. During the past 10 years audio conferencing traffic on a global basis has expanded from an estimated 3B minutes per quarter in 2002 to a market now touching 15B minutes per quarter, an annual growth of around 25-30% in volume terms. If you couple this with the very high growth rates now being experienced in web conferencing (sharing information and documents in real time) it is clear to see where the real application areas are. (Data Courtesy of Wainhouse Research 2009)
Marc Beattie Managing Partner, Wainhouse Research is quoted as saying "With the exception of mobile services, no other telecommunications service has achieved the sustained growth, popularity, and global adoption as audio conferencing. While new markets in Asia, Latin America, and Eastern Europe develop; established market such as the UK and US continue to realise significant growth. Since 2001 the global market has realised 25% compound annual growth (CAGR) while the adoption of new complimentary services, such as web conferencing, continue to push further use."
Video may be perfect in this age but the sheer convenience and simplicity of voice coupled with a good web conferencing tool can solve many collaboration issues, and the market data indicates clearly where the growth is.
I would argue that the key to effective collaboration in any organisation is an appropriate range of solutions from in house intranets, simple screen sharing, and web conferencing coupled with audio conferencing and of course video for that small section of users that need the hammer to crack the communications nut, and don't have access to the corporate jet!
If conferencing and collaboration is to have a real impact on the way we do business and shift our CO2 emitting business practices into the network, users are going to need complete simplicity and ease of use. The power users will of course need to have the latest all embracing unified solutions, but for the rest of the market, and I would argue the bulk of the market users need to have access to ultra simple reliable solutions that use their phone and mobile phone and their PC.
What of the future, it is clear that the advent of HD video is transforming the visual experience, so why are we happy to accept 3.4k Hz audio bandwidths when we could have FM quality? I see one of the biggest growth areas of the future is hifi audio conferencing and the ability to add graphics and collaborate is a fast and effective way.
Our job as service providers is to ensure that we are developing and offering services that hit the sweet spot of the market, make it simple and make it reliable, and if we continue to do this there is real hope that organisations will learn and adopt and become converts to this very important application area.
About the author:
Time Duffy is CEO, MeetingZone
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